Martin Lewis has warned car insurance companies may be using loopholes to ensure existing customers continue to pay more.
Car insurance firms used to be allowed to increase their monthly prices for their current customers every year.
However, this was banned by the Financial Conduct Authority (FCA) back in 2022 to make the market fairer for consumers.
But, despite this, Martin has stressed firms are finding a way around the issue with existing customers still likely to save more by shopping around.
Martin called out firms as he handed out tips to motorists in a recent Money Saving Expert newsletter.
Mr Lewis wrote: “You may have heard that since January 2022, car and home insurers have been banned from charging renewing customers more than they charge new customers – to stop the annual ‘price-walk’ of pushing up prices at each renewal, so that after a few years you paid a massive loyalty premium. Yet even though that’s gone, auto-renewing is still likely to cost more.”
Firstly, he claimed some firms had simply “boosted prices for all” meaning there are fewer new customer deals than there were before.
However, he pointed out there were other crafty ways insurers could get away with charging more.
He warned some insurance firms own more than one brand and therefore could use this to their advantage.
Martin stressed they could try and win over consumers via new brands, leaving their existing brands at higher prices.
Insurers can also claim that their prices vary hugely by the type of customers they want to recruit to sign up.
Martin also pointed out that insurers can sell their product at varying rates through different mediums.
This explains why deals at comparison suits are often cheaper than going directly to their insurance firm’s website.
He added: “The ‘same price for both’ rule is channel specific. For example, if you got insurance direct, your renewal must cost the same as if you were a new direct customer.
“If you had gone via a comparison site, it must cost the same as a new customer via THAT site (others may be cheaper).”
But, Martin admitted that there would still be some circumstances where sticking with an existing policy could pay off.
He concluded: “Of course, of the millions of readers of this email, some will find their renewal is cheapest. If so, fab. The key is to never assume your renewal is the winner without checking.”
