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Ten tips to reduce car insurance costs

Kasey Cassells
Written by Kasey Cassells, Senior content editor

Edited by Dan Moore, Finance Writer, 8 December 2021

No one wants to pay more for their car insurance than necessary. Fortunately, there are things you can do to get lower car insurance. Here are 10 car insurance tips you can’t afford to miss.
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Saving on car insurance with our top tips
Top 10 tips for cutting the cost of car insurance

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There are many factors affecting car insurance that you can’t easily control, such as your age, years of driving experience and where you live. But if you’re serious about saving on your car insurance a few simple steps can save you plenty.

How to lower car insurance premiums - 10 car insurance tips: 

1. Choose your car carefully

The car you drive is one of the key factors insurers focus on when setting premiums. A large, powerful, flash, coveted, expensive model will cost more to insure than a basic, inexpensive runaround. While you might hanker after a zooped-up VW Golf or a BMW 3, these cars will cost a lot more than a Ford Fiesta, for example. 

While we’d all like to drive an impressive model, you could end up paying through the nose for the privilege. The classier your car is, the more it’ll stand out and attract thieves and vandals. 

Expensive cars cost more to repair, which explains why they are so expensive to insure. Also, they are quicker and more powerful, which means they tend to be in more expensive accidents. 

Before you buy a car, whether on finance or not, check what it’ll cost to insure first compared to a smaller, less powerful model.

2. Keep your car safe

Insurers will offer you a more affordable premium if you do your best to keep your car out of harm’s way. If possible, keep your car in a secure garage or driveway overnight, rather than on the road where it is in easy reach of thieves and vandals. 

You can reduce your premium further by installing additional security features, such as a tracker. If you need to park on the road, do so in a well lit area as thieves and vandals are less likely to target your car if they are in the spotlight.

3. Drive fewer miles

Car insurance premiums are usually more affordable for those who drive fewer miles — the more you drive, the greater the chance of having an accident. 

Most people estimate their mileage when getting a car insurance quote, so make sure you’re providing an accurate prediction. Your MOT certificates will show mileage from previous years, or you could track your weekly usage and use this to estimate your annual mileage. 

Make sure you don’t lie about your mileage just to get cheaper car insurance — if you have to make a claim and your mileage doesn’t match up, your insurer may not pay out.

How does driving to work affect my insurance premium?

If you use your car to commute to work your premium will be higher, as you are more likely to be driving often and at peak times, and the probability increases of you making make a claim. 

4. Pick the right level of cover

To drive on UK roads you must have car insurance, of which there are three levels:  

  • Comprehensive: the highest level of cover, this protects you, your car, other people, and their property, including their vehicle in the event of an accident 

  • Third party, fire and theft: won’t protect you or your car if it’s involved in an accident that you’re responsible for. But it will cover fire damage, theft or attempted theft. It will protect passengers in your car, if they are injured, plus other people and their property if they are in an accident with you for which you’re held responsible.

  • Third party: the minimum level of cover legally required to drive in the UK. This policy covers you for damage to other cars and property, as well as injuries to other people. But you will not be able to claim for any damage to your own car or person.

Although third party cover offers the least protection it isn’t necessarily the cheapest option. Always run quotes for this and comprehensive cover. This is because the profile of people selecting third party tends to be younger drivers, who lodge more claims, and those with older cars who don’t care too much if it’s damaged.

5. Consider black box insurance

Black box policies (also known as telematics, or pay as you drive policies) are another great way to save. As part of a black box policy, your insurer will install a small GPS-enabled device in your car or require you to download a smartphone app that monitors your driving. 

The telematics device encourages safer driving and also makes the car easier to trace if it’s stolen. The insurer uses data collected from the black box, to set your premium. This data reveals the quality of your driving, such as how fast you’re travelling, how sharply you brake and what time of the day, or night, you’re driving. The more careful you are over time, the lower your premium will be.

6. Think carefully about your job title

While you must be truthful when describing your job, it’s well known that certain jobs are considered by insurers as riskier than others. 

Take the catering industry, you could be a cook or a chef, no difference perhaps, but one description could add pounds to your premium. Never be misleading when getting quotes, but do think about how you can describe your role.

7. Add a named driver

You may consider yourself a safe driver, but insurers will group you into a high-risk category if you have recently passed your test, are under the age of 25, or have previous claims or convictions. 

