The New Zealand motor insurance industry is competitive, but new entrants are pricing below established players, according to MoneyHub which publishes its review on car insurance and highlights how vehicle owners in the regions save as much as 50% than those living in cities for the same vehicle.
A report released by MoneyHub gathered a number of quotes which suggested vehicle owners all over New Zealand could be overpaying hundreds of dollars more per year by not shopping around.
MoneyHub found that the relatively unknown Trade Me Insurance offered the best value for comprehensive vehicle insurance on standard vehicles. In comparison, AA insurance charged on average of 40% more for similar policies.
MoneyHub’s Senior Researcher Christopher Walsh said, “New Zealanders have a wide choice of car insurers and getting an online quote has never been faster or easier, but it’s essential to compare to save the most and get the right policy. While most policies had the same NZ$400 (US$280) excess, the annual saving in the upfront policy could be significant by getting a few quotes”.
Vehicle owners in the regions generally pay a lot less than those in cities, with Invercargill and New Plymouth being two examples of cities where car insurance can be 35-50% cheaper than what it would cost for an Auckland driver of the same age to insure the same vehicle. Insurers tended to penalise those living in areas with tricky and bendy roads such as Piha by charging more for a policy. And within Auckland, prices also vary – every insurer charged different amounts for the same vehicle when MoneyHub compared Takapuna to South Auckland.
MoneyHub said, “Policy costs for a typical vehicle vary widely - we found Trade Me Insurance (which is underwritten by Tower) to be the best overall value at an around 30% below the market average for the vehicles we priced.
“Young driver insurance continues to be expensive as insurers perceive newly qualified drivers as the highest risk; some of our most helpful tips such as installing car alarms and parking a vehicle in a secure garage would not drop the price of a premium significantly to those under 25 years of age.
“We confirmed that paying for car insurance annually instead of monthly is always cheaper, sometimes by as much as 15% across the insurers we evaluated."
MoneyHub is a New Zealand consumer website, dedicated to helping users save money.