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Slash the cost of your car insurance with these seven secret industry tricks

12 September 2016

Gocompare.com issues the definitive insider guide to saving money on your car insurance

With new car registrations soon rolling off forecourts and renewal season in full swing, Gocompare.com Car Insurance is pulling back the curtain to unveil the seven easy ways customers can cut the cost of their cover.

Buy in advance

Some insurers may view people who purchase insurance further in advance as more risk averse and therefore less likely to take chance behind the wheel or miss payments. This means that purchasing your cover ahead of time and not leaving it until the last minute can cut the cost significantly.

*Based on a 35 year old accountant, living in South London and driving a 2013 1.6L BMW 1 Series. Difference calculated by comparing the average of the top 10 cheapest premiums returned.

Potential saving: £103

Be accurate with your mileage

The Proclaimers may have been willing to walk a thousand miles, but if they only actually walked a hundred, then they should tell their insurer. It’s common for people to overestimate their mileage, and by doing so they’re potentially paying over the odds.

Your latest MOT certificate should contain your accurate annual mileage and barring any additional journeys you’ll know you’ll need to make, should give you a good indication of what you’ll cover over the following 12 months.

Overestimating your mileage can have an impact on your premium. On average, the difference between driving 10,000 miles and 9,000 miles a year can be as much as £36, dependent on your circumstances*.

*Based on a 25 year old shop assistant living in Birmingham and driving a 1.4L Volkswagen Golf

Potential saving: £36

Clash of the titles

Your occupation is one of the key considerations insurers use to calculate the cost of your premium. While it’s incredibly important to be accurate and honest with your insurer about what you do for a living, when an insurer asks for your occupation, you will usually have to select one of the pre-defined titles they have on their system. This means for some people, there may be more than one job title that accurately describes what they do.

For instance, if you work in education there may be a range of titles that describe your job, like ‘teacher’ or ‘music teacher', but Gocompare.com Car Insurance found a difference in car insurance costs of around £35.43 between the two titles.

Other occupations where this is common include journalism, office work, healthcare, construction and catering.

It's also worth noting that if you're retired or a homemaker, you should select those options and not just say that you're unemployed or out of work. Typically unemployed drivers face higher insurance costs than homemakers or retirees, so be sure to check that you're not paying more than you should be. The difference between being housewife/husband and unemployed was £139.69**.

*Based on a 30 year old driver in Bristol, driving a 1.4L 2013 Vauxhall Corsa. Average of top ten cheapest quotes returned with the only difference being driver’s occupation.

**Based on a 40 year old driver living in Bristol and driving a 1.4 L 2013 Vauxhall Corsa. Difference calculated by comparing the average of the top ten cheapest quotes returned, with the only changing factor being employment status.

Potential saving: £139.69

Save £345 with a named driver

Fronting, which is when a more experienced driver (usually a parent) claims to be the main driver of a younger motorist’s vehicle to get cheaper insurance premiums is illegal and a form of insurance fraud. However, adding another person like a spouse or parent who will be driving the car to your policy as a named driver could reduce insurance premiums significantly.

*Based on a 17 year old student living at home in Cardiff and driving a 1L Corsa, 2008. Difference calculated by the average of the top five cheapest premiums returned vs the top five cheapest premiums returned when a 50 year old accountant was added to the policy as a named driver.

Go fully comp

A common misconception is that third party only is cheaper than comprehensive cover, but in many cases this isn’t true.

In fact in some circumstances, fully comprehensive cover could even be cheaper than a third party only policy. This is because, some insurers may view those looking for comprehensive cover as caring more about their vehicle and therefore more likely to be careful on the roads.

Cover type                           

Annual premium*

Fully comprehensive

£641.57

Third party only

£846.53

Difference

£204.96



*Based on a 28 year old journalist living in South London and driving a 2013 1.2ltr Volkswagen Polo.

Potential saving: £204.96

Pay annually

In most cases, paying for your insurance in one annual instalment is often cheaper than opting for monthly payments. This is because insurers typically charge interest to spread your costs monthly.

While the majority of people may not be able to pay for their insurance in one go, there are alternative ways to spread the cost, without facing additional charges.

Using a credit card with a 0% interest free period could allow you to manage your own payments, without paying interest on the balance. With cards offering up to 24 months interest free on purchases, in one example Gocompare.com Car Insurance found using a credit card to pay for your insurance could work out £113 cheaper than opting for monthly payments from an insurer*.

However, it’s important to remember to pay the balance off before the end of the 0% period otherwise, you will be charged interest on the remainder of the balance on the card.

*Based on a 30 year old accountant in south London driving a 1.6 Litre 2014 BMW 1 Series. Average of top ten cheapest quotes returned when paying an annual premium = £452.21. Average of top ten cheapest quotes returned when paying in annual instalments = £565.31 a difference of £113.10  (rounded above)

Potential saving: £113

Shop around

Most people will already know that in most cases, the best deals go to new customers, and car insurance is no exception. Regularly shopping around is the best way to save big money on the cost of your renewal.

Comparison sites, like Gocompare.com Car Insurance, allow you to compare premiums from over a hundred insurance brands at once, and display the key features of each policy to help you make an informed choice.

Independent research found that customers could save £255.75* on average by shopping around with Gocompare.com, meaning it can really pay to spend a few minutes online.

*Based on Online independent research by Consumer Intelligence during 01 July 2016 to 31 July 2016, 51% of customers could save up to £255.75 with Gocompare.com Car Insurance

Potential saving: £255.75

Matt Oliver, car insurance spokesperson at Gocompare.com added; “Naturally, not everyone will be able to save this much off the cost of their cover, but these industry tips should help bring the cost of insurance down for most motorists.

“While most of these tricks can helps shave some pounds of your premium, the big money is in switching and regularly shopping around. So, whether you’re buying a new car, or your premium is up for renewal never just accept the first offer you’re given, especially if your circumstances have changed. Take the time to get online and find the right policy for you at the best possible price.”

See Gocompare.com's guide to find out how to save more money off the cost of car insurance.

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