Tips for reducing your car insurance premium

It’s obvious that the less chance your car has of getting stolen or damaged, the lower your car insurance quote should be. That means systems like an immobiliser, an alarm, an in-car tracker and steering and parking locks are all useful in driving down your insurance costs.

On a larger scale your postcode and area where you live will reduce insurance costs but it’s not logical to move house to save money on your car. However it could come into the reckoning when moving house.

More within your remit is where you park your car. A well lit street, drive or garage is a lot better than say an alleyway at the bottom of your road.

When applying for car insurance you will be asked when and what you will be using your car for. Again the system is fairly logical, the more you use your car and the times you use it, the more expensive it will be to insure. That means people who use their personal car to commute will have to declare it and inevitably pay more than if their car was for social use alone.

It is worth weighing up the advantages of public transport with your insurance in mind.

There’s a reason the majority of new car drivers use superminis and hatchbacks – they’re usually easier to drive, more familiar and a damn sight cheaper to insure. That’s generally because there’s less power under their bonnets – try and find a 3.0-litre Ford Fiesta.

Power and size obviously affects insurance and the smaller the car in terms of size and power, the cheaper it should be to insure.

The more points on your licence, the more of a risk you are potentially and the more your insurance policy will cost.

No claims bonus (NCB) is a system that allows you to claim a discount on your next insurance policy – essentially it’s a reward for driving safely and not claiming on your insurance.

It’s a simple system and the more years no claims you have, the cheaper your insurance policy will be.

Unfortunately the only way you can achieve NCB is by being the lead name on your insurance policy as opposed to the popular method of being a named driver on somebody else’s policy.

That means your first insurance policy will always be expensive, regardless of age and the sooner NCB can be built up, the sooner you will reap the financial benefits.

There are a number of different types of insurance policy and the cheapest is third party.

Third party insurance will not give you as much cover and security as a comprehensive policy however if your car is old or inexpensive it could be the best policy for you.

Another method is to increase the voluntary excess. This will reduce your premium but it will increase the amount you will have to pay if you make a claim.

It’s important to work out which form of cover best suits you rather than simply going for the cheapest terms available.

Insurance can be paid for in a number of ways whether monthly, quarterly or in one lump sum.

While it may feel like you’re saving money by paying monthly, lots of insurers charge more for instalment payments and tend to offer discounted prices for those able to pay in one go.

There are a number of tests open to drivers who have already passed their test including Pass Plus – a test that familiarises drivers with motorway driving – and other tests offered by different driving groups.

These will show a certain level of competency and could work towards lowering your insurance costs.