Car insurance prices have gone through the roof recently with the MoneySupermarket.com car insurance division reporting that the average driver pays £921 for cover.
Newly qualified and younger motorists have been the worst hit by these increases, with an 18 year old male driver with a 1.25 litre Ford Fiesta set to pay £7,000 per year for insurance alone. However, there are things you can do once you have passed your test to obtain cheaper car insurance offers.
Choose your car wisely
Every make of car is assigned to an insurance group numbered between one and fifty. Cars in insurance group one are generally the cheapest to insure, and this is usually determined based on vehicle performance, security features and the statistical likelihood of someone owning that make of vehicle being involved in an accident.
Young and newly qualified drivers should therefore opt for a car in the lowest insurance group possible in order to benefit from cost savings. You can find out which group the vehicles that are in your consideration set have been assigned to using the parkers.co.uk car insurance group’s tool.
Security features and parking
If your vehicle does not already have them, the addition of approved alarms and immobilisers will lower your car insurance premiums as it will reduce the statistical likelihood of your car being stolen. Insurers will recognise that it is less likely that they will be forced to make a big pay out and will therefore reward you in the form of cheaper car insurance quotes.
Another way to reduce premiums through lowering the statistical likelihood of a claim being made is to park your vehicle in a secure location such as a locked garage rather than on a public road when at home. However, do not lie about any of this as it would give the insurance company a legal excuse to avoid paying out in the event of a claim being made.
The factor which has the biggest influence on car insurance prices is the driver, with age and experience levels taken into account by insurers.
There is not much you can do about your age, but you can improve your experience levels by completing advanced driving courses such as pass plus, which could cut as much as 30% off your car insurance quotes.
You can add “named drivers” to your policy to help bring down premiums. Ideally these people should be older than you and with more experience, possibly a parent. The insurer will assume that the two of you will be sharing the driving, even if this is not the case, and it will result in cheaper car insurance prices with the amount saved varying depending on the named drivers age and experience levels.
In the past people have actually been using the older and more experienced named drivers as the main policy holder, with the younger/less experienced motorist as merely the named driver. If this is a lie and the younger/less experienced driver is actually going to be the main user of the vehicle, then this practice would be known as “fronting” and is illegal.
Set a higher excess
Excess is the amount of money that the driver is agreeing to pay out in the event of a claim being made. Obviously the higher the excess level, the less the insurer will have to pay out when a claim is made. Insurers recognise this by offering cheaper premiums to drivers who offer to pay a higher excess.
However, it really is not worth offering to pay more than you can afford because the insurance cost savings possible through this are not half as high as what is possible through your choice of car, addition of named drivers or completion of pass plus.
Get only what you need
There are three different levels of car insurance cover to choose from:
Third party- Insurer guarantees to pay the costs of damage to other people’s property but will not cover the policy holder’s costs when damage is caused to their own vehicle.
Third party fire and theft- Insurer guarantees to pay the costs of damage to other people’s property and will offer marginal protection to the policy holder’s vehicle in the form of covering fire damage or theft.
Fully comprehensive- Insurer guarantees to pay the costs of damage to other people’s property and to the drivers own vehicle.
Fully comprehensive obviously costs the most as the package contains the highest level of cover. This is therefore the best option if you can afford it.
However, you may have an old banger worth under £500 and feel that paying extra for fully comprehensive simply isn’t worth it. This makes perfect sense and don’t be frightened to opt for the bare legal minimum (third party) in such situations.
Get on your bike
The more miles you complete, the more likely it is that you will be involved in an accident and make a claim. Insurers are well aware of this and will therefore offer cheaper deals to motorists with a smaller mileage allocation.
However, do not set a mileage allocation that you know you will exceed as this will give the insurance company another legal excuse to refuse to pay out when a claim is made once the allocation has been exceeded.
In order to ensure that you are getting the best deal available you should compare prices available through every different car insurance company on the market. Ordinarily this would be an impractical individual task as there are hundreds of insurers, but using a price comparison website makes it viable.