Out with the old and in with new car reg

With March's new car registration well under way and ‘11' plate cars sitting on forecourts waiting for new owners, motorists tempted to get behind the wheel shouldn't be lulled into assuming a new model will always be more expensive to insure than an older one, according to moneysupermarket.com.

Britain's number one comparison site analysed the cost of motor insurance premiums for five and ten year old models of the most popular cars insured through the site in 2010 and compared these to the cost of a newer model. The analysis found for a Ford Fiesta, for example (the nation's second most insured car), a 35 year old male could pay 19 per cent less for annual motor insurance for a 2011 model compared to the 2001 model.

Peter Harrison, car insurance expert at moneysupermarket.com, said: "With the latest ‘11' plates on offer, some Brits may be tempted to treat themselves to a new set of wheels. With the cost of car insurance rising by 44 pence on average per day however, the cost of premiums will often be one of the deciding factors to consider before splashing the cash on a new car.

"It's common belief that a new car will be more expensive to insure than an older model, but our research reveals there are some occasions where this is not the case, and also on the positive side where the premium for a new car does show as more expensive, the price differences are much smaller than many would expect.  For firm favourites like the Ford Fiesta or Vauxhall Astra it is interesting to see it's actually cheaper to insure a 2011 model than one five and even ten years older."

moneysupermarket.com also urges drivers who bought a brand new car last March, to review their insurance carefully, particularly those who received a year's free insurance at purchase. Further research reveals motorists are set to lose up to £270 each, or £1.7 billion collectively, by sticking with their existing insurer and not shopping around for the best deal.

Peter Harrison continued: "Receiving 12 months' free cover is a great perk when buying a new car, and we can all do with a little extra help with our finances at the moment, but once this offer runs out is it vitally important to be savvy and shop around for a better deal.

"You could find yourself paying a significantly inflated premium if you stick to the same provider as the policy is unlikely to be very competitive. Always scour the market for the best deal for your circumstances."