There are over 33 million cars traversing the roads of the UK. For these drivers, having car insurance is required under UK law to protect other road users. While it is a fact of life that such insurance can be costly, it is also true to note that a percentage of drivers exists that either by choice or inability, does not possess such insurance. That said, car insurance need not break the bank! So, how do you go about reducing your premium?
Firstly, consider the type of cover you need. The minimum, legal requirement in the UK is third-party insurance. This type of insurance covers other road users against damage caused in an accident and is usually the cheapest option. It is most often used to insure older, less valuable cars where fully comprehensive policies may not provide value for money. For an extra premium, the policyholder can insure against fire or theft of the vehicle. Fully comprehensive policies, on the other hand, provides extensive cover for both your vehicle and other road users. Furthermore, fire and theft insurance is included in the cost. While a little more costly than third-party, many drivers with higher value cars tend to choose fully comprehensive policies – many of which offer added benefits such as breakdown cover, foreign travel cover and medical assistance in the event of an accident.
Secondly, decide on whether or not you would want to pay something towards the cost of a claim. This payment is known as ‘excess’ in the UK and most insurers will offer a discount on the cost of a motor insurance policy if the policyholder offers to pay part of the claim. All insurance policies have a compulsory excess amount, which must be paid regardless, but it is up to the individual if they want to volunteer to pay part of the claim. Paying a higher excess often leads to higher discounts, as insurers equate the level of excess with the heightened level of care a driver is likely to take if they have to dig deep into their own pockets in the event of an accident!
Thirldy, secure your vehicle. Fit an insurance-approved alarm and engine immobiliser, and use a ‘krooklock’ – a metal rod that fits across your steering wheel. Having an alarm fitted and a visible anti-theft device can sometimes knock as much as 10-15% from the cost of a policy. Also consider fitting a GPS tracking system, which can help police recover your car quickly in the event of a theft. It should, however, go without saying, but always be sure to lock your vehicle whenever you leave it. If you leave your car unlocked and it is subsequently stolen, it’s highly probable to invalidate any insurance claim you make.
Also consider the amount of driving you actually do. Most insurance quotes are based on the average yearly mileage, but if your annual mileage is lower than the average – thought to be 8000 miles per year – you could save on your premium. In the eyes of insurance companies, the less you drive the less likely you are to have an accident.
Another way to lower your premium is to further develop and hone your driving skills. In the UK, 1 in 5 first-year drivers are involved in an accident, so if you’re a new driver, consider taking an advanced driving course, and it could be worth up to 30% off your next premium. These courses help train new drivers on aspects of driving they might not encounter during normal testing, such as motorway driving, all-weather driving and driving at night.
An often overlooked way of lowering your premium is to shop around. Don’t settle for the first quote you receive, but use it as a bargaining chip instead. Other insurers will often try to beat competing premiums, so shopping around can often unearth a real gem. Use online price comparison sites to search the car insurance market quickly and compare rates, as some companies offer a discount to users who arrange their cover online. Alternatively, call the top performing companies and ask them to beat the online quote – you might be surprised by the offer, as some insurance companies hold a ‘discount pool’ which they can use to reduce your premium further. However, if you don’t ask, you won’t receive!
Above all, the best way to ensure you receive the best possible insurance premium is to know your limits and drive within the law. Getting a speeding ticket won’t do your insurance premium any favors, and certainly won’t make you popular with the police. Furthermore, there is a direct correlation between driving at speed and being involved in an accident. Put simply, the faster you drive, the more likely you are to crash.
Staying trouble-free will result in not just your insurance company rewarding you with a lower premium come renewal time, but other drivers will also benefit from your being a safe and careful driver.