Car insurance premiums seem to be increasing constantly. The average premium now sits at over £600, and even careful drivers are seeing their premiums skyrocket when it comes to insurance renewal time. Here are six things that can massively increase your car insurance premium.
Where Your Park Your Car
Where your car is kept during the day and at night can significantly impact how much you will pay. Keeping your car parked off-road at night, preferably in a locked garage, can help to lower your premiums. Failing that, park on a driveway or in a carport. Parking on the street is the most risky option from an insurer’s point of view. If you have a choice of where to park, always go for the off-road option.
Paying For Car Insurance Monthly
Paying monthly in instalments is up to 30% more expensive than paying all in one go. Credit agreements for monthly car insurance have high interest rates, and drivers may pay £200 more a year than if they opt for an annual premium. If you cannot afford to pay your insurance in one go, putting it onto a credit card with a 0% interest period is cheaper than paying in instalments.
Driving The Wrong Car
From an insurer’s point of view, the wrong car is anything modified or powerful, likely to be targeted by thieves or, surprisingly, any automatic car! If you pass your test in an automatic, you might find yourself shelling out more than someone who can drive manual and automatic vehicles. Modified cars, or anything that is not standard, will attract a premium, as will a high-performance car. And if you drive an electric vehicle, your insurance could be up to 25% more expensive than a combustion-engined counterpart.
Poor Credit
You may be surprised to hear that poor credit can sometimes increase the price of your premiums. When you get a quote, insurers often do a credit check, and you may get a higher quote if you have poor credit. Insurers believe that people with poorer credit are more likely to be financially irresponsible, which could mean more insurance claims; therefore, quotes are raised.
Who Drives Your Car
Named drivers could be adding a hefty chunk to your car insurance. Having your spouse or significant other on your policy will cause prices to rise, but if you have younger drivers, especially those under 25, on the policy, it will skyrocket. Insurance for new drivers is expensive, so parents often consider adding them as named drivers to their existing policies. This isn’t necessarily a good option. The young driver won’t be earning any no-claims discount in their own right, which will ultimately cause their premiums to come down. It can also add thousands to the parent’s policy and damage their no claims if an accident occurs.
Where You Live
You can’t change this, but insurers look at local crime figures in the area you live before giving you a quote. If you live in an area with a lot of car theft, you will pay more. However, there are some things you can do to mitigate this risk. Fitting a car alarm and an approved immobiliser if you don’t already have one might help reduce your premiums. Some insurers will provide a discount if a tracker is fitted to the vehicle. And of course, if you can park your car away from the road and in a secure place.
You might also like our article on why insurance costs have increased.
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