How to cut the cost of car insurance

When you think about the costs of getting a car, it’s easy to mistakenly assume that covering the cost of the purchase itself is the hard part, and that once that’s out of the way, you’re home and dry.  Unfortunately, that isn’t necessarily the case.  Firstly, buying a car in this country is actually relatively cheap, and with all the ways of financing the purchase of a vehicle, it need not have a massive impact on your immediate budget.

But it is the running costs of being a vehicle owner which take many people by surprise.  Maintenance, fuel, repairs, MOTs, insurance – it all adds up very quickly, and can put strain on anyone’s finances.

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The good news is that when it comes to insurance, there are straightforward ways of trimming costs. Given that the cost of insurance is now 17% more than it was at this stage last year, any savings can make a big difference.

Don’t just go 3rd party automatically

Many people just assume that 3rd party insurance is cheaper, but car insurance premiums don’t always follow logic. Some insurers will automatically assess you as lower risk simply by selecting comprehensive cover.  That could mean you get more cover for a lower cost – or possibly the same cost.  It will vary from person to person, but it’s well worth giving it a go.

Tweak your job description

It may sound a bit shady, and by no means am I encouraging you to lie.  However, subtle ‘enhancements’ of your job position will do your cause a lot of good.  For example, if you find yourself in a grey area between secretary and PA, the latter may reduce your premiums.  As would the inclusion of any type of managerial role.  Again, it’s not a case of lying.  But if you do have some potential leeway here, use it!

Try pay annually

It can be a bit of a burden to pay for a whole year’s worth of insurance upfront.  But paying it monthly is akin to getting a high-interest loan.  The extra amount you end up paying can easily be in the hundreds of pounds, so if you can square it away early, do so.  If you have trouble finding the funds, it may be worth putting it onto a 0% credit card for spending.  That way you can pay it off at your leisure, without incurring any interest.

Never renew automatically

You would think companies would reward loyal customers. Instead, they almost always take the mickey.  Numerous cases have come up where people end up paying more than double on a renewed, identical policy.  Crazy, right?  But it’s a case of insurance companies preying on consumer inertia, and assuming that they can’t be bothered to make a change.  Don’t be one of those – shop around for alternatives towards the end of your insurance term, and save hundreds of pounds.

Try lock prices for the future

Seeing how insurance costs have gone through the roof, the thought of going all in at current prices won’t be appealing at first glance.  However, all signs are that upward trends are going to continue for the foreseeable future. So try lock in today’s prices for tomorrow.  No, that doesn’t mean committing to a policy for five years.  But what you should do is note that some firms such as Aviva offer quotes which are valid for as long as 60 days.  What this means is that up to two months before your current policy ends, you can shop around, lock in those prices, and sign on the dotted line for that particular deal when the time for renewal/a new policy arises.

It all amounts to significant savings and easy wins, and allows us as consumers to turn the tide.  With a bit of initiative, we can beat such unreasonable inflation, especially given that many of us are already paying extortionate amounts for car insurance as it is.

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1 Comment

  • Reply
    Plutonium Sox
    December 12, 2016 at 10:56 pm

    Wow, a 17% increase in a year, that’s shocking! I definitely need to check out what I’m paying and implement some of your tips!
    Nat.x

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