If you run a car, you have to insure it. It is illegal to drive without insurance. But the price can add a lot to the cost of motoring, so it is worth knowing the factors that affect the premium you are quoted.
How can I cut my bill?
Shop around and compare quotes from different insurers. Do the Pass Plus scheme.
Where do I go for quotes?
There are loads of companies eager for your business. Internet quotes are often cheaper
What will they want to know?
The starting point is the type of car you want to insure. There are 20 different insurance groups, with price, performance, safety factors, security and the cost of replacement parts being the main factors that dictate the category your car falls into. Smaller less powerful cars are often cheaper to insure.
They will then want to know details about you and any other drivers
What's the difference between "Fully Comprehensive" and "3rd Party, Fire & Theft"?
The main difference is that Fully Comprehensive insurance covers you for damage to your own vehicle in an accident whether it was caused by you or not. 3rd Party insurance covers you for damage to other people, their property or vehicle in an accident where you are at fault but not for damage to your own vehicle.
So which is best? It all depends on your circumstances. If you have an expensive car, it is certainly worth having Fully Comprehensive. However, it will cost considerably more. If you have a relatively cheap car it is probably not worth the extra cost of Fully Comprehensive cover.
What else counts?
Your age, sex and address are the other primary factors that affect the price you are quoted. Young male drivers generally get charged the most, while women in their 50s pay the least. And you will usually pay more if you live in a city than in a rural area. Parking your car on the street overnight, rather than in a garage, will also mean higher premiums.
Will my job make a difference?
It could do. Some insurers might class you as higher risk if you are a sports professional, entertainer, barman, chef or builder, among other occupations. But you may be able to avoid having your premium loaded by shopping around.
How does the no claims bonus work?
You typically get a 30% discount after one year of claim-free driving. This will rise to 65% after four or five years without a claim. But companies vary. Some go up to a 70% maximum, while others specialising in younger drivers will give higher no claims bonuses at an earlier stage. If you move insurers you will need to provide evidence of how many years of no claims bonus you have accumulated with your previous insurer.
Will I automatically lose my no claims bonus if I make a claim?
No. It depends whether the claim is a 'Fault' or 'Not fault' claim. This is not just a question of whether or not you were to blame for the accident, but depends on whether your insurer can recover all its costs from someone else.
Where another driver is involved, unless it can be proved beyond doubt that the other driver was to blame, the two insurers will often settle a claim on a 50:50 or 80:20 basis. Which means that both drivers will lose some of their no claims bonus. With most insurance companies you will lose two years no claims bonus if you have a Fault claim.
Many insurers now offer the opportunity to pay a bit more to protect your no claims bonus. The rules vary, but you may be able to make two claims in three years, for example, before your bonus is affected.
Protecting your bonus will not stop your insurer from hiking up the premium at renewal following a claim. But at least you won't lose your no claims bonus on top.
What can I do to keep my insurance costs down?
Restrict insurance cover to one or two named drivers, rather than insuring it for anyone to drive. Take a bigger excess than the standard £50 or £100. Downsize to a smaller car. Get extra driving qualifications. Consider buying third party, fire and theft cover rather than comprehensive, especially if you have a relatively old car. But most of all, shop around for cover.