One of the most common questions asked is how to save money on car insurance. Below are a few tips that may help you save a little bit of that all important cash.
1. Shop around
Long gone are the days when customers were rewarded for their loyalty. Huge savings can be made by shopping around, even for those who have built up a good no-claims bonus. There is an abundance of comparison sites available online to help you find the best deal on your car insurance, these include: moneysupermarket.com, confused.com, comparethemarket.com, tescocompare.com, and gocompare.com. Note: some insurance brokers, such as Direct Line and Norwich Union, are not available through price comparison websites and will require you to visit them directly.
Once you have shopped around and found that all important deal, it may be worth calling your existing insurer to see if they can match your deal. Your custom is still important and many insurers will try to match any deals found on price comparison websites by giving you discounts, usually saved for new customers. This doesn’t always work however, if you are one of those people that, for whatever reason, finds comfort in staying loyal to one insurer, it doesn’t hurt to ask.
2. Don’t pay up front
Don’t be fooled in to thinking that paying for your car insurance in monthly installments is cheaper because it is NOT. Most insurers will charge interest, typically 24pc per annum, adding an average of £50 to your annual car insurance bill. If you can’t afford to pay monthly, use a credit card with a lower interest rate.
3. Increase your excess
Agreeing to pay a higher excess (the amount you must pay yourself when you need to make a claim) can significantly reduce your car insurance premium however, beware, the bigger your excess, the more you will have to pay out if you have to make a claim.
4. Don’t make small claims
Making small claims can increase your renewal premium and invalidate no-claims bonuses. Try to avoid making claims for anything less than £500.
5. Secure your vehicle
Fitting a Thatcham approved alarm or immobiliser can help drive down your premiums. Many insures recognise the benefits of such devices and most, including comparison sites, allow you to choose from a selection of recommended Thatcham approved security devices when retrieving a quote online.
6. Don’t “Pimp your ride”
Your car may look cool however your modifications may burn a hole in your pocket when it comes to insuring your vehicle. The more modifications you make the more you may be charged. Some insurers may not even insure your vehicle if it has been modified.
Note of caution: Always make sure that you inform your insurer of any modifications to your vehicle, whether made by you or not, any undeclared modifications may invalidate your insurance.
7. Fine-tune your job description
Insurers make valuations based on risk and some careers are more risky than others when it comes to renewal quotes. Fine-tuning your occupation can save you money. Martin Lewis’ MoneySavingExpert.com has a fun Car Insurance Job Picker tool to help you fine-tune your job description and find out which jobs insurers class as the riskiest.
Note: You must always be honest about your occupation. If you decide to fine-tune your job description, make sure it is reasonable and accurate. Lying about your occupation may invalidate your insurance.
Final tip: Add additional drivers to your policy
It may sound silly however, adding an additional driver to your policy can sometimes bring your renewal quote down, especially if the additional driver is an experienced driver with a long history of having no claims.