ONE little-known trick could help you slash the cost of your car insurance by hundreds of pounds a year as premiums soar.
Data from the Association of British Insurers (ABI) shows that on average drivers taking out insurance in January, February or March paid £478 for an annual policy.
Car insurance premiums have shot up for drivers in recent months
It means premiums have gone up by 16% from the same period last year – faster than inflation.
Car insurance costs have shot up to their highest rate since quarter four in 2019, when drivers were shelling out an average £483.
But there are tricks to cut costs if you know how.
You can start by choosing the right day to renew your policy.
And adding an extra driver to your premium could help slash costs by hundreds of pounds too, especially if you’re a younger driver.
According to Brake, one in five drivers crash within a year of passing their test and more than 1,500 young motorists are killed or seriously injured on UK roads every year.
Insurers generally charge higher premiums to younger drivers for this reason, because they are seen as more risky to cover.
But you can add another person to your premium, such as a parent, and drastically reduce what you’re quoted.
Kara Gammell, finance expert at comparison website MoneySuperMarket, said: “It is not always the case, but adding an extra driver to your car insurance policy can reduce the cost.
“This is generally useful for younger drivers, particularly for those who have just passed their test and are considered a ‘high risk’ to insurers.
“Adding someone who has more driving experience, no previous claims and is considered a much lower risk can bring down the average risk, meaning you are likely to be offered a cheaper policy – in some situations this could save you £100s.”
Research from Confused.com found motorists who add an additional driver to their insurance policy could save £261 on average.
The price comparison website found savings are greater for men, who could claw back almost £300 by adding their spouse, while the same move for women saves them £202.
While adding a named driver to your policy is a great way to cut costs as premiums rise, you will want to steer clear from “fronting”.
This is the car insurance term for when someone, often a parent or older driver, falsely claims they are the main driver of a vehicle when it is someone younger, or more inexperienced.
Kara warned: “Policies for young motorists can be eye-wateringly expensive, so it’s easy to see why fronting would appeal.
“However, it is illegal, and if an older motorist is falsely naming themselves as the main driver of a car then the insurance policy can be invalidated and the driver could even find themselves charged with a criminal offence.
“Whatever the situation, check how much it could cost in administrative fees to add a named driver and what excess they’ll pay if they should need to make a claim.”
Do I need car insurance?
It’s a legal requirement if you own and drive a car.
Car insurance offers you financial protection if you are in an accident, with three different levels of cover available.
You can opt for a fully comprehensive, third party or third party, fire and theft policy.
Fully comp policies are the highest level of protection and cover you, your car and anyone else involved in an accident – that makes them the most expensive.
The lowest level is third party, which is the legal minimum you must have.
It covers you for the costs of injury or damage caused to other people or their property.
However, you don’t get any protection if your own car is damaged or stolen.
You can pay for your car insurance in one lump sum ahead of the 12-month policy, or in monthly instalments.
Insurers then reward you if you make no claims in this period by, generally, lowering your premium for the next 12-month period.
This is called the “no-claims bonus” and can see your premium drop by 30% after one year to 65% or more after five years.
That said, many drivers have still been seeing their premiums go up in recent months despite making no claims or having a change in circumstances.
This is due to, among other factors, energy inflation and the rising cost of carrying out vehicle repairs being passed on to consumers.
How else can I cut car insurance costs?
Beyond adding a driver to your car insurance policy and renewing on the exact right day, there are other ways to cut costs.
One woman recently told HOAR how she slashed her premium by £250 after taking out a black box policy.
The policies reward motorists for driving carefully and are generally aimed at younger people.
But you can take them out if you are older too, and they can save you hundreds of pounds.
Meanwhile, if you’re someone who doesn’t drive that much, a pay-per-mile policy can be worthwhile.
Payments are based on the miles you actually drive, rather than a flat monthly or yearly fee.
Julie Daniels, motor insurance expert at Compare the Market, previously told HOAR: “Almost one in five motorists who drive less than 4,000 miles per year could save up to £168 on average by swapping to a pay-by-mile policy instead of an annual comprehensive car insurance policy.”
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