How to Save Money on Car Insurance

Sometimes it may seem as though the increase in vehicle insurance costs is running faster than you can drive your car. The risks of accidents on our highways are increasing and car insurers have to raise premiums to cover for these risks.

One of the reasons for the increase in risk is a slight change in demographic patterns. It used to be that drivers from ages 18 to 25 were thought to have higher likelihood of getting into accidents. The picture has changed a bit, as economic advancement has permeated a bigger proportion of the population. Today, there are older drivers with less experience plying our roads. That adds to the risk, and thus to premiums.

What can you do in the face of these rising car insurance costs? If you look at how car insurers determine their insurance premiums, you can develop ideas about how to save money on car insurance.

Here are some tips:

Keep driving safely. Some insurers reward you with a discount on your premium for every year that you do not make a claim against your vehicle insurance. You can ask for that discount from your current insurance provider and if they don’t oblige, you’ll probably be able to get a better rate from another insurance company.

Nominate the drivers included in the policy. Insurance companies get a better estimate on their risk if there are less people authorised to drive your car. The result is a lower premium for you. If you do this, make sure that only the designated drivers use the car: if an unauthorised driver not named on your policy gets your car involved in an accident, your claim will be rejected.

Increase the amount of your voluntary excess. Excess, or the first amount payable, is a certain portion of any claim that is not included in the insurance cover. The higher the amount you are willing to absorb on voluntary excess, the lower your insurance premium. In effect, you are betting that you won’t find the need to claim during the year. Be sure to set an amount that you can afford in case you do need to make a claim.

Compare prices. Obtain as many insurance quotes as you can or at the very least, a minimum of three quotes. Make a point of comparing these feature by feature. Some policies may be cheaper than others because they have more excluded items or even because they provide limited coverage.

Choose a low-risk car. The type of vehicle affects the premium. Expensive or sporty cars face a higher risk of being stolen or getting involved in a crash. They are also more costly to repair and have more expensive parts. Some lower budget, popular cars on the other hand may be good targets because of their midnight spares value. Researching before buying is always a good idea.

Park safely. Parking your car in a locked garage or behind locked gates overnight reduces the risk of theft. Insurers can give a discount for this.

Install security measures. Install quantum microdots, a tracking device, gear-lock, and other anti-hijack or anti-theft devices in the car. You can get a discount if the insurer finds out your car has more security devices than the standard requirement.

Buy a no-frills policy. There could be some features in a policy that you may not really need. Remember, the more features (i.e. risk) covered by a policy, the higher the premium.

Negotiate. It may sound superfluous, but many car owners are shy about negotiating their premium. If you feel that you are entitled to a bigger discount (like having a clean driving record or having multiple security devices installed), go ahead and ask for it. Insurers know that there is precious little brand loyalty in the car insurance industry. If they want your business badly enough, they will find a way to accommodate a reasonable request.