Cut Car Insurance Costs

Note: If you want to cut car insurance costs, you've got plenty of options. It's one area where you can save substantial amounts of money without changing your lifestyle or reducing the use you get from your car.

Car insurance is a classic example of a stress purchase. It’s a necessary evil, something that all drivers must have, but few people want so spend time arranging. So most people just accept the first quote that they’re offered. So it’s not surprising to learn that the average driver could cut car insurance costs by over $300 dollars a year if they shopped around for a better deal.

But most drivers remain with the same insurer, unaware that big savings could be just a phone call or a few mouse clicks away. They take the easy option AND WASTE MONEY!

So to help you get a better deal on your car insurance here are some general tips on how to lower your premium. But as you read them bear three things in mind.

Level of cover: Make sure that the cover you purchase meets your needs. There’s no point buying insurance that will only cover you for the bare legal minimum just to save some money on the premium, if what you really need is fully comprehensive insurance cover.

Compare like with like: When comparing different policies, ensure that all of the extra elements included are the same so that you can compare like with like. Otherwise your impression of which policy offers the best value will be distorted.

Quality of cover: Remember, the cheapest insurance cover that you can find is not necessarily the best. The overall quality of cover that you receive is also important. Right, here goes...

General motor insurance saving tips

Consider using an insurance broker, they’re likely to be able to offer you a better deal than you could negotiate yourself because of their greater bargaining power. This applies particularly if you’re a special case, such as a previously convicted driver, under 25 and/or driving a performance vehicle.

Shop around. It’s tempting just to stay with the same insurance company each year, but that dreaded inertia can cost you money. Never renew your car insurance until you’ve got a range of different quotes to compare what is on offer.

There are hundreds of competitors and the cheapest quote can often be up to 50% cheaper than the most expensive. Even if you don’t switch insurers you should still be able to use these quotes to beat down your existing insurer’s quote. Shopping around is VITAL for new drivers, especially if you’re young. Typical first year quotes, even for the smallest cars can easily cost thousands of dollars.

Always check whether there is a further discount for online insurance deals.

The situation is rather different for older drivers. Insurance companies generally like careful drivers, driving sensible cars (no Dodge Vipers then!) aged between 55 and 65. Low insurance premiums are at their mercy. But premiums rise sharply once drivers are aged over 70. Shopping around no longer makes sense. Insurance companies are often reluctant to cover new customers over this age. If you’re in this position, remaining with your current insurer is likely to be your best option. However, a clean record will make it easier to find a cheaper insurance policy elsewhere.

Some companies avoid high risk clients, such as young people or convicted drink drivers, by quoting massive premiums. Be aware of this and look elsewhere for cover.

Always pay your premium up front annually rather than monthly or quarterly as these options are more expensive. This is due to higher admin costs, and your insurer will lose out on the investment potential of your premiums. If your insurer provides credit, this can often be expensive (in the 20% plus APR price bracket!). If you can’t afford to pay the premium for the entire year, your credit card may provide a cheaper source of credit than your insurer.

Next: Lower Car Insurance Quotes

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