One in three drivers pay over the odds for their car insurance, according to the RAC.
Make sure that you’re not one of them by following our top tips for finding the best deal on your car insurance.
1. Shop around.
It really does pay to shop around for your car insurance. Many insurers offer their lowest premiums to new customers, and then increase the cost in subsequent years. So you’ll probably find that your renewal quote is significantly higher than the quote you had for your first year of cover.
Even if you’re happy with your insurer, it’s worth seeing if a better deal is available elsewhere, and then asking your provider to match it.
2. Pay your premiums annually.
Many people value the ability to pay their premiums monthly as it helps them to budget. However, be aware that most insurers charge an admin fee to customers paying in instalments, and it’s common for them to also charge interest. As such, if you can afford to do so, paying your annual premium in one go will usually save you money.
3. Increase your excess.
When you buy car insurance, you’ll be asked to select your voluntary excess. This is the amount of money that you’ll have to pay towards any claim that you make, in addition to the compulsory excess set by your insurer.
Generally, the higher your voluntary excess, the lower your premium.
4. Protect your no claims bonus.
Your claims record is one of the most important factors affecting your premium. The more claims you make, and the more expensive those claims are, the higher your premium is likely to be.
Approaches to no claims bonuses (NCB) differ between insurers, but it’s not unheard of for 5 years worth of NCB to reduce premiums by up to 75%.
Many insurers give drivers the option to protect their NCB. This means that if you’re involved in an accident, you won’t lose your NCB (although check your policy carefully, as some insurers won’t protect your NCB if the accident is your fault).
Although NCB protection will add a few pounds to your premium, it could save you hundreds on the next year’s policy if you’re involved in a collision.
5. Secure your car.
As well as covering costs arising from an accident, car insurance will pay out if your vehicle is stolen (except third-party only cover). As such, insurers will often discount premiums if policyholders take steps to secure their vehicles.
Fitting an approved alarm, immobiliser or tracking device can reduce premiums by around 5%. Likewise, parking your car in a garage will usually lower insurance costs.
6. Only buy the cover you need.
There’s no such thing as a standard car insurance policy. Different policies will offer different levels and types of cover. Generally speaking, the more cover you buy, the higher your premium will be. So it’s important that you only select the cover that you really need.
For example, if you only drive your own vehicle, don’t add Driving Other Cars cover. And if you’re generally the only person who drives your car, don’t add other named drivers – if someone needs to borrow your car once or twice a year, buy temporary insurance to cover that period.
7. Drive safely.
Some insurers now offer telematics-based insurance products. These policies use technology – either a ‘black box’ installed in your car, or a smartphone app – to monitor when, where and how you drive. The insurer analyses the data collected to calculate a premium based on your driving behaviour.
Telematics policies can cut premiums quite dramatically once you prove that you’re a safe driver.
8. Drive a car in a low insurance group.
If you’re thinking of changing your car, it’s worth bearing in mind the cost of insurance before deciding on a particular model. Every car belongs to one of 50 different insurance groups that indicate the level of risk associated with it. The insurance group takes into account factors such as price when new, performance, repair costs and the cost of parts.
Generally speaking, the lower the insurance group, the lower the insurance premium.
9. Avoid modifications.
Modifications may look good, but performance upgrades and body kits make your car more attractive to thieves, and cost more to fix. As such, you’ll often find that modifying your vehicle will lead to an increase in your insurance premium.
10. Use a broker.
Last, but by no means least, use a broker to help you find the best value car insurance policy.
An experienced broker will help you to identify exactly what protection you need, so you won’t pay for cover you can’t use. They’ll also do all the shopping around for you - and because they’ve built good relationships with many different insurance companies, they’ll often have access to great deals that aren’t available to customers buying their insurance direct.