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Revved-up rates: More than half of Australian drivers facing car insurance hikes

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Australian drivers are facing hikes to their car insurance premium as inflation continues to rise, according to new research by Finder.

A Finder survey of 933 car owners revealed more than half (55%) have noticed a spike in their car insurance premium in the last 12 months.

The research found 1 in 10 (11%) don't know if their car insurance premium has gone up in the last 12 months, while 6% don't have any car insurance as a fail-safe to protect them from unforeseen events.

According to Finder's Consumer Sentiment Tracker, 1 in 10 (9%) Australians listed car insurance as one of the top 3 bills causing them the most stress in March 2023.

James Martin, insurance expert at Finder, said Australia is dealing with record inflation, and car prices are no exception.

"Car insurance premiums go up for many reasons, from higher parts and repair costs, to increasing crime rates and even natural disasters.

"It's also costing more for insurers to process claims. This means you could see your premium rise despite no change in driving habits or claims being made."

Price (46%) is the most important factor Australians look for when choosing car insurance.

Other determining factors include comprehensiveness (32%) and brand recognition (14%).

Finder Car Insurance Awards 2023 winners revealed

The Finder Awards for the best car insurance providers for 2023 have been revealed.

Finder reviewed 1,182 comprehensive car insurance quotes across 37 brands, rating policies on the comprehensiveness of cover, price and value.

There was a difference of $1,456 between the cheapest and most expensive policy.

Youi's comprehensive policy stood out as this year's Finder Award for Car Insurance – Features because it covers more than other insurers but is still a comparatively inexpensive policy.

Highly Commended policies in the Features category included Hume Bank – comprehensive and Qantas – comprehensive.

Budget Direct's comprehensive car insurance policy won this year's Finder Award for Car Insurance – Value because it provides a similar level of cover to other insurers but at a lower price.

Highly commended in the Value category included ​​Hume Bank – comprehensive, which was also highly commended in the Features category and Youi – comprehensive, which picked up the win in the Features category.

Martin said despite the price hikes, there are ways to reduce your car insurance premium.

"Opting for a higher excess will reduce your premium – sometimes by a few hundred dollars – but you'll need to pay more upfront if you need to make a claim.

"You could remove cover for under-25 drivers, if you're sure no younger drivers will have to use your car.

"You could avoid making claims for small scratches and minor dents as this can increase your premium each time you make a claim.

"Look for discounts like sign-up offers, and always review your policy at least every 12 months."

"Remember, loyalty doesn't pay – the best-value policy today might be more expensive when it renews next year. You could save hundreds by switching providers," Martin said.

Has your car insurance premium gone up in the past 12 months?
Yes55%
No27%
I don't know11%
I don't have car insurance6%
Source: Finder survey of 933 respondents with a car, February 2023
What is the most important factor when choosing your car insurance?
Price46%
How comprehensive the policy is32%
I know the brand14%
Extras like roadside assistance5%
I have a car but don't have comprehensive car insurance3%
Source: Finder survey of 933 respondents with a car, February 2023

For more information on Finder Car Insurance Awards 2023, visit https://www.finder.com.au/finder-awards/product/car-insurance-awards-2023

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