If you are a driver, you can save loads on breakdown cover – as long as you don’t let it auto renew!
This post is based on a frugal fail. Last year, I got stung when I didn’t get round to sorting our cover before it renewed automatically. Our AA membership shot up from £109 as a new customer to £220. Ouch. I resented paying double the price.
This year they wanted more – £270! That’s an increase of almost another 25%!
I really didn’t want to pay over the odds again, so I tackled it yesterday morning.
After checking quotes, cashback and a quick call to the AA, I ended up switching to the RAC. Our new premium cost £109 and I should get 11% cashback, just by clicking through from TopCashback before purchasing the policy. This brings the cost down to just under £97.
I reckon spending half an hour to save £173, compared to the renewal quote, is well worth doing.
Here are my top tips if you want to save on breakdown cover.
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Don’t auto renew
Don’t ignore your renewal letter! Check the new cost and when it’s due, then carve out time to cut it.
The company might sound like they’re doing you a favour, continuing your cover without you having to a lift a finger. But you’ll pay an awful lot for the convenience.
Check if you’ve already got cover
I’m not suggesting you might have bought breakdown cover in your sleep.
But do you already have cover, for example if you pay a monthly fee for a current account?
Some packaged current accounts such as Nationwide FlexPlus, Halifax Ultimate Reward and Co-op Everyday Extra offer a bundle of benefits including breakdown cover. No point paying twice!
Before calling the company (‘you want to put it up by HOW MUCH???‘), arm yourself with the relevant info.
It doesn’t have to be a major hassle. I popped over to two websites, the AA and RAC, to see how much new customers pay for the same cover. RAC quoted £108.51 and the AA £169.01 for a year’s cover. I’m sure there are other great options out there, but I focused on the big hitters to make life easier.
Weigh up your cover
There are various twiddly bits that make up breakdown cover. The more you add, the higher the premium, so choosing less cover will cut your costs.
UK vs Europe?
Where will you be driving? We opt for cheaper UK cover as we rarely drive in Europe.
Vehicle vs personal?
Do you want to cover you or the car? Vehicle cover applies to a specific car, no matter who’s driving. Personal cover applies to the individual, no matter which car you’re driving, or even if you’re a passenger in someone else’s car.
Vehicle cover tends to be cheaper, but we go for personal cover, as we have two cars and sometimes borrow a bigger car to go on holiday.
Individual or as a couple?
If you’re a couple, it’s usually cheaper to buy breakdown cover for both people at the same time, rather than two single policies.
Personally, we go for:
- roadside assistance, to avoid being stuck by the side of a motorway
- the bit about towing your car if it can’t be sorted on the spot
- home start, in case our cars die in the drive
But no, I reckon we don’t need to pay extra for getting keys cut, legal expenses, a contribution towards repair costs or money for transport and accommodation after a breakdown while away from home. We have some emergency savings if needed.
Previous post: Where do you stash your emergency cash?
Annual vs monthly?
If you can afford to fork out for a full year’s cover, it’s usually cheaper than the total from paying each month.
Yesterday, TopCashback was offering 11% cashback on RAC* UK personal breakdown policies and a generous 33% on vehicle based policies. That’s a healthy chunk of cashback.
Meanwhile you could get a whopping 42% cashback on AA* UK breakdown cover.
Quidco offered slightly less – 30% cashback on RAC UK vehicle breakdown policies, 10% on RAC’s personal version, and 40% on AA UK breakdown cover.
After setting the TopCashback rates against my quotes, the cost of breakdown cover for new customers dropped to £96.57 at the RAC and £98.03 with the AA.
Cashback isn’t guaranteed, but it usually does work out, and can be well worth it. The sites are free and all you have to is click through from them before buying online elsewhere!
Give your current company a call
I reckon it’s worth a quick call before switching elsewhere, to see if your current company can offer a better deal.
Previous post: Broadband: how to save without switching
So I rang the AA, pressed the buttons for the renewal option, and pointed out our renewal price was a lot higher than last year.
The nice man on the phone promptly offered to cut the cost to £224, pretty much what we paid last year, and to freeze for next year. Saving £46 a year compared to our renewal quote might have sounded quite good, if I hadn’t checked the premiums for new customers elsewhere.
Having the numbers for quotes and cashback to hand, and explaining politely that you can get cover cheaper elsewhere, works wonders.
I was then offered £202.58, again frozen for two years. So £67 off the renewal quote just for a few minutes chat.
Once it was clear I really was thinking of switching, the final offer was £169.01 for one year. That’s a hundred pounds lower than our renewal letter, and the same as the premium for brand new customers. However, the guy on the phone couldn’t match the cash back, so I cancelled the policy when it runs out.
Be prepared to switch
Buying a new policy from the RAC only took a few minutes.
I clicked through from the relevant RAC page on TopCashback, ticked the cover I’d already looked at, filled in a few personal details, and set the new breakdown cover to start when our current policy stops.
At £108.51 the policy is already way lower than our renewal quote, even if the cashback doesn’t come through.
Name the first driver
One admin point: with joint cover, put the person who usually deals with money matters as the first named driver.
With our AA policy, I had to hand the phone to my husband to finally cancel the cover, as he was the first named driver. With the new policy, I’ve put myself down as first named driver. I don’t want to risk auto renewing just because we weren’t in the same place at the same time to call the breakdown company during working hours!
Thoughts on how to save on breakdown cover
It took me max half an hour to cut the cost of our cover by £173, and I reckon that’s money well worth having.
But it worries me that such big savings are possible. Slashing £100 off premiums in a single phone call, and hefty cashback rates up to 42%, imply the original premiums have mega high margins. The two new customer quotes I got, after allowing for cashback, were surprisingly similar, with only a few pounds difference.
What about people who aren’t internet savvy, or don’t use cashback websites? Anyone who still thinks loyalty pays, or doesn’t like calling companies for a better deal? If you know anyone vulnerable or elderly, it might be worth asking if they have breakdown cover, and whether you can help cut costs.
So don’t get stung like I did last year. Never let breakdown cover auto renew – and hang on to more of your own money!
Now – over to you. Have you ever cut the cost of breakdown cover? What’s your top tip? Do share in the comments, I’d love to hear!