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Interest on Instalments
Paying on instalments can be an extremely expensive business
Instalment charges vary enormously (APR):
• Privilege and Virgin Insurance interest 0 per cent
(from time to time)
• Hastings interest 29 per cent APR
Some intermediaries have APR’s of over 40 per cent:
• Kwik Fit interest 35 per cent
• Direct Choice interest 43 per cent
Should you choose to pay by instalments do not purchase your policy until you have checked the interest rates (APR’s) as this could have a bearing on your decision.
Comments:
This is an area to save money. It’s easy to be sucked in with a cheap premium, only to be stung by outrageous interest rates.
• Admiral
• Bell Direct
• Diamond
• Elephant
If you have an acceptable price with this group of companies from the Internet and wish to pay on instalments, be careful.
They insist that you phone them to arrange payment by instalments. You then lose your Internet discount, which is a sizeable extra chunk (you are of course charged interest on the new amount making an enormous difference from the original internet price).
They will also try hard to sell you policy extras, which seems less expensive on instalments. Resist these, particularly the salary protection plan, at £20.95 as this does not reflect particularly good value for money.
Overall you may be better advised to pay your premium in one go on your credit card, particularly if you have an interest free deal. |
