Car insurance is one of those necessary, but painful, expenses you wish you could do without. You can’t do anything about your driving experience, job or age, all of which affect your quote, but there are several legal ways to get that premium down. Here are the insider tips.
1. Shop Around
The insurance industry is highly competitive; it pays to shop around. You could even try phoning up, as companies desperate for your business may be happy to undercut a competing quote. Don’t just compare prices though, says Paul Davies, head of business diversification at insurance data and software supplier Audatex. Different policies will offer different benefits, such as courtesy cars, commuting use, foreign cover, roadside assistance and legal expenses. He says: ‘Make your decision after checking prices on comparison sites and from insurers direct and also contact specialist brokers to find an insurance policy that offers the right balance between price and coverage to suit your needs.’ Your premium will most likely fall if you decline many of the additional benefits.
2. Invite Big Brother Into Your Car
You can significantly reduce the price of your policy by having a black box fitted in your car to record your journeys and driving. ‘This means that the better you drive, the less you pay; and, as well as offering potential savings, many telematics providers also offer additional incentives for good drivers. But be warned, driving poorly and at speed can mean that your premiums will go up as a result,’ says Davies.
3. Get a Policy In Your Own Name
Young drivers in particular are often insured as a named driver on one of their parent’s policies. ‘While this may save some money in the short-term,’ explains Davies, ‘it means that you won’t establish a driving history of your own, which, in the long run, will end up costing you more.’ He also warns: ‘Adding somebody else as main driver if they’re not is referred to as “fronting” and is considered a type of fraud. If caught, you can face a criminal conviction and your insurance will be invalid.’
4. Add a Named Driver
If you have recently passed your test, are under 25 or have previous claims or convictions, insurers will deem you part of a high risk group. ‘If a responsible and experienced driver is likely to use the car, adding them to your policy may reduce the cost of your quote,’ says Kasey Cassells, insurance expert at uSwitch.com. You must still be named on the policy as the main driver, however.
5. Choose Your Car Carefully
The make and model of the car you are looking to insure can make a vast difference to the cost of your car insurance, says Cassells. ‘Not only are some cars more expensive to repair or replace than others, but some models are seen as high risk, because they are frequently involved in claims. For a lower premium choose a smaller car with better safety features.’
7. Drive Less
Car insurance premiums are calculated on risk. The law of averages says, that the more miles you drive the more likely you are to be involved in an accident. Get your annual mileage down and you may be able to get your premium down. ‘Your MOT certificates will show mileage from previous years,’ says Cassells, ‘or you could track your weekly usage and use this to estimate your annual mileage. Just don’t lie about your mileage to get cheaper car insurance — if you have to make a claim and your mileage doesn’t match up, your insurer may not pay out.’
8. Up Your Excess
‘Insurers base their premiums on how much they are likely to pay out in the event of a claim. By opting to pay a higher voluntary excess, you are lowering the cost to the insurer by essentially offering to pay a larger part of the claim yourself. This is a great way of cutting the cost of your premium, but remember this amount will come out of your pocket if you do need to make a claim,’ says Cassells. ‘Choose an excess you can afford to pay and make sure the excess cost is no higher than the value of your car.
9. Pay Annually
Whilst paying in instalments helps you to spread the cost of your premium, you will end up paying more overall. ‘By paying for your car insurance in monthly instalments, you are essentially taking out a loan from the insurer with added interest rates. If you can afford to pay the annual cost upfront, you could save up to 20%’ reveals Cassells.
10. Protect Your No-Claims Bonus
For every year you drive without making a claim on your insurance, you will earn a no-claims bonus. A maximum no-claims bonus can result in savings of up to 80% on your insurance costs. ‘There’s no way to speed up this process, but you can improve your chances of getting cheaper car insurance in the future by protecting your no-claims bonus for a small fee. Your current insurance cost will increase slightly, but you could see big savings in the long run if you need to make a claim, as you would otherwise lose your accrued discount,’ explains Cassells.