Which? urges ban on extra charges for paying monthly for car insurance
Consumer group Which? says a mystery-shopping probe found monthly car insurance payments often carry APRs at or above typical credit card rates, and wants two-tier pricing banned. Insurers and brokers say monthly payment options have costs and serve a purpose.
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The story, neutrally told
Mixed · 2Which? has called for a ban on charging extra for paying monthly for motor insurance, after an investigation it says found rates comparable to or above those on credit cards. Evening StandardN “But Which? argued that motor insurers should be banned from charging extra for monthly payments, as well as being required to offer a pay monthly option.” Read at Evening Standard ↗ Daily MirrorL “Which? has slammed car insurance firms for charging a "poverty premium" to customers who cannot afford to pay upfront.” Read at Daily Mirror ↗ Mixed · 2Monthly payment is usually arranged through premium finance, a credit agreement, and Which? estimates about 15 million UK customers use it for motor insurance. Evening StandardN “Which? said an estimated 15 million customers across the UK use premium finance to pay for motor insurance.” Read at Evening Standard ↗ Daily MirrorL “This type of loan agreement is known as premium finance and it is estimated that 15 million UK customers use this to pay for car insurance.” Read at Daily Mirror ↗ Centre · 1In August Which? collected quotes from 30 providers for the same profile, a 42-year-old Sheffield motorist with 10 years of driving and no claims in the past five years; the median APR across 36 quotes was 26.2%, against about 25.9% for a credit card based on Moneyfacts data, and some quotes were above 50%. Evening StandardN “The median average APR (annual percentage rate) across 36 quotes analysed in the mystery shopping investigation was 26.2%, although some rates quoted were as high as 50% plus.”“Which? said this compared with around 25.9% for a credit card APR, according to its analysis of Moneyfacts data.” Read at Evening Standard ↗
Left · 1The Mirror reports the highest APRs came from brokers: City Insurance (53%), UDrive Cover (50%), Sterling Insurance (38%), Rightsure (34%) and Acorn (33%); only 14 providers charged under 25%, and Marshmallow and Motorcade charged 0%. Daily MirrorL “City Insurance charged the highest interest rate (53%) followed by UDrive Cover Ltd (50%), Sterling Insurance (38%), Rightsure (34%) and Acorn (33%).”“Only two insurers, Marshmallow and Motorcade, charged 0% APR” Read at Daily Mirror ↗ Left · 1In cash terms, paying monthly added as much as £367.75, turning a £2,583.23 annual Rightsure policy into one costing £2,950.98. Daily MirrorL “these figures represent as much as £367.75 added to the typical car insurance bill, turning a £2,583.23 annual policy from Rightsure into a £2,950.98 one.” Read at Daily Mirror ↗ Mixed · 2Rocio Concha, Which? director of policy and advocacy, said too many consumers have been pushed out of driving or into financial peril, and that a ban on two-tier pricing would create a fairer, more competitive system; she urged the Prime Minister to announce it in the upcoming budget and criticised the regulator for shying away from its responsibility. Evening StandardN “Too many consumers have already been pushed out of driving or into financial peril.” Read at Evening Standard ↗ Daily MirrorL “we’re urging him to use the upcoming budget to announce a ban on two-tier pricing for motor insurance.” Read at Daily Mirror ↗
Centre · 1James Daley of Fairer Finance said it cannot be right that the poorest people pay the most for car insurance. Evening StandardN “It can’t be right that the poorest people in our society are forced to pay the most for their car insurance.” Read at Evening Standard ↗ Left · 1The Mirror notes the FCA concluded a market study in March 2026 that ruled out a price cap or a ban on interest for pay-monthly policies, saying its current rules were sufficient. Daily MirrorL “the FCA concluded a market study in March 2026, where it ultimately ruled out a price cap or ban on charging interest for pay-monthly policies.” Read at Daily Mirror ↗ Mixed · 2Firms told Which? premium finance carries higher credit risk, that APR alone does not show the value provided, and that arrangements are kept under review; City Insurance said it will cut its APR from 53.03% to about 36%. Evening StandardN “Which? also said firms had told it that premium finance is associated with higher levels of credit risk, and that assessing APR in isolation does not give a complete assessment of the value provided to customers.” Read at Evening Standard ↗ Daily MirrorL “we have agreed new terms which will reduce the representative APR from the 53.03% rate as identified by Which? to approximately 36%” Read at Daily Mirror ↗
Centre · 1The British Insurance Brokers' Association said premium finance helps spread costs and that firms must show fair value, citing an FCA report that broker APRs are generally comparable to other credit; the Association of British Insurers said customers value paying monthly and that it involves costs for insurers, such as keeping cover in place when payments are missed. Evening StandardN “Premium finance serves a valuable purpose, helping consumers to spread the cost of their insurance cover.”“Providing pay monthly options involves some costs for insurers, including keeping cover in place for a period if payments are delayed or missed.” Read at Evening Standard ↗
Every sentence links to the reporting it rests on. The pill in front of each says where its sources sit: Left, Centre or Right when one side supplies at least half of them, Mixed when they are evenly split. The number is how many outlets it cites.
