Tuesday 12 November 2019

12 things you need to do to help reduce your bills for car insurance

The Irish Independent's Personal Finance Editor, Charlie Weston, has the top tips to help save you money

Car insurance - take steps to reduce your costs
Car insurance - take steps to reduce your costs

The search for good-value motor insurance is an ongoing battle for car owners.

Insurance companies have increased premiums in the past few years and are now hoping we will come to accept the elevated costs.

Official figures indicate that premiums costs are falling slightly - but that is after three years of relentless increases.

However, that is not the experience of many drivers.

Many of them are getting renewal quotations that are higher than they paid last year.

And that brings me to the first important point to take note of: a renewal quote is often a try-on. Remember that.

Insurers know that a good proportion of drivers will not quibble (hard and all as that is to believe) with the expensive renewal quote and that they will just go ahead and pay it.

No. You should always challenge the renewal quote and go to a good broker to get better value.

One good tip in that regard is to seek quotes giving details of your driving record, car and claims history - but do not reveal what you are currently paying for insurance.

By doing this, you might be surprised to find yourself ending up with a lower quote than the premium you paid last year.

This situation leads some to conclude that insurers pull renewal quotation figures out of the air.

So here are a number of ways to fight back against premium rate rises and save yourself a considerable amount of money in the process:

1. Switch

If you are claims-free, it makes sense to regularly switch insurer.

Compare rates from different insurance companies by ringing them or going online. It is worthwhile using a broker.

It won't cost you any more than going directly to the insurer as the broker is paid by the company.

You may be entitled to a discount if you have more than one type of insurance policy with the same company.

Also ask if there are other discounts you might be able to get.

2. Consider the security systems

A car with an alarm will be cheaper to insure than one without, for example.

3. Don't over insure

Other tips to keep the costs down include being conservative with the car's value.

This is important as you can only claim what the vehicle is deemed to be worth by the insurance company's assessor.

People often overvalue their car. Check motor sales adverts to get a good market indicator of your motor's value.

Alternatively, the Revenue Commissioners website (www.revenue.ie) has a valuation tool for each model and year of manufacture, put in place for vehicle registration tax purposes.

4. Check the excess

Be careful about the excess. This is the amount you have to pay before you can make a claim. Lately, insurers are imposing higher and higher excesses. This reduces the risks for them, but means you end up not claiming for small accidents.

Excesses of €500 are not uncommon these days, but when they get to that level, they rather negate the value of having insurance in the first place - though of course it is a legal requirement to have cover.

5. Get a discount by using telematics

Telematics is a way of monitoring the location, movements, status and behaviour of a vehicle. You can do it with a smartphone. Insurer AIG offers discounts of up to 20pc on motor cover for using an app that monitors driving style.

AIG says it aims to reward better driving behaviour with potential savings of up to 25pc on car insurance premiums.

Customers who use the app will be given a 20pc discount on their premium immediately and further discounts of up to 5pc will be applied to the premium after three months' use, subject to the scores achieved.

6. Men: get insured with Its4women

Online insurer Its4women markets its motor insurance at women, but the law means it cannot refuse to cover men.

Because most of its customers are women - who are safer drivers and also have fewer claims - it tends to be more competitive than motor cover sold equally to both sexes.

A recent European Union gender directive, which became law in this country, means that men and women can't be discriminated against in terms of the price of insurance. Dublin student Shane Spain was able to reduce the cost of his cover from €810 to €500 by opting for Its4women.

7. Don't modify

Avoid modifying your car, unless you are increasing its safety. Even a small modification, such as new alloys, can cause your premiums to shoot up. Any changes should be discussed with your insurer first. However, any modification that increases safety, such as installing an alarm or immobiliser, can help you cut costs.

8. Small engine

Choose your car wisely. The more expensive your car and the bigger its engine, the more you are likely to pay. You may also have to pay more if your car is imported or if there are more theft claims on your model of car.

Check with your insurer before you buy a car, so you can estimate insurance costs.

9. Pay annually

Pay for your cover annually if you can afford to do this. Paying for cover monthly is the same as taking a high-interest loan from your provider, with interest as high as 20pc imposed on top of the premium for paying by instalments.

10. Park in a garage

If your vehicle is secure when you are not using it - in a garage - it is less likely to be stolen or hit by other cars.

Tell your insurer if you park in a garage and see if you can get a price break as a result.

11. Add another driver

Many motorists are unaware they could bag themselves a further discount by adding a spouse or a partner to their policy, according to AA Ireland.

Some insurance providers offer a discount of up to 20pc just for adding your spouse or partner, so it is certainly worth inquiring.

12. Keep a clean licence

Penalty points or convictions will increase the cost of your car insurance.

If you are sensible and drive safely it should pay dividends in terms of a lower premium.

Indo Motoring

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