Why is my car insurance so high?

Why is my car insurance so high?
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Is your car insurance on the high side? Here’s a look at why this might be the case, and some tips for getting cheaper insurance.

Reasons why your car insurance is high

While there’s no single reason why your car insurance is a little on the high side, here are the most common reasons why you’re paying more. 

1. Where you live

Yes, unfortunately, your postcode can affect your insurance cover. If you live in an area where the numbers of car accidents, car theft or uninsured drivers are high, you’re probably facing higher insurance prices. 

2. Your age

If you’re under 25, you might pay more for your insurance.

Why? Well, it comes down to driving experience. Younger drivers typically have less experience, so in theory, they’re more likely to have an accident. As a result, they often pay more for insurance than older drivers.

Are you a young driver looking for insurance? Check out our article on finding cheaper insurance as a young driver.

3. Your vehicle

The vehicle you’re driving can affect your car insurance premium. Essentially, all cars are placed in one of 50 insurance groups. Cars in group 50 are the most expensive to insure, whereas cars in the lower groups are cheaper. Typically, it’s also more expensive to insure:

  • modified cars
  • vehicles with high mileage 
  • imported cars
  • electric models (including hybrids)

If you’re trying to reduce your car insurance, consider the make and model of your vehicle carefully before buying it.

4. Previous car insurance claims

Essentially, the more claims you’ve made in the past, the riskier you are considered to be to insure. So, to offset this risk, insurers might increase the cost of your car insurance policy. 

5. Driving licence points

Do you have any points on your driving licence? Or have you ever been disqualified from driving? If so, you’ll probably see an increase in your insurance premiums – at least for a few years, anyway.

6. Car insurance fraud

When people make fraudulent claims on their insurance, the cost of insurance rises for everyone. This is another one of those factors that are beyond your control. While the Insurance Fraud Bureau (IFB) is doing what it can to tackle the issue, it remains a problem that can impact your premiums.  

How to lower your car insurance 

Is your insurance on the higher side? Here are a few tips for lowering your premium

1. Increase your excess

Your excess is the amount you pay towards the cost of any repairs. You can lower your insurance premium by paying a higher excess. However, this does mean that you’ll pay more if you make an insurance claim, so bear this in mind! 

2. Don’t auto-renew

Rather than renewing your policy each year with the same provider, shop around for a new quote. If you’re unsure where to start, check out price comparison sites such as Confused.com and MoneySuperMarket.  

If you find a cheaper quote but you’re happy with your current insurance provider, you can always ask if they’ll match the quote. 

3. Limit your add-ons

Insurance policies often come with extra features, such as courtesy car cover, or protection when driving abroad. However, unless you need these extra protections, you’re simply paying for cover you don’t need. Check your policy carefully and remove the extra features you won’t use. 

4. Add another driver 

If you’re a young or fairly new driver, you can sometimes lower your premium by adding a more experienced driver to your policy. However, to be clear, it won’t always work out cheaper to add a second driver, so check your policy for details.   

Car insurance: takeaway

There are many reasons why your insurance premium may be high. However, if you shop around and spend time looking for the best deal, you can often find cheaper car insurance elsewhere.

Here’s one final tip: if you can afford it, consider paying for your car insurance annually, rather than monthly. Why? Because insurance providers typically charge interest on monthly payments, so paying a single lump sum could save you money in the long run. 

If you’d like some more advice on lowering your premium, check out our article on finding cheaper car insurance

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”.

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