How to save money on car insurance

How to save money on car insurance
September 22, 2016 Cheryl Lewis
How to save money on car insurance

Knowing how to save money on car insurance can be valuable. After all, car ownership comes at a considerable price.

According to figures published by The AA in 2014, the average cost of owning a cheap car used to travel 5,000 miles per year, stands at roughly £1450 a year. This is ignoring original investment and depreciation.

By taking steps to ensure you save money on car insurance, you will be doing your best to keep car ownership costs down.

Here are 14 steps you can take to save money on your car insurance when your renewal date next rolls around:

Finding the best car insurance quote

Do not accept automatic renewal

When your car insurance is due for renewal, you will probably receive a letter that thanks you for your custom. It will likely mention that your insurance policy will renew automatically.

You have the right to cancel the automatic renewal of your policy.

Often, you will find cheaper deals elsewhere.

Often, insurers offer their lowest quotes to new customers instead of rewarding existing ones.

This means that if you cancel your policy, then take out the exact same policy again, you could pay a lower price.

Use car insurance comparison websites

Comparing car insurance prices is one of the easiest ways to save money on car insurance.

Comparison websites will ask you to complete a detailed form with details about your vehicle and driving history.

The data that you provide gets fed into a portfolio of approved insurers, resulting in a list of quotes that you can compare to find the best price.

It is worth bearing in mind that the cheapest car insurance quote is not always the most suitable.

Insurance policies will vary, so look at the features and options as well as the annual premium.

Remember to visit direct insurer websites

Some insurers, such as Direct Line, do not feature on price comparison websites.

Do not miss the opportunity to get quotes from insurers that will not feature in your results list. They may make you an offer that is lower than any competitor.

Contact insurers by phone

Once you have found the best online quote, prepare to make a few phone calls. You may be able to haggle for a better price, by asking insurers to give their best offers.

If you get an automatic renewal price, running an online car insurance comparison is not a waste of time.

The price that you get online may be cheaper than your renewal quote. You can pick up the phone and ask your insurer to price-match your online quotation.

Keep your online quote reference number handy. Your insurer will be able to find the details. They can check the information matches what they already have on record, and bring the price of your renewal down.

Pay up-front

Insurers usually charge more if you pay in installments.

You will save money on car insurance if you can afford to pay in full at the start of the year, rather than spreading the cost by Direct Debit.

Changes that you can make to cut car insurance costs

Adjust the details

Exactly what you say on your insurance quote form can have an impact on your car insurance premium.

Do not lie about your details.

Anything that is incorrect could invalidate your insurance. This leaves you completely unprotected in the event of an accident.

There are legitimate ways to manipulate the details to potentially pay a lower price.

Your job title is one piece of information that you may be able to adjust. Try every genuine possibility.

If you run your own business, calling yourself a Company Director may result in a different range of quotes. You may find it cheaper to call yourself a Plumber, Electrician or Tutor, or could find that Company Director is the title that serves you best.

A Carpet Cleaner may receive different quotes using the more general title of Cleaner. Are you a Funeral Director, Mortician or Undertaker?

It is a must that you use a legitimate job title and that you are not misleading. If you can think of an alternative title that still describes what you do, then why not see if you get different quotes?

Add security to your vehicle

Lower insurance premiums get reserved for those that represent a low risk.

There are some things that you cannot control, such as your age, but also many things that you can.

If you can store your vehicle more securely, it may help to do so. Parking at the roadside is more of a risk than locking your car in a garage overnight.

You can also choose to install security features that your car does not already have.

If you own a vehicle not fitted with an alarm, then having an alarm installed could help you to save money on car insurance.

Adding security equipment will need a cost outlay, but there could be significant financial rewards for doing so.

Reduce your mileage

When applying for online quotes, play around with mileage estimates.

You cannot expect to exactly predict how many miles you will cover.

Be reasonable with your estimate. Base your prediction on your previous mileage if you are not expecting big changes to your driving habits. Consider adjusting your estimate slightly to reduce your car insurance quotes.

Sometimes, increasing your estimated mileage is better than decreasing it. You will need to experiment to find what works best.

See how much you could save if you really did reduce your mileage. If you are using your vehicle for short trips, estimate how your mileage would reduce if you started walking more.

You may be able to get cheaper car insurance by becoming less dependent on your vehicle, and as an extra benefit, you will also save money on fuel.

Get a fully comprehensive car insurance quote

There is a common misconception that third-party, insurance is cheaper than comprehensive.

In most cases, this is no longer true.

Comprehensive cover will possibly be the cheaper option when you are applying for car insurance quotes.

By taking out a comprehensive policy, you also protect yourself from future expenses. Expenses associated with car accidents that would otherwise leave you out of pocket.

Book onto a Pass Plus course

If you have not already done so (and particularly if you are a new driver), going through a Pass Plus course could help to reduce your insurance costs.

This course, at least 6 hours long, provides advanced training in driving skills and road safety. Some insurers offer discounts for drivers with a Pass Plus certificate.

You can take the Pass Plus course, with an approved driving instructor, at any time.

Build up and use your No Claims Bonus

If you go through a year without claiming on your car insurance policy, you will start to build up a No Claims Bonus.

Your No Claims Bonus is transferrable. You do not need to stay with the same insurer for year after year to benefit.

If you are moving to a new insurance company, ask your previous insurer for a No Claims Bonus certificate. This is the proof that you will need to send to your new insurance provider.

You may be able to reduce car insurance premiums by as much as 75% by applying your No Claims Bonus. So it is important that you remember to use it if you have earned it.

Consider a black box policy

Black box insurance policies need the professional fitting of a vehicle tracker that can check when and how you drive.

If you agree to use your car only during off-peak hours, and if you drive carefully, then you may get offered a lower insurance premium.

Be aware that driving during peak hours, past an agreed curfew, or breaking the terms of your black box contract may increase the amount that you pay.

Black box policies are becoming more popular, but are typically best suited to younger drivers. Especially those that have not built up any No Claims Bonus and are getting judged as a risk because of their age.

Use an insurer’s driving app

Black boxes are not the only GPS-enabled devices that can are used to reduce car insurance prices.

Some insurers, such as Aviva and Tesco, now offer apps that you can install.

If you choose to install the app, then leave it running whilst you are driving, your driving routes and habits will get recorded. The data gets sent to the insurer and you may get offered a discount if you have received a good driving score.

Your score is created using information such as your vehicle handling and speed.

Most insurance providers need you to drive for at least 200 miles before receiving your score. You should install the app far enough in advance of your insurance renewal date.

Buy a different vehicle

If you have tried everything to reduce your car insurance price but have found that quotes are still too high, drastic action may be the best way to save money on car insurance.

Insurance prices take the make, model and age of your vehicle into account. If yours is a particularly expensive car to insure then you may wish to sell and buy something that is cheaper to insure.

Buying a new vehicle may not be practical or sensible, but if you are looking at years of high insurance premiums, the change is worthwhile.

Always check insurance quotes before you change your car. The results may be unexpected.

Typically, expensive sports cars are going to be the most expensive to insure.

Older, cheaper and more run down cars may bring higher quotes than their modern equivalents. They lack the latest safety features and are more likely to break down.

Insurers will use past data to develop their pricing structure. Which means that vehicles more involved in accidents will cost more to insure than those driven by mature drivers.

Check yearly to save money on car insurance

Cutting car insurance costs involve a lot of trial and error.

Insurers will constantly be updating their prices, so what worked last year may not bring the same results this year.

Before accepting any car insurance quote, you should shop around and see what adjustments you can make.

Never accept an automatic renewal. Each year, you have a valuable chance to reduce the price of your car insurance policy.