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When should you attempt to lower your car insurance premium?

By:  Karl Talbot | 3rd August 2021

Car insurance can be pricey, so how can you cut the cost of cover? Is there a trick in choosing the best time to lower the cost of your car insurance? Let’s take a look.

How is car insurance calculated?

The price of your quote is mainly determined by your level of risk.

If an insurance provider considers you likely to make a claim, it will quote you a higher price than someone deemed less likely to have an accident. To determine your risk, an insurer will consider a host of factors including:

There are other factors to consider too. For the full list, see our article on how much you should be paying for your car insurance.

I haven’t made a claim: why has my premium increased?

While a number of factors can influence the price of car insurance, sometimes your renewal quote can defy logic. For example, you may be quoted a higher price at renewal even if you haven’t made any claims. The way insurers work isn’t always transparent, and some may quote you a high renewal price, hoping you’ll simply auto-renew.

To ensure you cut the cost of your car insurance, take the time to compare quotes from a number of different providers. The easiest way to do this is to use a price comparison website. MoneySuperMarket, GoCompare and are all popular choices.

If you can, it’s worth checking more than one comparison site as not all insurers feature on all of the comparison services.

Will you definitely be able to lower your car insurance? While it’s not guaranteed, car insurance prices are the lowest they’ve been in seven years, so the odds of finding a cheaper quote are heavily in your favour.

When should I try to lower my car insurance premium?

Most people looking to lower the cost of their car insurance do so at the date of renewal. This is understandable as changing insurers at renewal makes it easy to assess how much you’ve paid over the past year and compare it with a new quote. 

Changing car insurance at renewal also allows you to rack up an extra year of no claims (assuming you haven’t made a claim in the past year).

If you do decide to ditch your current provider at renewal, make sure that you notify them in writing within the correct timeframe. To avoid driving without any insurance, it’s a good idea to make sure that your new policy starts on the same day that your existing cover ends.

Do I have to wait until renewal to switch?

While most people switch at renewal, do note that you can also switch your car insurance mid-policy. This means you don’t have to wait to compare providers on a specific date. If you do this, there are three things you’ll need to bear in mind.

1. You won’t get the extra years of no claims

Switching mid-policy means you won’t be able to add the current year to your no claims discount. That’s because car insurance no claims discounts are measured in years, not months. 

2. You’ll probably have to pay an early exit fee

If leaving your provider halfway through a policy, you’ll almost certainly have to pay an early exit, or termination, charge. 

Paying to exit a policy early is far from ideal. However, if your new quote is significantly cheaper than your existing policy and the difference is greater than the cost of the fee, then it’s probably worth switching.

3. You’ll have to work out your own switching date

Switch at renewal and it’s easy to start your new policy on the same day your old policy ends. However, switch mid-policy and you’ll have to work out a suitable date to move providers.

While you may be keen to move to a cheaper policy as soon as possible, always ensure your existing provider has had enough time to process your cancellation request.

When is the best time to lower my car insurance?

Ultimately, there’s no right or wrong answer in terms of the best time to switch your policy.

While switching at renewal and comparing quotes every year is probably best practice, if you’re already paying too much for your car insurance, looking to lower the cost mid-policy is certainly not a bad idea.

See our recent car insurance articles to learn how you can further cut the cost of cover.

4 iron-clad rules for saving money on everything

Our Editor Sam Robson has been on a personal cost-cutting mission for years – and it’s time to share his wisdom.

Check out his choicest saving tips and tricks in this free report, “Sam’s 4 Iron-Clad Rules For Saving Money On Everything”.

Just enter your email below for instant access to your free copy.

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