The Virgin Money Group claims drivers will be able to save up to 48% on typical car insurance thanks to its aggressive pricing and the scrapping of interest charges for monthly instalments.
It quotes a 25-year-old Essex man driving a Fiat Punto Active Sport 1.2-litre 16v car worth £9,200 at £318.19 fully comprehensive, which it says saves up to £190 on other online insurers.
Richard Branson, Virgin Money Group chairman, says: “If you pay for your car and home insurance in monthly instalments the chances are you are paying more than you need to for your cover.
“Interest charges on insurance premiums paid by direct debit are costing consumers dear. We won't be charging a penny more for customers that enjoy the convenience of paying monthly.”
Branson, who still has a stake in Virgin cars, adds: “There is nothing we love more at Virgin than improving the customer's lot and at the same time challenging existing providers. With our new package of insurance products, not only will customers save money on their premiums, they will benefit from multiple discounts.”
The products will be sold direct over the phone and on the web using an online quote-and-buy service at virginmoney.com. The decision to offer car insurance comes after Virgin took 100% ownership of VMG by acquiring the 50% stake in the company held by venture capitalist HHG for £90m.