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Direct Line Insurance : Drivers have spent over ú25 billion less on vehicle expenses since March 2020

03/26/2021 | 11:05am EDT
Drivers have spent over £25 billion less on vehicle expenses since March 2020
4min read
26 Mar 2021
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  • Car owners have spent around £670 less annually, as car usage decreases
  • Collectively, UK motorists have undertaken 88 million fewer car journeys since March 2020 and have spent £780.6 million less on fuel costs every month as a result
  • Direct Line is providing customers with a refund on the miles they don't drive as part of its Mileage MoneyBack initiative

Drivers have spent £25.6 billion less on vehicle expenses since the start of lockdown in March 2020, reveals new research1 from Direct Line Motor Insurance. As restrictions and changes to working patterns have reduced the usage of their vehicles, owners have spent £670 less annually than they would normally, or £56 a month. This equates to a combined total of £2.1 billion reduction in vehicle related costs every month across the UK.

As part of Direct Line's Mileage MoneyBack initiative, the insurer is providing both new and existing customers with a refund on the miles they don't drive. Customers who register, could receive two per cent of their premium back for every 1,000 miles they don't drive, up to a maximum of 20 per cent of their premium returned.2

According to the research, the pandemic has led to an uplift in vehicle ownership, even as motorists are saving significant amounts in running costs. In fact, 1.4 million people have purchased a car for the first time since Covid-19 restrictions came into force last year as they look for ways to travel which don't involve public transport.

Even with more people owning cars, the number of miles driven has reduced substantially. With 13.9 million drivers having reduced the number of miles driven compared to the number cited on their insurance policy. Individually drivers are making 2.3 fewer journeys each week, equating to 88 million jointly. This reduction in journeys means fuel has been the biggest saving for motorists during the pandemic. Each driver has spent around £20 per month less on fuel, amounting to a staggering £780.6 million collectively across the country.

Regionally, those living in the North West are spending considerably less on petrol during lockdown than anywhere else in the UK. Motorists in the region are putting £43 less fuel in their cars now per month than before Covid-19 restrictions were introduced in March 2020. This is followed by those in the East of England (£28.50) and Wales (£24.70).

Table one: Monthly fuel costs for car owners pre and post Covid-19 restrictions (March 2020)

Region

Average monthly fuel spend, pre Covid-19 (March 2020)

Average monthly fuel spend, post Covid-19 (March 2020)

Saving

North West

£91.80

£48.80

£43.00 (47 per cent)

East of England

£73.50

£45.00

£28.50 (39 per cent)

Wales

£64.90

£40.20

£24.70 (38 per cent)

West Midlands

£77.90

£56.70

£21.20 (27 per cent)

Yorkshire and Humberside

£69.10

£49.80

£19.30 (28 per cent)

South West

£66.10

£47.40

£18.70 (28 per cent)

Scotland

£67.10

£48.50

£18.60 (28 per cent)

East Midlands

£79.00

£63.00

£16.00 (20 per cent)

North East

£84.90

£70.20

£14.70 (17 per cent)

South East

£80.10

£65.50

£14.60 (18 per cent)

London

£94.90

£83.90

£11.00 (12 per cent)

Great Britain total

£77.60

£57.20

£20.40 (26 per cent)

Source: Direct Line Motor Insurance 2021

Further to this, car owners are now spending less when it comes to areas of vehicle upkeep. Expenditure on maintenance, such as MOTs and servicing, is now £13.70 lower a month than before March 2020, and repairs are £9.90 lower than before. Interestingly, despite fewer people traveling into towns and city centres for work or pleasure, the cost of parking has increased by an average of 50p.

Motorists do need to remember that although they are driving much less, they need to continue maintaining their vehicle. It seems many are not conducting the same level of car checks they would do normally, with 6.3 million motorists carrying out fewer checks on tyre pressures than pre-pandemic. One in six (17 per cent) are not checking screen wash as frequently, while oil levels (13 per cent), lights, electrics and brakes (all 12 per cent), also seem to have fallen down the priority list.

