MILLIONS of insurance customers are stuck inside a "vicious cycle" of monthly payments – AND are being financially hit for the privilege.
Price comparison site GoCompare found drivers are spending an additional lb144 annually and home insurers lb113 a year on average, in comparison with people who pay in one go.
When buying insurance you are normally because of the choice to spread the cost of your premium over a year, or if you are paying in one lump sum, which is usually cheaper.
In one example, it found an average car insurance premium of lb498 rocketed to lb597 when paid monthly – an additional lb99.
Unsurprisingly poorer drivers and home insurers are more likely to spread the cost of their premiums.
GoCompare discovered that nearly half (47 percent) of drivers from lower income households pay monthly when compared with 29 per cent of high earners.
Some 53 per cent of lower income households pay monthly for his or her property insurance, compared to higher income families.
Those who do pay monthly will also be 33 per cent less likely to switch providers – meaning they're passing up on potential savings with regards to renewal time.
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Georgie Frost of GoCompare said: "Should you pay monthly for your insurance, you will more often than not wind up paying more.
"Remember – whenever you pay monthly you're not really paying for your insurance, you're paying back a loan that accompany interest charges.
"You won't just pay more because of that credit, but our research shows that you are less likely to change in future should you pay monthly, which could end up costing you even more every year.”
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