Britons given car insurance warning

Mon, 11 Oct 2010

The rate of interest charged on the monthly instalments of a car insurance policy can be hard to find out, it has been observed.

Writing for MSN Money, Omotola Akerele noted that for some Britons, spreading out the cost of insurance is the only way they can afford to pay for it.

For those who do fit into this category, though, it's important to find out "exactly how much more you'll be paying overall with interest added".

"Interest charged on direct debit payments can be as much as 37 per cent APR for motor insurance," Ms Akerele warned.

This follows claims made last week by Ms Akerele that cancelling a car insurance policy mid-term can prove costly.

Many customers wrongly expect to get back the proportion of the premium that applies to the remaining period, she noted.

Unfortunately, however, many car insurance providers will calculate the refund based on a system of short-term rates.
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