Home | Areas Covered | Contact Us | FAQ | Repairs

How To Reduce Your Car Insurance Costs

We all want cheap car insurance but with research from a comparison website revealing that premiums increased by an average of 31 per cent in 2010 alone, is it possible to get an affordable deal?

Here we reveal the steps you can take to keep your car insurance premiums in check.

Step one: Build up a no-claims discount

A no-claims discount is a reward for people that don't make claims on their policy and could be worth as much as 60 per cent off your premiums after four or more years. Importantly, no-claims discounts are 'no claim' and not 'no blame' meaning that if you do make a claim on your insurance your no-claims bonus will be affected unless the insurer can recoup its costs from the other driver's insurance company. Typically for every fault claim you make you will lose two years' worth of bonus although some insurers do offer no-claims discount protection for an additional premium.

As a no-claims bonus can potentially reduce your premiums by such a significant amount its worth avoiding small claims and considering having small repairs carried out without making a claim with your insurer.

For example, Scuff N Chips mobile car body repair service will repair minor collision damage for private and trade work with competitive prices. On average, its car body repairs are around 75 per cent cheaper than those of traditional body shops and garages and your vehicle will not be kept for long periods. Typically repairs are carried out in around two hours at the address of your choice by trained staff with a two-year guarantee. The company is fully mobile but concentrates its operations in Essex, London and Hertfordshire.

The advantage of using Scuff N Chips compared to making a claim with your insurer is that there is no risk that your no-claims discount will be affected - meaning you could continue to enjoy premium savings as high as 60 per cent. In addition, there is no insurance excess to pay.

Step two: Choose your car carefully

Most insurers will pay close attention to the vehicle you drive when assessing your premiums. This includes the car insurance group in which it is categorised by the Association of British Insurers (ABI). The ABI assesses car insurance groups from 1-50 (previously 1-20) with higher groups indicating higher levels of risk and higher premiums. Among the factors assessed are: the vehicle's value; damage and parts costs; repair times; performance; and security levels.

When shopping for a new car you can look at the ABI's database to see the classification of the vehicle you are interested in.

As a general rule of thumb, look for vehicles with lower values because they will cost less to repair/replace. Similarly, older vehicles generally receive lower premiums because the value of the vehicle is lower - although this is not always the case with classic cars. Smaller cars should also be considered because they normally have less powerful engines and are therefore less likely to be driven at high speeds.

Modifications should also be avoided because they will usually add to a vehicle's value.

Step three: Choose the right level of cover

With car insurance, generally the more cover you take out, the better protected you are. However, if you're looking for a cheaper deal then it's worth assessing which policy features you require.

Broadly there are three levels of cover available: third party only; third party, fire and theft; and comprehensive. Comprehensive cover is recommended for most drivers - however, if you have a relatively inexpensive car or premiums for comprehensive cover are too high, then it may be worth taking out third party cover until you build up a no-claims discount.

Similarly, if you do opt for comprehensive cover think about the policy features you need. For example, you may not want to pay for a courtesy car if you already have access to a second vehicle. Also consider how you use the vehicle - if you only use the car for social purposes, for example, don't pay for commuting or business use.

Step four: Lower your risk.

Insurers assess premiums in different ways but will generally consider: your annual mileage; the vehicle you drive; your address; your personal circumstances; and your driving record. Lowering your perceived risk to an insurer can lower your premiums.

For example, you can lower the risk of theft by fitting approved security devices to your vehicle and by parking in a garage overnight. By reducing your annual mileage you are less likely to be involved in an accident; and limiting the number of named drivers on your policy can also be beneficial, particularly if the named drivers are inexperienced or have poor driving records. Also consider paying annually instead of monthly to avoid monthly interest charges.

Also consider agreeing to a higher voluntary excess - this would mean paying more in the event of a claim but should lower your premiums. Remember however, to keep your excess at a level you can comfortably afford.

Step five: Shop around.

When searching for car insurance remember that quotes can differ widely between companies so it makes sense to gather as many quotes as possible. This can be done quickly and easily with a comparison website.

The leading comparison websites compare prices and policy features from around 125 insurers with one search potentially saving you time and money.

How To Reduce Your Car Insurance Costs

Copyright © - 2011 Scuff 'n' Chips, Hertfordshire - Essex - London.......All Rights Reserved