How to get the lowest car insurance premium

Looking for ways to trim your outgoings isn’t always easy, but it needn’t be unpleasant into the bargain. Here are some top tips for consumers to find the lowest car insurance to help ease the strain on their wallets

Like it or not, if you drive a car, you have to buy car insurance. Recent research by MoneySupermarket revealed that one in six UK motorists doesn’t appear to think a premium is necessary, but they are breaking the law. It means that if they were involved in a crash, they could face thousands of pounds in liability, a conviction, thousands of pounds in fines and points on their licence. So premium dodging is a bit of a false economy to say the least.

But despite Britain’s austerity measures causing consumers to rapidly run out of notches to tighten on their financial belts, there are ways to make sure you don’t pay over the odds for your car insurance premium. It’s worth taking a little time to look at the types of various insurance on offer to see which one is right for you.

What types of car insurance are there?

Third Party
This is the bare minimum level of cover legally required. Third Party covers the driver for any damage he or she causes to another person’s vehicle. It also protects any passengers in the insured person’s car. But it means that if you are involved in an accident which is your fault, you’ll have to meet the costs of repairs to your own vehicle.

Third Party Fire and Theft
This type of premium offers the same level of cover as Third Party, only with added protection in the event that your vehicle is stolen or set on fire.

Fully Comprehensive
As the name suggests, fully comp covers a much wider range of circumstances and is the highest level of protection. For a start, if you are involved in an accident which was your fault, any repairs needed for your own vehicle will be covered, along with personal injury expenses and it will also cover the other drivers involved, along with repairs you might have caused to their vehicles in the accident. This type of cover also offers protection against accidental damage, vandalism, fire and theft.

So which cover should I choose?

Third Party can sometimes be adequate for cars worth less than £1,000 and certainly for cars worth £500 and below, otherwise the annual policy price will probably be higher than the cost of replacing the vehicle. Other car owners choosing this basic level of cover tend to be newly qualified or young drivers (aged 17 to 25), although if you do not have a no-claims bonus, or you live in what’s considered by insurers as a ‘high risk area’ the premiums on Third Party might well be a cheaper option. Car insurance is something of a postcode lottery and parts of some large cities such as Manchester, Liverpool and Birmingham have often been cited among the most expensive places in the UK to insure vehicles, while less densely populated, rural areas such as the north of Scotland can prove cheaper in terms of insurance premiums.

Fully Comprehensive policies are more suitable for drivers whose car is worth upwards of £1,500. You might think Third Party would be the cheapest option, but that’s not always the case, as many providers offer competitive comprehensive deals. Another point to bear in mind is all insurance premiums are calculated on risk, so it can often be the case for whatever reason – age or location, for example – that a driver choosing Third Party cover is viewed as statistically a higher risk than one selecting Fully Comp, therefore the more basic cover will cost as much, or more, than the full cover.

What factors can help me to get lower car insurance premiums?

Even though insurers consider age and location when calculating car insurance, there are other criteria that come into play – and these factors can help make considerable reductions to policy premiums.

Where you park you car
This can have a significant effect on how much you have to pay for car insurance. If you park on the street overnight, this is seen as a higher risk, as your car is less protected from potential theft, damage or vandalism, so the insurance will cost more. Parking in a driveway is a bit safer, so that means cheaper insurance, while parking in a locked garage overnight means your car is at a much lower risk of being stolen or vandalised, which will drive down the policy price. Adding security measures can also cut costs, so think about fitting an alarm or immobiliser.

Driving history
If you’re a safe driver, this will help when it comes to premiums, so always take care on the roads. Any offences such as speeding or using a mobile phone at the wheel will send your insurance costs soaring.

Size matters
The bigger the engine, the more you will pay for your car premiums. According to data from uSwitch.com, the cheapest cars to insure at the moment include the Chevrolet Spark, Citroen C1, Fiat Panda, Vauxhall Corsa Hatchback, Volkswagen Fox and Ford Fiesta. Also bear in mind if you’re buying a brand new car, you might get free insurance thrown in.

Consider the excess
A higher excess on your policy can reduce your premium – but first, think about how much you would realistically be able and willing to pay for repairs in the event of an accident.

Cut your mileage
Look at ways you might be able to cut your mileage, as fewer miles per year can lead to a lower insurance price. Are you able to car pool with work colleagues or take the train or bus instead?

Black Box insurance
Black Box or Telematics insurance is a new option aimed at cutting the cost of car policy premiums for young drivers. Those who sign up have a small tracking device fitted to their car which monitors how safe their driving is, which can result in a discount in premiums.

Always shop around for quotes
Price comparison websites can be helpful when looking for car insurance, but remember to look at the insurers that don’t use comparison sites. Buying online can often result in a discount – and instead of accepting a renewal quote from your current provider, try haggling, or start from scratch and calculate how much it would cost with your present insurer as a new customer, then re-apply.