Saving money on your car insurance
According to comparethemarket, car insurance premiums are at an all-time high, the average policy is set to cost us a whopping £800 as of last year, 14% up on 2015. A common reason given for the rising cost of insurance is the amount of claims made by road users (which keeps going up! 2.2.% increase in road users as of 2016). With whiplash being one of the most common reasons to claim, the government has pledged reforms to the law that is supposed to save us all £40 a year. Great right? Except insurance premiums are still set to rise, despite the changes!
The whiplash reforms have been explained simply by UK solicitors Your Legal Friend here. As they point out, the premiums are still set to rise because of increases to the insurance premium tax. So whatever way we look at it, driving is getting more and more expensive. There are still some ways you can save though and not get caught out by costly premiums.
Pay up front
It’s expensive to pay your car insurance in one go for the year, but the savings are significant if you can do it. According to moneysupermarket, some insurers add on 10% to the quoted premium for monthly payments. Some people, if they have good credit, choose to get a 0% credit card and pay their insurance upfront with that, and then slowly pay it off monthly without incurring any interest.
Choose a car with a smaller engine
Smaller cars tend to come with lower insurance, and sometimes, little to no road tax. Look for cars less than 1.6L engine for savings. If these cars are newer, they’re also less likely to see you lumped with a costly insurance bill.
Hold onto that no claims bonus
It sounds like ridiculous advice but driving carefully and holding onto your no claims bonus is really one of the most important things you can do. You can’t control the actions of other road users but you can be sure not to be at fault if you are careful. If you are in an accident, don’t admit liability at the scene. You may not have been at fault but if you admit liability, you may lose your no claims bonus.
Pass Plus Schemes
Pass plus schemes are a continuation of your driving lessons, taking you through conditions you may not have encountered like driving on a motorway, or driving at night, with the safety net of your instructor there to help you through it. Doing a pass plus scheme can knock pounds off your insurance costs.
Accept the higher excess
It’s a difficult trade off, since you are trying to save money, but agreeing to pay a higher excess in the event of an accident can save you upfront insurance costs. Some people never claim on their insurance and therefore think the risk of having to pay the excess is justified. Only agree to pay what you can afford and try to save money back just in case you ever are in an accident.