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The ultimate guide to lowering your motor insurance premiums

Whether you drive a car, motorbike or tractor, it is mandatory to purchase insurance.

The cost of your motor insurance is dependent on dozens of factors and will be slightly different depending on what insurer you do business with. 

As a general rule, it tends to cost more to insure an expensive vehicle. It also can cost more if you've not been driving for very long - for example if you're under 25 years old.

However, there's plenty you can do to lower your annual motor insurance premiums.

Proving you're a good driver

Insurers calculate their premiums based on the perceived risk of a customer making a claim. With this in mind, it's key to be able to prove to them that you're a safe driver.

A clean licence will help to do that, so avoid picking up careless points for speeding or using a mobile device at the wheel. All driving convictions picked up within five years of a policy starting will be considered when calculating premium costs. A speeding conviction can typically boost premiums by five per cent and more than one tends to increase it by 20 per cent. Motorists could expect the cost of their insurance to double if caught using their phone at the wheel. Those found guilty of more serious offences, such as driving without valid insurance or driving under the influence of drugs, should not be surprised if some insurers refuse to cover them outright.

The amount of years that a motorist has been driving without claiming on their insurance is a major factor affecting the cost of premiums. They can expect discounts of up to 90 per cent if they go more than nine years without claiming, which is why some will pay to fix minor prangs themselves.

It is generally considered to be worth paying to add protection to your no claims bonus. This prevents against the risk of having to build it up from scratch if you do need to make a claim.  

Preventing theft and damage

Those who make an extra effort to prevent their car from being stolen or vandalised are usually rewarded in the form of lower insurance premiums.

Parking your car on a drive instead of in the road helps. Parking it in a garage is even better. Fitting a security device like an immobiliser or a thatcham approved tracking device should also reduce your premiums. An immobiliser prevents a car being driven away without the key, whilst a Tracker significantly increases the chances of locating and recovering any vehicles which are stolen. Both reduce the likelihood of having to replace a stolen car. The use of telematics, which allows insurers to monitor a customer's driving, is becoming an increasingly popular method of driving down insurance costs too.

It has become illegal to for insurers to charge customers more based solely on their gender, but they still use other demographical information such as your postcode and occupation to calculate the risk of a claim being made. That means living in an area with a low crime rate can be beneficial.

Working unsociable hours, with well-known people or expensive equipment can lead to premiums being bumped up. DJs, croupiers, diplomatic staff and professional athletes are amongst those who are punished the most for their choice of work.

Other factors

It's worth considering whether any named drivers on your policy are making it more expensive. Young drivers or those with convictions normally do. The size of the policy's excess can also affect premium prices. Perhaps consider adding a voluntary excess to help your premium drop.

The importance of shopping around cannot be over-estimated when buying motor insurance. Car insurers rarely reward loyalty. In fact, motorists can nearly always save money by switching insurer every year. In an age where insurance comparison sites have huge marketing budgets, it really is surprising that some motorists still choose to remain with the same insurer without shopping around.

Finally, it's important to be completely honest when applying for car insurance. It can invalidate your policy if an insurer finds out you've bent the truth about even the most trivial detail during an application and they often do some pretty extensive checks before processing a claim. 

Related articles:
The ultimate new car security checklist
Insurance telematics explained



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