12 ways to cut your car insurance costs

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There's no getting around the need for decent car insurance. Unfortunately, it's more expensive than ever – premiums are expected to hit a record high this year, averaging £900 a year.*

The good news is there are plenty of ways to save, try our 12 tips to help you reduce your annual bill.

Use comparison sites

You might have bagged yourself a good deal at the time, but the car insurance market moves quickly. The offers and prices change all the time as providers compete for customers, so it's always worth shopping around and comparing prices from a number of other providers before accepting a renewal quote from your existing insurer.

It's worth knowing that some of the big names in insurance (like Direct Line, Aviva and Zurich) aren't listed on all the major comparison sites. If you're interested in insurance from these providers then you might need to get a quote from them directly.

When you're comparing quotes, make sure you're comparing like-for-like in terms of the level of cover and the excess you would pay if you make a claim.

Let your insurer spy on your driving

Insurers increasingly use telematics or black box technology to measure how carefully you drive. Some insurers will install an actual black box device into your dashboard but often it's as simple as downloading as app.

The idea is to monitor things like; how fast you accelerate, or how suddenly you brake, and what hours of the day you usually drive, and then feed this data back to the insurer to assess the risk. Prove yourself to be low risk and you'll reduce your premiums since safer drivers pay less.

Don't let your kids drive your car

If a younger driver is insured on your car it can push your premiums up significantly because insurers see inexperienced drivers as a much higher risk.

It's usually much more cost-effective to add your children to your policy for a few days at a time as needed rather than naming them as a regular driver.

Add your parent to your policy

On the flip side, if you're a young driver then sharing a policy with a more experienced driver can save you money. Adding your parents name to your policy can, according to GoCompare, save you as much as £520 a year (based on a 18 year old living in north London and driving a Vauxhall Corsa).

Make sure you stay on the right side of the law. 'Fronting' is a term used for when a parent illegally names themselves as the main user of a vehicle when in fact it's usually driven by a younger driver.

Don't park on the street

This won't be possible for everyone but if you have the option to park your car on a driveway then you could save money.

Parking on the street can cost you more in premiums because some insurers say your car is more likely to be damaged or stolen, even if it's parked right in front of your house.

Pay upfront

Some insurers will offer cheaper deals if you pay for your full year's cover upfront instead of spreading the cost with direct debits. You can also often save by planning ahead and buying your car insurance a week or more before your cover needs to start.

Increase your excess

One way to cut your annual bill is to choose a car insurance policy with a higher excess if you need to make a claim.

The risk here is that you'll need to shell out more money if you do ever have to make a claim, so make sure that the excess is affordable before you go down this route.

If you're a careful driver and you live in a safe area you might feel that, on balance, the risk is worth it to cut your premiums.

Ditch the add-ons

Many insurance packages come with extras such as; breakdown assistance, windscreen cover or courtesy car cover. You might not need the extras and they may not offer good value. Strip away unnecessary extras and go 'no frills' to save money.

Take advantage of your no-claims bonus

If you've gone several years without having to make a claim on your insurance then most insurers will reward you with a bonus.

If you do need to make a claim, it might be worth protecting your no-claims bonus in order to keep premiums down in the future. Some insurers will let you do this by making a small payment upfront, and it usually works out cheaper in the long-run than losing your no-claims discount.

Grab a multi-car discount

If your household runs more than one car and they are registered at the same address then you can think about insuring them with the same provider to save money using a multi-car discount.

Be aware the some insurers won't offer you multi-car cover if one of the drivers splits their time between addresses, like at university for example.

Downsize your car

Driving a less flashy car (sorry sports car fans) or one with a smaller engine can make a significant different to your car insurance bill, so consider switching to a cheaper runaround if you want to save some cash.

Drive less

Again, not an option for everyone, but reducing your annual mileage can also reduce your insurance costs. Your insurer may let you agree to a lower annual mileage cap to cut your bill – low mileage is considered in the region of 7,500 miles a year.

Using your car for work, as well as leisure activities, will also push up costs so consider whether you could use a company car instead and keep your own car for pleasure - instead of business.


*https://www.moneyadviceservice.org.uk/blog/what-is-the-average-cost-of-car-insurance