Table two: Monthly vehicle maintenance costs pre and post March 2020

Motoring expense

Cost pre Covid-19 (March 2020)

Cost post Covid-19 (March 2020)

Saving

Fuel

£77.60

£57.20

£20.40

Maintenance (e.g., MOT, serving, car washing)

£74.70

£61.00

£13.70

Repairs

£56.90

£47.00

£9.90

Parking

£23.80

£24.30

+£0.50

Source: Direct Line Motor Insurance 2021

In response to the unexpected changes people have had to make adjustments to driving habits, Direct Line Motor Insurance offers customers Mileage MoneyBack, enabling motorists the option to claim a refund for any unused miles on their policy.

Lorraine Price, head of motor insurance at Direct Line, commented: 'Lockdown has undoubtedly changed the relationship many of us have with our cars. With more people working from home and not being able to leave the house unless for an essential journey, vehicles aren't moving as much as they used to. While it's great to see many being able to save some money during these difficult times, it is important to remember to carry out simple checks to ensure cars operate safely when you do need them.

'Life changes were made so abruptly last year that people weren't able to factor reduction in mileage into policies early on in the year. We want to support our customers in any way we can, that's why we want to make sure that if customers drive less, they also pay a little less.'

For more information on Direct Line's Mileage MoneyBack initiative please visit: www.directline.com/mileage-moneyback

- ENDS -

Notes to Editors

1 Research commissioned with Opinium between 19th and 21st January 2021 among 2,000 UK adults.

2 Terms and conditions

The opt-in date (the date from which we'll start to calculate your refund) will be the date your policy starts or the date you send us your car's first mileage reading (whichever is later).

If you already have car insurance with us, you can opt in anytime.

To qualify for a refund, there needs to be a minimum of 1,000 miles difference between the mileage you initially declared on the policy and the mileage you've actually driven.

If you change your car during your policy, you need to give us the mileage readings from both your old and new vehicle.

Your final (end of policy) mileage reading must be submitted after you receive an invite to renew your insurance with us, but no later than seven days after your policy expires.

Your refund will be calculated using the premium paid between when you opted in to Mileage MoneyBack and the end of your annual policy.

If you submit your final mileage reading up to 30 days before your policy ends/renews, we'll work out your average daily mileage (based on your previous months) and apply it to any remaining days left on your policy. If you submit your final reading up to seven days after your policy ends/renews, we'll use the average daily mileage to work out what the reading would have been on the last day of your policy.

If you (or we) cancel your annual policy at any point before it's due to end, no refund will be given.

After you submit your end of policy reading, we'll process your payment within 30 days.

All extra benefits added to your policy (such as Guaranteed Hire Car Plus or Motor Legal Protection) and any interest you've paid on monthly instalments will be excluded from your refund calculation.

We'll refund 2% for every 1,000 miles you don't drive, up to 10,000 miles. This means the maximum refund we offer is 20% of your base premium (the amount you pay for your insurance when you exclude extra benefits and interest on monthly payments).

If you have a DrivePlus policy with us, you'll still need to give us your mileage readings to request money back on your mileage.

We're unable to offer a refund on your mileage if you have a SELECT Premier policy, or if you have Van or Business Insurance with us.

For further information please contact:

Simon Henrick
Direct Line Group

Tel: 01651 831 668
Email: [email protected]

Direct Line

Started in 1985, Direct Line became the first UK insurance company to use the telephone as its main channel of communication. It provides motor, home, travel and pet insurance cover direct to customers by phone or on-line.

Direct Line general insurance policies are underwritten by U K Insurance Limited, Registered office: The Wharf, Neville Street, Leeds LS1 4AZ. Registered in England and Wales No 1179980. U K Insurance Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Direct Line and UK Insurance limited are both part of Direct Line Insurance Group plc.

Customers can find out more about Direct Line products or get a quote by calling 0345 246 3761 or visiting www.directline.com/car-cover

Disclaimer

Direct Line Insurance Group plc published this content on 26 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 March 2021 16:04:00 UTC.


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