One in four drivers in Ireland have either considered or made the switch from fully comprehensive to third party or third party fire and theft motor insurance within the last two years due to tighter personal finances, a new study by the AA has revealed.
However according to the AA study, just 5 per cent of drivers overall have actually gone through with downgrading their cover for economic reasons during the same time period. Of the remainder, many indicated that the price gap between the two levels of cover was much narrower than they anticipated and not worth the loss of peace of mind. Others stated that the “fear factor” encouraged them to look for savings elsewhere in the end, worrying they would fall foul of Murphy’s law if they made the switch.
“If you’re on the fence when it comes to comprehensive versus third party insurance there are two obvious question that you should ask yourself,” says John Farrell, director of AA Insurance.
“Firstly, how well you would cope with a big repair bill in the event of an accident, malicious damage, or weather damage and secondly how dependent you are on your car. Our advice is to reduce your premiums by shopping around rather than downgrade. You could well make the savings you’re looking for without jeopardising your level of cover.”
The greatest inertia as regards switching from one level of car insurance cover to another is among the over 65s the AA study suggests. Inversely, the youngest cohort of drivers on our roads, 17-24 year olds, were identified as the most likely switchers, with 12 per cent of those polled indicating they have reduced their cover within the last two years.
“This group are paying the highest premiums and are often driving lower value cars so it’s not all that surprising to see more movement,” says Mr Farrell.
“However our advice to this age group is the exact same. Come renewal time, shop around before you make up your mind. If you’re struggling with your premiums chances are you’ll be hard pressed trying to cobble together the money if your car needs a major repair.”