Car insurance: Finding cheap car insurance

Car insurance may be the ultimate grudge purchase but it doesn’t need to leave you out of pocket. 

Follow our top tips to slash the cost of your cover.

1. Use comparison sites to get quick quotes

Price comparison sites are a good place to start as they allow you to get multiple quotes quickly. The sites are not always 100% reliable, though, so make sure you double check the policy you're interested has everything you need when you click through to the website of the provider. Remember, not every provider appears on comparison site

2. Set the right excess

If you're willing to fork out more on your excess – the amount you have to pay yourself in the event of a claim – your insurer will reward you with lower premiums. However, make sure you select your excess carefully.

Setting the bar too high, especially if starts getting too close to your claims limit, might make claiming on your car insurance either pointless or too expensive.

3. Choose your occupation carefully

Insurers look at many factors when calculating the cost of cover including what you do for a living. However, the job categories used can be broad meaning that many drivers could fit into many different segments.

For example, if you work in publishing as a writer and put your occupation as journalist you're likely to pay more than you would if you put down editor, copywriter or even reporter. If you're unemployed, but are a housewife or househusband, putting yourself down as a homemaker instead can help you save money.

However, remember that you should never lie about job. Don’t say you butcher if you’re a baker. This is considered fraud and you could be prosecuted.

4. Avoid modifying your car

Don’t be fooled into thinking that insurers only consider boy racer cars as being modified. Even a small modification to your car, such as new alloys, can cause your premiums to rise. If you're going to make any changes to your car always discuss them with your insurer first.

Conversely, any modification to your vehicle that increases it safety could save you money. Installing an alarm, tracker or immobiliser – especially if approved by car safety research firm Thatcham – can set your car insurance premiums tumbling.

5. Pay for your cover annually (if you can afford to)

Insurers will give you the option to pay for you cover in two ways - on a monthly basis or in annual lump sum. While paying monthly might seem like a sensible way to spread the cost, it can cost £100 more than paying annually.

Paying for cover on a monthly basis involves taking a loan, usually at high interest, from your provider. APR can vary but it can be as high as 40%. Some insurers will also charge you a fee for setting up a monthly payment plan. Kwik Fit, for example, charges £35 for providing you with credit.

Always check pay-monthly fees and the compare the cost against annual cover. It's not always clear on comparison sites what APR you'd pay, so check with the insurer direct before accepting a quote

6. Avoid auto renewal

Insurers reserve the best deals for new customers and often push up the premiums for their loyal policyholders. Rather than just allowing your policy to roll into another year shop around and see if you can find yourself a lower premium. Even if you want to stay with your provider you can use this as a platform to haggle.

7. Check the specialists

Drivers over 50 and drivers under 25 are statistically more likely than other motorists to be involved in accidents, which mean that they'll still pay more for cover.

However, black box car insurance, also known as telematics, can be used by any motorist looking to save money. A black box is fitted to your car, monitoring how you drive. If you can prove that you are a good driver you're rewarded, usually with cheaper cover.

If you're an older driver there are specialist providers, such as Saga, Age UK and RIAS, you can get quotes from.

[Source: http://www.which.co.uk/money/insurance/reviews-ns/car-insurance/finding-cheap-car-insurance/]