15 DOs & DON’Ts of Car Insurance

1 – DON’T forget to check the validity of your photocard

When the old paper license was replaced by the photocard license in 1998, a new rule came into place which stated that you were obliged to get your photo renewed every 10 years.

DVLA figures from 2011 state that at the time there were 1.7 million photocard licenses with outdated photographs on them, and the number has grown since. In November 2017, that number was listed at almost 3.4 million.

You have an obligation to keep your photocard license up to date – are you one of the growing millions who might have an issue with their insurance?

2 – DO install security, drive and park carefully

Your insurance quote is heavily affected by factors which put the car (and the insurance company) at risk. Accidental damage and theft add a huge amount to insurance premiums and anything you do to reduce those risks helps considerably.

Fitting an immobiliser or alarm to your car will reduce your insurance bill as it deters both theft and vandalism. Similarly, leaving your car overnight on a driveway or in a garage indicates a lower chance of both theft and accidental damage.

Speeding penalties stick to your license like glue, sometimes affecting your premiums for 4 or 5 years – and the higher the number of points on your license, the higher your overall car insurance costs.

Being caught on your mobile phone while driving is more serious and incurs a significant penalty. It can as much as double your quote! Put your phone aside, and if you have to use it, make sure it is with a properly fitted hands-free kit (but be careful with this, as the police can still pull you over if they feel this is distracting you and affecting your driving).

3 – DON’T presume third party is cheapest

There are three categories of car insurance:

  • Third party (covering only other people you affect if at fault in an accident).
  • Third party, fire and theft (as third party, plus covering your own vehicle if it is stolen or damaged by fire).
  • Fully comprehensive (covering all of the above, plus your own damage and costs).

It stands to reason that third party insurance must be cheaper than the others – after all, it covers less. Astonishingly though, this is not always the case. Always make sure you obtain a quote for all three types of insurance and compare them – you might be pleasantly surprised to see that fully comprehensive is cheaper than the third party quote.

The reason for this is because it is assumed that third party buyers are, on average, a higher risk group because they don’t care about their own cars – and this increases risk and thus, the premiums. If you are a low-risk driver then the quote for third party cover can often be considerably higher than the fully comprehensive alternative.

While there’s no hard rule, it is definitely worth checking all options.

4 – DO add a second responsible driver

When you add a second driver to your policy, you level out the overall risk and this can help lower the policy premiums. Of course, this only works if the second driver is considered a lower risk than you are, and doesn’t help if you add someone too young or too inexperienced.

5 – DON’T add yourself as the main driver on someone else’s car

It is sometimes tempting to put yourself as the main driver on a car which is driven by someone else in your family – like one of your young adult children. The idea being that the insurance on that car will be lower if a respected driver, rather than a new untested one, is the main insurer.

This is serious fraud, known as ‘fronting’ and carries significant penalties, not the least of which is having your insurance cancelled. It can lead to prosecution.

The main driver on the car’s insurance should always be the person who drives the car the most. There is nothing wrong with being listed as an additional driver, as explained in tip 4.

6 – DO try altering your job description

As crazy as it sounds, a minor change to your job description can save you cash on your insurance. Insurers use overall history as a statistic for calculating risk, so if many people with the same profession as you have had more accidents, it can directly affect your claim!

Try tweaking your job title to see if you get a better quote with a slightly different (yet still honest) description of your work.

7 – DON’T overrate your mileage

The less you drive, the less you are on the road and able to be involved in an accident, and thus the cheaper your insurance will be. If you can bring down your yearly mileage by cutting down on unnecessary journeys, you could save considerably on your insurance.

Try to evaluate your mileage accurately. With tools like Google Maps able to tell you exact mileage for journeys, a realistic estimate is possible with a little time spent researching.

Additionally, when debating whether it is cheaper to take a journey on public transport rather than use the car, take the additional hit to your insurance into account, as well as the more obvious fuel costs, parking, and car wear and tear.

8 – DO separate business use from personal use

If you use your car for business use, be sure to inform the insurance company accordingly. It can help to keep records of your mileage for insurance as well as expenses purposes.

You run the risk of having your insurance annulled if you are using it for business without properly declaring the fact.

9 – DON’T forget that car type affects insurance cost

The engine size, popularity and value of your car can all impact the insurance – bigger, flashier cars cost more to insure. Consider this when choosing your vehicle.

10 – DO inform insurers regarding special circumstances and changes

If there is anything unusual about your car or your circumstances, make sure you tell your insurer about those when you are buying your insurance.

If you have made a claim, your car is modified, or you drove over 100,000 miles in the previous year, then your insurance company needs to know. Failing to tell them could result in an important claim being rejected and your policy may become void.

Remember to tell them about any changes in address or marital status (people in stable relationships are often a lower risk), plus inform them if your job changes or you become unemployed.

Failure to have the correct details at the time of a claim can cause problems, and once you have had a policy terminated due to a fraudulent claim it is incredibly difficult to find another one at a reasonable price.

11 – DON’T modify your car

Apart from helpful things such as adding an alarm, car modifications will undoubtedly increase your insurance.

Always tell your insurer about any modifications on your car – whether or not you were the person who made them.

12 – DO calculate how much you want to claim for

Sometimes it is simply not worth making a claim – the knock-on effect to your insurance for claiming for low value incidents is simply more costly than the value of the claim. With this in mind, setting an excess amount above the amount you would naturally foot yourself makes sense.

The higher your excess, the cheaper the premiums. If you do not intend to claim for anything under £500, then make sure your excess is set there. Policies become substantially cheaper with an excess of £1000 – ask yourself if you are willing to move the risk from the insurer to yourself to that sum, and maybe select it for a quote to see the difference yourself.

There is a disadvantage of course beyond simply sorting smaller claims yourself – and that is that you will be liable for the excess amount in a larger claim too.

13 – DON’T lie

Lying on your insurance is fraud and will never help you in the long run. It is imperative that the insurance company makes their assessment based on the real facts and not on anything fabricated to falsely improve the premium.

If you are found to lie on your insurance, the consequences could be disastrous and could lead to criminal prosecution.

14 – DO try to protect your no-claims bonus

For every year that you do not claim, you receive a discount. The no-claims bonus system is designed to put people off making a claim – and it works.

There are some policies which offer a ‘protected no-claims bonus’, meaning that even if you make a claim, you get to keep your bonus going into the next year’s insurance. While this is an additional cost on the premium, it could save hundreds of pounds should you have an accident.

Remember though, that even if you keep your no-claims bonus, any accidents you have had (even ones not your fault) may be considered an increase in risk and affect future insurance policies.

15 – DON’T take the first quote

Car insurance is a big industry. You are legally required to have it, which means you must end up buying it from someone, but the choice of your insurer is yours.

Find an insurance company that offers you a good deal, by taking the time to get quotes from multiple places – whether that is direct with the insurer, from a comparison site, or by speaking with an insurance broker.

Once you get a quote, remember you can discuss it with the company and see if you can negotiate a better price – especially if you have another quote from a competing insurer that you can use as a bargaining chip.

Remember though that there are other factors to help determine the best company for you beyond simply the cheapest quote. Make sure you are happy with the service you are offered and always read the small print.

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