If you are in one of these groups, you may be able to reduce the cost of your quote by adding a responsible and experienced named driver to your policy if they are likely to use the car. 

8. Protect your no-claims bonus

For every year you drive without making a claim on your insurance, you will earn a no-claims bonus. A maximum no-claims bonus, typically from around eight years can result in savings of up to 80% on your insurance costs. 

There’s no way to speed up this process, but you can improve your chance of getting cheaper car insurance in the future by protecting your no-claims bonus for an additional fee. With this added extra, which will cost a small additional premium, you won’t lose your no-claims bonus – although your premium may still rise.

9. Pay upfront for car insurance

Paying upfront for your car insurance can be a big hit to your bank balance, but it can save you a considerable amount over the year. By paying for your car insurance in monthly instalments, you are essentially taking out a loan from the insurer with added interest rates. 

If you can afford to pay the annual cost upfront, you could save 20% or even more depending on your provider.

10. Compare quotes 

One of the best ways to save on your car insurance is to shop around and compare insurers. Even if you’re happy with your current insurer, it’s likely you’ll save on your renewal cost by comparing quotes from other providers. 

Remember there are alternatives to the big-name providers — a specialist insurer may be able to give you a better deal if you’re in a high-risk group or have a powerful or modified car.

Get a car insurance quote

See a range of car insurance quotes in just a few minutes when you compare with Uswitch

Car insurance renewals - what else you can do

A proposal from the Financial Conduct Authority(FCA) aims to ban car insurance companies from hiking up renewal prices for existing customers. In light of this, we’ve explored how this could potentially impact the quotes for one year policies offered to new customers.

Tie the knot

It's true - research shows that married drivers make less expensive claims than singletons. As a result, insurers may offer you a more attractive insurance premium if your marital status is ‘married’.

Premiums can dramatically decrease by up to £200 for couples in their thirties, who make the most savings overall. 

Even if you’re in a traditionally ‘high risk’ insurance group, getting wed can give you an advantage. Whilst this may seem unjust, studies show that single drivers are at twice the risk of having an accident behind the wheel compared to people who have tied the knot. 

However, if you aren’t quite ready to get married but are in a domestic partnership, some insurers do offer specific discounts for couples living together. Some insurers feel encouraged to do this under the assumption you’ll spend less time driving alone.

Sign the electoral register

There are many ways to improve your credit score, and one of the easiest things you can do is to ensure you’re registered on the electoral register. 

Credit reference agency Experian says, if you are registered to vote, companies see this as a sign of stability by lenders and can therefore help any applications that consider your credit score.

Typically, appearing on the electoral roll at your current address can add 50 points to your Experian credit score, which in turn could help you save on your car insurance premiums. 

Add your parents

Adding responsible named drivers to your policy is another way to slash the price you pay. This is especially useful for younger drivers who can make dramatic savings by adding their parents to their car insurance. 

Regardless of your age, adding a responsible driver with a clean driving record and a long run of no claims could reduce your level of risk in the eyes of the insurer. 

In fact, a recent study reveals that young drivers can save up to £426 by adding their parents as named drivers. 

However, it’s important to remember that the named drivers must only use the car ‘occasionally’ or you run the risk of invalidating your policy.

Reassess your mileage

Thanks to lockdown and increased working from home, it’s definitely worth recalculating your mileage based on your current mileage.

Some insurers wavered cancellation or amendment fees during the national lockdown, so it’s also worth checking with your provider if you can amend your policy. If you have a record of your mileage from the last time you applied for cover, you could use this to calculate the difference used this year.

Invest in new technology

Many car insurance companies are encouraging drivers to use safer cars by offering substantial discounts to those who are already using safer vehicles or are willing to install safety devices. 

Features such as adaptive cruise control, automatic emergency braking and blind spot warning systems, could all save you a substantial amount of money, or if you do have these already installed – make sure you tell your provider.

If you don’t have these installed in your vehicle, fitting a dashcam could also help you save money. 

Insurance providers who offer discounts to drivers with dashcams usually shave between 10 per cent and 12.5 per cent off the price of policies, though it can be up to 20 per cent for young drivers who have the safety device installed. 

Anti-theft devices, such as GPS trackers and mechanical immobilisers such as tyre and steering locks can also help reduce the costs.