Top 5 tips to cheaper car insurance
No matter how careful a driver you are or clean your license is it seems car insurance is getting progressively more expensive every year.
According to The AA, the average cost of a comprehensive policy rose by 11.5 per cent in the three months leading to June 30th this year.
Premiums for third part fire and theft cover also saw a sharp increase, rising by 15.9 per cent over the same period.
Fortunately, there are several relatively pain-free ways in which you buck this trend and lower your car insurance premiums; myfinances.co.uk has covered five of the best:
Shop around and compare
According to moneysupermarket.com, drivers can save an average of £233.81 a year by shopping around and comparing car insurance.
Despite this, around one in four drivers still prefer to renew their policy with their existing provider rather than search for a better deal. Of these, 10 per cent say they "can't be bothered" to put in the legwork to find a better quote.
Searching for a better car insurance deal isn't a chore, our car insurance comparison service powered by Confused.com only takes minutes to use and the savings can be huge.
Change your car
If car insurance is taking a major bite out of your finances every year then consider swapping your car for one that is cheaper to insure.
Obviously an Aston Martin DB9 is going to cost more to insure than a Renault Clio, but as well as the price and prestige there are other indicators which will bring insurance premiums down such as:
- Emissions - Many cars these days are designed to be eco-friendly, these models tend to attract lower premiums as well as cheaper road tax.
- Engine size - if you are a city dweller then choose a model with a smaller engine, most drivers won't notice much difference between a 1.2 and a 1.8 engine when negotiating endless traffic lights and streets with low speed limits.
- Insurers classification - All cars are placed in groups numbered 1-20. The lower the classification, the cheaper the car is generally to insure.
- Safety rating - Check out the car's NCAP safety rating. The better the rating the lower the insurance will be.
- Reliability - Research reliability leagues and MOT failure rates. The most reliable motors tend to be made by Japanese manufacturers such as Honda, Subaru and Toyota (despite their recent problems). Insurers will favour cars with a good reputation for lasting a long time while needing minimal repairs.
If you'd prefer to keep your car, then look for ways to make it more insurance-proof.
For example, getting an alarm, immobiliser and/or tracker professionally fitted can bring down premiums significantly.Pay the premium in one go with an annual payment
Paying your car insurance premium almost always works out cheaper than paying by instalments. You avoid costly interest charges and many insurers provide an extra discount for paying in full.
It may even be worth taking out a small personal loan to cover a single payment rather than shelling out for the insurer's costly APR.
Don't assume third party cover is cheaper
Many money-saving drivers fall into the trap of purchasing a third party, fire and theft policy under the assumption that it will work out cheaper than comprehensive cover.
According to the AA insurance index, a fully comprehensive car insurance policy cost on average £968 in the first quarter of 2010, compared to £1,196 for third party, fire and theft.
Again, use car insurance comparison services to compare the best deals offered by both third party and comprehensive policies.
Increase your voluntary excess
When applying for or comparing car insurance, adjust the voluntary excess field and you'll probably see the premium change dramatically.
Remember, if your car needs repairs resulting from an accident which was not your fault, you can recover the excess.
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