Annual payment settles the premium in one amount. Monthly payment commonly involves a credit arrangement, so the total amount payable over the year can be higher than the annual premium.

How insurers commonly treat this

• The total payable is more informative than the monthly instalment alone.
• Interest or credit charges can vary between insurers.
• The instalment agreement can have separate terms dealing with missed payments and cancellation.

What the quotation may ask for

Quotation forms use the information supplied to determine which insurers can offer cover and on what terms. Where the available answer does not accurately describe the circumstances, the insurer or comparison provider can clarify how that information is recorded.