How to get cheaper car insurance

For any motorist to drive legally in the UK, they are required to have valid car insurance. With costs of living rising in 2022, now more than ever, people are asking the question; how can I bring down the cost of my car insurance?

In this dedicated article about car insurance, here at Octane Finance, we share our wealth of motor industry knowledge to help bring down the price of your overall annual motoring costs. We explain the importance of having your vehicle insured, share our top tips on how to get cheaper car insurance, and highlight how new or young drivers can keep car insurance costs down. Read on to find out more… 

Why is car insurance important?

It’s a legal requirement in the UK to have car insurance in place if you own a road-worthy vehicle. If you were to have an accident, your car insurance policy is there to protect you. A car insurance policy can cover you as the driver, any passengers you may be carrying at the time, plus the costs of any damage that your vehicle may have incurred. 

If you were to have an accident and it wasn’t your fault, you’ll want to have the peace of mind knowing that the repair bills will be covered. If you are involved in a collision by your own doing, car insurance is there to cover the costs of repair for not only yourself, but the other party too. 

There are three main types of car insurance available in the UK:

1. Fully comprehensive. This is the most popular form of car insurance for drivers as it offers the widest and most thorough amount of cover should you need it.
2. Third-party, fire and theft. This offers a lesser form of car insurance, but includes cover if your vehicle is damaged by fire or stolen.
3. Third-party only. This is the minimum level of car insurance legally required in the UK. Although it can work out cheaper, third-party car insurance will only cover you for the bare minimum in the event of an accident.       

What is the cheapest way to insure a car?

We can almost hear the sighs from here when you realise it’s time to renew your car insurance. Shopping around for car insurance deals each year can feel like a chore and become a real burden. For this reason, many of us instead allow our current car insurance policy to automatically renew. But, did you know this is just one of the expensive mistakes you could be making when it comes to securing cheaper car insurance?

Allow us to share our top 10 tips and helpful hints to help you keep the cost of car insurance down…

Compare insurance quotes

We would all rather choose the easy option when it comes to car insurance renewal, but don’t be tempted to stick with your current provider. Instead, take the time to shop around for the best deals available to you using comparison websites such as Compare The Market and Go Compare. Websites like these compare hundreds of car insurance providers, so you can check you’re getting the best-priced policy for your needs. You could be left feeling pleasantly surprised at the great deals available to you! 

Reduce your annual mileage

This sounds like a strange one when it comes to accessing cheaper car insurance, but reducing your annual mileage really can make a difference. The less time you spend on the road and in turn, the less miles you do, makes you a lower risk to a car insurance company. However, make sure you are realistic about your mileage when applying for car insurance. If you were to make a claim, you may risk not receiving a payout if your annual mileage was far from accurate.

Pay annually

Although it’s not always ideal from a cash-flow point of view, paying for your car insurance annually, rather than monthly, will save you money. Of course, car insurance providers will always tempt you with an option to pay monthly, but you will end up paying more for your car insurance overall. 

Increase your excess

It’s always tempting to opt for a lower excess cost on your car insurance policy. Should you be involved in an accident, it’s understandable that you won’t want to pay out hundreds of pounds in upfront costs as part of your excess. But, choosing to pay a higher voluntary excess can bring down the cost of your annual premium, so it’s definitely worth considering.

Consider where you park

Where you park your car during the day or at night has a huge bearing on the cost of your annual car insurance premium. In order to achieve cheaper car insurance, providers favour drivers who park their cars on a private drive or in a secure garage. Of course, we appreciate this isn’t always possible, and it’s best to be honest about where you park your car during the day and overnight. 

Consider installing a black box

A black box is a small device (about the size of a mobile phone) that can be installed in your car to monitor your driving style. Using telematics technology, they can be beneficial for the likes of car insurance companies who will offer to reduce your annual premium should you be able to demonstrate that you are a safe driver. 

Avoid penalty points

Whether it’s for a speeding offence, jumping a red traffic light, or being caught using your mobile phone while driving, many motorists in the UK have fallen foul of penalty points on their driving licence. These can actually be a hindrance when it comes to renewing your car insurance, as insurance companies deem you to be more of a risk. Drive safe and avoid penalty points to help keep your annual car insurance premium low.

Build on your no-claims discount

By not making a claim on your car insurance policy each year, you will be rewarded with a no-claims discount (NCD). Over time, your no-claims discount will build and you can also take them with you should you choose to move to a new car insurance company. According to research conducted by comparison website Money Supermarket, drivers with at least five years of no-claims discount were offered an annual car insurance premium up to 60% lower than those without.

Improve your car’s security

Car insurance companies will always favour drivers who can prove their vehicle is fitted with extra security devices. These motorists are usually offered a better annual premium as they are deemed to be in a lower risk group when it comes to making a claim, especially their chances of claiming for a vehicle break-in or theft. 

Consider the add-ons

When renewing your car insurance, companies will always provide you with a list of added extras which they’ll encourage you to take out as part of your policy. From legal cover to breakdown assistance, it may be that if you require these add-ons, it will work out cheaper if you purchase the products separately - always do your research first. 

How to make car insurance cheaper for young or new drivers

Passing your driving test is exciting, but it of course lends itself to costly purchases. Whether you invest in your own car or opt to car-share, you’ll want to know how you can make your car insurance costs as cheap as possible if you’re a young or new driver. Here are our top three tips for achieving cheaper first-time driver insurance:

Choose your car carefully

As a new or young driver, choosing your first car is an exciting prospect, but it’s important to be realistic about what car you purchase can influence the price of your car insurance. For the best annual premium, opt for a car in a lower insurance group, which are cars with small engines - such as a Nissan Micra or Hyundai i10. Consider cars which fall into insurance groups 1 to 3 for the best price annual car insurance.

Add an experienced named driver 

Adding an experienced named driver to your car insurance policy, can help young or new drivers bring down their annual premium. You must be clear on whether the other person is a main driver, or second driver though. 

Install a black box in your car

If you’re a first-time driver and are keen to keep your car insurance costs down, then installing a black box in your vehicle is a great way to do so. In fact, some car insurance companies will half the price of their premium purely based on having a black box telematics device installed.

What happens if I drive an uninsured car?

As we’ve highlighted, car insurance is a legal requirement in the UK, so if you are caught driving without the necessary car insurance, it is a punishable offence by law. As stated on the official UK Government website, it is illegal to drive a vehicle on a road in a public place without the bare minimum third-party insurance in place to cover you as a driver. 

Depending on the circumstances if you are caught, penalties for uninsured drivers include:

• An on-the-spot fine of £300
• Six penalty points on your driving licence
• Your case could go to trial and you’ll be required to appear in court
• An unlimited fine
• Disqualified from driving for a set period of time, or for life
• Your vehicle can be destroyed

As a motorist in the UK, always make sure you have the correct car insurance in place. 

Let us help you with car finance

Here at Octane Finance, we help thousands of customers every year to get approved for new or used car finance. Our dedicated team of motor industry professionals work with you to secure the finance you need to get you on the road. 

We can even help young or new drivers achieve the finance needed to invest in their first set of wheels. From Personal Contract Purchase to Hire Purchase, and Lease Purchase, speak to us about accelerating your car finance application.