UK contact centre
Reducing Your Car Insurance Premium
Owning a car can be one of life’s biggest expenses, both in terms of initial purchase and the running costs. Insurance, tax, petrol, servicing – it all adds up. If you are looking at renewing your car insurance, we’ve gathered some top tips on how you can achieve the lowest premium.
1) Get a car suited to your needs
Don’t rush out and buy the first car you see because you like the colour! Take your time to weigh up the options; most cars come with a variety of engine options and trim levels that will affect your premium. This is particularly important for learner and young drivers, where even a small increase in engine size can make the car virtually uninsurable.
DID YOU KNOW? Some classic cars are more affordable to insure as insurers recognise the love lavished upon them by their owners.
2) Work out your mileage
You will be asked for your annual mileage when seeking insurance quotes, which can have a notable impact on your car insurance costs. Whilst you don’t want to underestimate your mileage, you could try and work out what you are likely to do on an average month, and then extrapolate for the year.
Could you reduce your premium by lift-sharing, cycling to work occasionally, or by making use of public transport? It could be the start of a fitter, eco-friendly you!
3) Add an additional driver
Adding another driver – such as a parent - who has more experience than you, or has never claimed, will likely reduce your premium as it dilutes your risk.
With this knowledge, it’s important not to take advantage. If you are not honest about who the main driver is to manipulate your insurance costs, it will invalidate your cover if found out. You could potentially face an insurance fraud conviction, which will affect any future attempts of obtaining insurance.
4) Get the family involved
You can normally get a sizeable discount with multi-car policies. It might be an idea to talk to your family if you’re in the same household and see how you could save money.
This is where an insurance broker can step in and add true value. They will search a panel of insurers to find the best available deals that suit your needs; they can incorporate motorcycles, quad bikes and many others. Many brokers can obtain preferential prices against purchasing insurance direct. It’s worth checking out!
5) Pay your premium annually
For many, paying a monthly amount is easier to digest, but it could be costing you more in the long run. There is normally a fee for the advantage of paying monthly, so if you can afford it, pay for your insurance in full.
6) Location, location, location
Thinking about moving? The area of the country you live in can heavily affect your insurance premium, down to postcode level. For example, the average cost of car insurance in London is £1,324.25 per year, compared to Aberdeen which is only £579.41 in comparison.
Factors include population and traffic density, the amount of accidents and personal injury claims in the area, as well crime rates. Generally speaking, if you live in a busy city with a postcode in the centre of town, complete with complex junctions and roundabouts, your insurance premium will be higher than a quite village on the outskirts.
7) Only pay for the cover you need
Car insurance can come bundled with a host of extra features. Some insurers include them as standard, whilst some are optional extras. Examples include:
- Legal assistance
- Breakdown cover
- Courtesy car cover
- Personal accident cover
- Windscreen cover
- Protected no-claims bonus
8) Beware the third party fallacy
There’s a misconception that fully comprehensive insurance will always be more expensive than third party cover, due to the increased coverage you are receiving, however this is not always the case. As there are various factors that build up an insurance premium, it can sometimes be cheaper to obtain the extra cover. It’s worth checking out both to give you a bigger picture on the prices available to you.
9) Invest in safety features
We like to think modern cars are very secure, but unfortunately fancy keyless entry systems have proven to have a few vulnerabilities. As such, relatively low cost items like steering wheel and handbrake locks are a good visual and physical deterrent to thieves. Additionally, Thatcham approved alarms and tracker systems can also reduce premiums.
With the advent of technology such as Autonomous Emergency Braking (AEB) systems, where brakes are automatically applied when they sense a collision is about to happen, we could find cars specified with these options result in cheaper premiums as they prove themselves as features to reduce accidents.
10) Increase your excess
Most insurance policies will carry some sort of compulsory excess, which is unavoidable. However, voluntary excess is a great way to save some money. Increasing voluntary excess shows the insurer that you are prepared to contribute more in the event of a claim and will tend to lower your premium. Of course, make sure you are in a position to be able to afford the excess if the worst was to happen.
11) Be accurate with valuing your cars
Your car may have been worth £15,000 when you bought it, but it’s unlikely to be worth the same from that moment on. So given insurers will only pay out against current market valuations, you are potentially throwing your money away by insuring a car at a higher amount.
It pays to check, so keep an eye on values by using a website such as Autotrader - just select the highest valued vehicle which has similar criteria to yours (mileage, age, condition).
12) Choose your parking spot carefully
Where you park your vehicle overnight will influence your premium. It goes without saying that thieves strike more often at night and a vehicle that’s easily accessible is more vulnerable. So, if you have a garage, consider throwing out the junk and placing your car inside for the night.
If you don’t have a garage, still take time to consider where is best to leave your car. You want to avoid vandalism and accidents which would incur a claim, and therefore affect your premium. Little things like folding your mirrors in, and ensuring valuables are removed before you leave the car could be the difference.