Left1 outlet
- Framing
- Leads with the 'poverty premium' charge and firms being 'slammed', naming the worst-charging brokers and cash costs.
- Emphasis
- Named firms and their APRs, pound figures, the FCA's decision not to cap or ban, and Which?'s criticism of the regulator.
- Leaves out or plays down
- Does not include the Association of British Insurers or Biba responses or James Daley's comment.
- Charged language
- “slammed”“poverty premium”“extortionate interest rates”
- For example
-
“Car insurance firms slammed for charging 'poverty premium' to drivers who pay monthly” — Daily Mirror
“what it considers extortionate interest rates which are above typical credit card APRs” — Daily Mirror
Centre1 outlet
- Framing
- Reports the Which? call for a ban on 'two-tier pricing' as a consumer group proposal, with industry bodies given space to reply.
- Emphasis
- Median APR versus credit cards, and responses from Biba, the ABI, Fairer Finance and firms.
- Leaves out or plays down
- Does not name individual high-charging firms, give cash examples or mention the FCA's March 2026 decision.
- Charged language
- “two-tier pricing”
- For example
-
“A ban on ‘two-tier pricing’ for motor insurance would create a fairer, more competitive system, the consumer group said.” — Evening Standard
“We know that people value the option to pay monthly to keep their insurance affordable and accessible.” — Evening Standard
Right0 outlets
No right outlet in our sources has covered this story yet.
What every side reports
- Which? ran a mystery-shopping probe of 30 providers using a 42-year-old Sheffield driver profile.
- The median APR across 36 quotes was 26.2%, against about 25.9% for credit cards.
- About 15 million UK customers are estimated to use premium finance for motor insurance.
- Which? wants a ban on two-tier pricing.
Where accounts differ
-
Whether monthly APRs are unfair
- Left
- Which? says they are a 'poverty premium' and 'extortionate' at the top end.
- Centre
- Insurers and brokers say APR alone does not show value, credit risk is higher, and customers value paying monthly.
Which (consumer group) organisation
Says monthly payers are charged more, wants a ban on extra charges for monthly payment and a requirement to offer it, and urges the government to act in the budget.
“a “ban on two-tier pricing for motor insurance” would “create a fairer, more competitive system that doesn’t punish the customers least able to pay”.” — Evening Standard
“Our latest investigation exposes the consequences of the regulator shying away from its responsibility to ensure competition works for consumers.” — Daily Mirror
Left1 article
-
Car insurance firms slammed for charging 'poverty premium' to drivers who pay monthly
Critical Campaigning tone against insurers, with named firms, APRs and cash costs.
Centre1 article
-
Which? calls for ban on charging extra for pay monthly motor insurance
Neutral Reports the Which? findings and call for a ban, balanced with industry responses.
Right0 articles
No coverage yet.
- 14 Oct 00:01 First Evening StandardN Which? calls for ban on charging extra for pay monthly motor insurance
- 14 Oct 00:03 +3m Daily MirrorL Car insurance firms slammed for charging 'poverty premium' to drivers who pay monthly
Times are when each article was published, or when we first saw it if the outlet gave no time.
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