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How to reduce the costs of car insurance

  • 3, Aug 2020
  • Read time: 5 mins
If you would like to save some money on your car insurance, there are a few things you can do to help reduce the cost. Though there are factors about you that you can’t control, such as your age, job and address, we’ve shared some handy tips on what you can do to help reduce your car insurance premium.
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Buy the right car

Insurers do not base their risk assessments on a single metric, such as car insurance groups. Their calculations are also based on other elements, such as fuel type, style and age, doors, length of ownership and purchase price.

Therefore, while a high insurance group doesn’t necessarily mean high risk or price, this is still generally the case. So, car insurance groups are very useful when trying to understand how reduce your car costs.

As a general rule, higher performing cars with larger engines are considered to be a greater risk for insurers. This places them in a high risk group, making them more expensive to insure.

In total, there are 50 groups; group 1 being the lowest risk to insure and group 50 being the highest risk to insure.

Group 1 includes:
  • Volkswagen UP - varies from group 1 - 17
  • Fiat Panda - varies from group 1 - 12
  • Skoda Citigo - varies from group 1 - 12
Group 50 includes:
  • Audi R8 - varies from group 48 - 50
  • Porcshe 911 Carrera - varies from group 48 - 50
  • Jaguar F-Type - varies from group 41 - 50

This is an important factor to consider when buying a car as it can affect the cost of your car insurance. Find out more about car insurance groups.

Choose the right insurance

We offer two types of car insurance; Comprehensive (more commonly known as Fully Comp) and Third Party, Fire and Theft cover. Whether one is cheaper than the other depends on factors such as your personal circumstances and the car you drive. Third party, fire and theft may offer you an initial saving, but might become less cost-effective if later down the line you have an accident and your chosen cover does not meet all your needs.

Understanding their key differences will help you pick the right cover and make sure you’re not paying over the odds for your insurance.

Comprehensive

Comprehensive car insurance covers you for damage that you cause to someone else’s car or their property. You’ll also be covered for damage caused to your own vehicle. For most drivers, this type of insurance is the most complete way to insure their car.

Third party, fire and theft

Third party, fire and theft will cover you for damage made to a third party in the event of an accident, but your own car will not be covered. You will have cover against fire damage or theft for your own car. Find out more about our third party, fire and theft cover.

Get your excess right

When taking out a new policy or renewing your current car insurance policy, tweaking your voluntary excess can affect the overall cost of your car insurance. By increasing your voluntary excess, your overall premium may be cheaper. Make sure you can afford to pay both voluntary and compulsory elements of your excess should the unexpected happen.

Protect your No Claim Bonus

The more years you have on the roads without losing your No Claim Bonus, the cheaper your car insurance will be (if the insurance is in your name, and not as a named driver on another person's policy).

When you make a claim on your car insurance you will typically lose 2 years of your No Claim Bonus, so you may want to consider a NCB protection add-on. This is an optional extra but it's worth considering, as no matter how many claims you make you won’t lose your no claim bonus. This may contribute to keeping your insurance costs low in the future.

Make sure your car is secure

When picking an alarm, it’s advised to fit a Thatcham approved alarm, tracker or immobiliser. Thatcham is an independent institution that rates car security. They have 7 different categories for car security, with the most robust being the first class category. Having a Thatcham certified alarm may help to minimise theft if an attempt is made to steal your car and the alarm goes off. However, a good steering lock will be also be useful as a deterrent, and will help to minimise damage made to the vehicle during an attempted theft.

Get a black box fitted

If you’re aged 17-24, your car insurance is typically more expensive because you have less driving experience. By getting a telematics black box fitted, we can monitor your driving style and you can get rewarded for driving safely with SMART WHEELS young driver insurance. If you get a good driving score, this will be taken into account when we calculate your car insurance renewal.

Your black box will record information such as:

  • Your speed
  • How smoothly you drive
  • Your usage

Being a better driver helps to save money. For example, the smoother your drive the more fuel efficient your car performs. Not only that, but you'll be safer on the road while earning rewards on a pre-paid card that you can spend on the high street.

Additional ways to reduce the cost of your car insurance

  1. Mileage: Take time to calculate how much you use your car in a year to make sure you add an accurate mileage amount on your policy. By over-estimating your mileage, you could be increasing your overall costs.
  2. A clean driver’s licence: Being a safe and sensible driver with zero points on your licence will help keep your car insurance costs down.
  3. Optional extras: When buying or renewing your car insurance, it’s important to take time to review the optional extras on offer. Be sure to add what’s right for you. As although there may be an initial cost, it may help you in the long term if you need to make a claim.

Taking time to understand your car insurance, how it can help when making a claim, plus adding all the correct information, will help to make your car insurance work for you.

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