Why are automatic cars more expensive to insure?

The answer comes down to several key factors

Why are automatic cars more expensive to insure?

Insurance News

By Mark Rosanes

Although manual vehicles still dominate roads across the UK, automatic car ownership has been steadily rising in recent years, data from the Society of Motor Manufacturers and Traders (SMMT) indicates.

2021 marked the first time when automatic cars outsold their manual counterparts, according to new-car sales statistics compiled by the trade association. Almost 916,000 vehicles with automatic gearboxes were purchased last year, accounting for 56% of the more than 1.6 million units sold. In 2019, before the pandemic struck, automatic cars already took up 49% of the overall market share.  

Industry experts attributed the increase partly to the government’s impending ban on the sales of new petrol or diesel vehicles by 2030.

Currently, manual cars still account for 70% of the estimated 31.7 million vehicles on British roads, according to the latest data from the Department for Transport (DfT). But with the upcoming phase-out of combustion engine units, experts anticipate a rapid shift to automatic cars, which include electric vehicles (EV).

Recent modelling by insurance giant Direct Line indicates that the transition is well underway, forecasting that the last person who will be taking a manual driving test will be born in five years’ time.

“With the average lifespan of a car around 14 years, the last new combustion engine cars sold in 2029 will likely be scrapped by 2043, meaning that the last 17-year-olds learning to drive in a manual gearbox car will be born at some point during 2027,” the insurer wrote in its analysis.

In addition, data from the Department of Vehicle Standards Agency (DVSA) shows that the portion of driving tests taken in an automatic vehicle climbed to 42% in 2020-21. In 2015-16, just 6.3% of tests were taken without a clutch pedal, highlighting the shift away from manual cars in recent years.

What are the advantages of owning automatic cars?

While the imminent ban on gasoline and diesel vehicles plays a role in the increasing switch to automatic cars among UK drivers, many of them are also attracted by the several benefits ownership of such vehicles brings. These include:

  • Easy operation: It is easier to learn how to operate an automatic car as drivers do not have to work on mastering to control the clutch when changing gears.
  • Smoother drive: Stalling is one of the main issues when operating a manual vehicle, especially for new drivers, but because automatic rides incorporate seamless transition between gears, this problem is eliminated.
  • Increased efficiency: New automatic vehicles come with up to eight gears, enhancing efficiency.

What are the drawbacks of driving automatic vehicles?

Driving an automatic car, however, comes with its share of disadvantages, including:

  • Costs: Apart from being more expensive to purchase, automatic vehicles are costlier to maintain because of their technologically advanced parts and components.
  • Licence restrictions: Drivers carrying automatic-only licences will need to take and pass a manual car driving test to be able to operate one, something that those who are licenced to drive manual vehicles are not required to do to operate automatic rides.
  • Less fun to drive: Some drivers prefer having more control over their vehicles and this includes being able to change gears. For them, operating an automatic car is considered boring.

Read more: Which are the safest new cars in the UK?

Why are automatic vehicles more expensive to insure than manual cars?

When calculating premium prices, car insurance companies consider a range of factors. Automatic vehicles are often more costly to insure compared to their manual counterparts because of several key elements, including:

  • Car price: Automatic models are usually more expensive to purchase, which also means higher repair and replacement costs, driving up premiums.
  • Complex gearboxes: Automatic cars have gearboxes that adopt more sophisticated technology compared to those in manual units. Because of this, such parts are often difficult to source and more expensive to fix and replace.
  • Licence type: Drivers who have licences that only allow them to drive automatic vehicles may be charged with higher premiums as statistically, they often file for a higher number of car insurance claims. 

Read more: The Top 10 cheapest cars to insure in the UK

How much does it cost to insure an automatic car?

Premiums prices for automatic cars vary between insurers but a 2020 study by MoneySuperMarket has shown that owners of this type of vehicle pay over £100 more annually compared to those who drive manual models.

The rate comparison website compiled data for a fully comprehensive policy for a main and only driver between January and September 2020 and found that yearly premiums for vehicles with manual transmission cost £681 on average, almost a fifth less expensive than the £785 for automatic vehicles.

In terms of popular car models, a Volkswagen Golf with an automatic gearbox cost £1,019 to insure per – about 16% higher than the £854 for manual versions. Premiums for automatic and manual Landrover Range, meanwhile, were £999 and £750, respectively. For a Mercedes-Benz C, car insurance for automatic versions averaged £781 while coverage for manual units was £735.

How can drivers of automatic vehicles save on car insurance costs?

While insurance for automatic cars is generally more expensive, there are a few for drivers to offset higher costs. Because new units are more fuel-efficient, for example, owners can save on fuel costs, especially when driving long distances. Here are some other ways automatic vehicle owners can reduce premiums:

  • Check out the insurance costs when buying a car.
  • Always shop around for quotes.
  • Pay premiums annually, rather than in monthly instalments.
  • Increase the voluntary excess but only up to an affordable limit.
  • Park the car in a safe and secure place.
  • Consider getting a telematics policy.
  • Refrain from making unnecessary car modifications.
  • Install security features such as an immobiliser.
  • Reduce annual mileage.

The choice between buying an automatic or manual vehicle all boils down to personal preference. While the former offers a range of advantages, especially for those living in a busy city, car buyers also need to consider the disadvantages. Insurance rates may be more expensive but by taking the right measures, drivers can also cut costs. This underscores the importance of going out there and making sure that you know the basics of insurance claims and everything else related to this important product.


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