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Tips for decreasing car insurance premiums

Thu, 03/01/2013 - 11:16am

Due to the fast approaching date for major changes to motor insurance prices following EU gender rulings (21/12/12), we are all racking our brains for ways to drive down our car insurance. The new laws mean that insurers cannot discriminate against a certain gender when devising premiums, and yes you’ve guessed it, with men paying considerably more traditionally – insurers would much prefer to increase women’s rates to equal men’s, rather than reduce men’s to equal women’s! With this in mind, we thought it would be beneficial to put together a number of tips that will hopefully minimise the inevitable increase in many of your motor insurance policies.

First of all, the quicker you act the more chance you have of beating the change for a year. If your renewal date is now, then great – you’ll miss the changing date, ensuring a cheaper policy that effectively will lock in at the current discriminated rates. If you’ve got a while left on your current policy, it might be worth considering whether you can cancel your current policy and sign up for a new 12-month one now. Many providers, if you haven’t claimed, will refund you for the part of the policy that is unused. However, they will probably charge an early exit fee, and it is also worth bearing in mind that you are unlikely to get a no-claims bonus for that year – so before you do anything it is wise to check your terms and conditions.

If your renewal date is around the 21st December (when the rule changes come into fruition) there is a greater risk of major change to your premium. This is because insurers can bring it in before this date if they choose, when some are providing the original discriminated policies until 11:59pm on 20th December – nobody knows exactly what will happen however, as some insurers are playing a waiting game to see what their competitors do so they can nip in, in an attempt to gain advantage any way they can.

Comparing the car insurance market, to see what is available is always advisable and if you don’t have an unusual insurance history, using online comparison sites can be an easy way to get a good price. When doing so, it is important to look at more than one as combining a few is more likely to provide better range of quotes because not all comparison sites search the same companies. The current top 3 sites for range are moneysupermarket.com, confused.com and tescocompare.com. The only downside to this however is that not all insurers are actually on comparison sites – noticeable absentees being Aviva and Direct Line.

One method that may be more beneficial for young drivers is to add a responsible second driver to your policy. This can cut costs because risks are being reduced. This doesn’t always work but can make a significant difference.

To argue a common misconception, third-party is not always the cheapest option. Why? Because by paying more for lesser third-party cover can statistically indicate to insurers that you’re a higher risk, so don’t assume it is the cheapest option – check comprehensive prices too. Once you’ve found your cheapest deal, it might be worthwhile to see if you can also get some cash back on it via websites such as topcashback.co.uk or quidco.com to hopefully bring the cost down further.

Opting for a telematics insurance policy, which is a recent introduction to the insurance industry, is arguably the most honest method of proving your worth for a particular premium. Telematics is when a box is inserted into your car to monitor your driving style which will be reflected in the policy offered to you. This is desirable, especially for young drivers as your insurance premium is based on the way you drive and not any factors out of the driver’s control.