The average UK car insurance premium is £755 a year, so it pays to shop around. But beyond using a price comparison website, what can you do to reduce the cost of car insurance?
Firstly, never accept the renewal quote from your existing provider. There’s little reward for loyalty in the world of car insurance, so take a mercenary approach when your policy expires.
Either look elsewhere or haggle hard with your existing provider. You WILL save money.
New research shows how the price of a car insurance policy can change when altering just one factor at a time. Some of the findings might surprise you.
Higher or lower car insurance?
- Does reducing the annual mileage lower the premium? Yes, but the research by Moneyshake shows that reducing cover to 5,000 miles a year results in a discount of just £17.
- Decreasing your voluntary excess to £250 will save you 25 percent. Increasing it to £500 or £1,000 could actually result in a more expensive policy.
- Improving car security could increase the price. By adding a tracking device and locking wheel nuts, you’re modifying your car, which could result in a more expensive policy. Talk to your insurance provider.
- A third-party, fire and theft policy could be 60 percent more expensive than comprehensive cover. You could save a massive £448 by going ‘fully comp’.
- Drivers with a PassPlus qualification actually spend more on their car insurance.
- Be careful who you add to the policy. Naming your spouse can save you 25 percent. However, adding a child to the policy could increase the premium by 524 percent. Moneyshake’s research revealed that some policies went beyond £5,000.
- The cheapest cars to insure are the Nissan Micra, Volkswagen Up and Kia Rio.
- Paying annually instead of monthly will save you £109 a year. On average, a premium paid by direct debit costs 15 percent more.
- A no-claims bonus can save you £356 a year.
How to reduce your car insurance
According to Chill Insurance, here are some of the ways to reduce your car insurance premium:
- Drive safely to build up a no-claims bonus
- Correctly estimate the value of your car
- Use an online broker to search the market for you
- Estimate your mileage correctly. You’ll pay more for miles you don’t need
- Young drivers will see their premium decrease when they move from a provisional to a full driving licence
The research is this article was conducted by Moneyshake. Click here for more information.