Helping you understand different kinds car insurance and how to lower your car insurance prices.
As if having a car wasn’t expensive enough, but once you think about the word insurance, the price in your head suddenly triples. Insurance is a must when running your car, it’s park of UK law to make sure your car is insured. Car insurance exists to protect you from careless drivers, and make sure your car is repaired without a massive pay out by you or chasing someone up who damaged your car, demanding payment. Insurance is a costly thing, so it’s important to understand the ins and outs of it all. Outlining everything to do with car insurance, this guide will also help you find out how to get the best deal. With advice on how to get low car insurance rates.
Types of Insurance
If you didn’t know before, there are three kinds of car insurance available. But, insurance on your car is a legal requirement. Since 2011, car insurance has been part of UK law, in an attempt to cut down on uninsured drivers on the roads. Here are the three options available:
Third Party Car Insurance – The minimum requirement, by law, third party covers you against damaging property or injuring someone. This does not cover you for any repairs needed for your vehicle.
Third Party Fire and Theft Car Insurance – Including the cover listed above, you are also covered against car fire and if your car is stolen.
Fully Comprehensive Car Insurance – The most expensive option of them all, fully comprehensive cover protects you against everything listed above, as well as loss of personal belongings from inside your vehicle (phones, sat navs etc.), European cover, audio equipment, windscreen repair, personal injury and a courtesy car too. Not all providers offer all these features, so it’s important to enquire about what you’re getting. You may also be insured to drive another person car, with their permission.
These types of insurance range from lowest to highest, but in some cases, full comprehensive cover can be cheaper. Things like black boxes and multi car covers affect insurance prices too. But, how much is car insurance? Well, there are other factors that determine the price of your car insurance, including:
- Gender and Age
- Marital Status
- Where you live
- Credit Score
- Vehicle Age, Size & Safety Rating
- Likelihood of Theft
- Driving History & Activity
Typically, young men under the age of 25 will pay more on their insurance, and a bad credit score can massively impact your rates as well. Married people, especially men, get better rates on car insurance as well as office workers – if you’re on the road a lot for work, your insurance rates are normally higher. If you’ve got a flashy car, your rates are likely to go up as well.
Whilst you can’t change your age or where you’re from, there are ways to improve the rates and quotes you receive for car insurance.
Ways to Lower your Car Insurance Rates
Improve your Driving – Driving safe is one of the key ways to lower your interest rates. Drivers that have had a good track record get fairer rates on car insurance. Car insurance brokers will also analyse your driving activity, factoring in how far you drive, what you use your car for, when and where you drive. If you can avoid using your car for long distances/ at night, you could see your rates lower. Some companies offer driving trackers, to monitor your driving for a couple of weeks before giving you a quote. If you can show insurers you drive safely you could save.
Improve your Credit – If you credit score is less than desirable, it will affect your rates on car insurance. In order to get low car insurance rates, there are a few things you can do to improve your credit score. Paying off loans and bills can help your credit score. Guarantor loans are ideal loans for people with bad credit. Not only can they slowly improve your credit score over the repayment of the loan, but they have much fairer rates than credit cards or other loans that are available for those with poor credit. Paying off debt and bills helps build a good credit score, meaning you could save money on car insurance by taking a few simple steps.
Improve your Car – We’re not talking ‘pimp my ride’ but if you opt to go for a larger vehicle, you could save on your insurance. Bigger cars have better safety ratings therefore making them safer in an accident – which insurers like to protect against. If your car is safer your rates could be lower. The price of your car factors in too, an Audi is more likely to get stolen than a KA, because they cost more. Insurers won’t offer you a lower rate on a more expensive vehicle, so if you want to save money on insurance, consider downgrading slightly. A bigger car with a lower cost means lower rates.
With anything in life, it’s always good to get a second or third opinion – especially when it comes to quotes. Online services like Compare the Market, will compare thousands of different quotes on insurance, loans and other things. So, when looking around for a quote, it’s important to always compare other rates available. Shopping around and investing a little time could mean you save yourself a bit of money. You’ll be able to put in your details, and comparison sites will run your criteria through a search, and come up with all the offers available to you from insurance companies.
Reducing your rates on car insurance takes some work, but the pay off is greater in the long run. By lowering the cost of your insurance, you’ll save money in the long run.
Robert Smoker, the CEO of TFS Loans, has an extensive work history within the finance sector. Having worked with a prestigious Private UK bank for over 36 years, Robert has had many head and executive financial roles under his belt since the late 70s. His extensive knowledge of the financial and loans sector carries into his writing, creating content for financial blogs and more.