With energy prices soaring by an eye-watering average of £693 annually, national insurance deductions rising and a car tax price hike, households across the UK have been left wondering how they'll cope.
The UK inflation rate has also reached a 10-year high and the nation is now facing a cost of living crisis.
And, as many are concerned about being plunged into poverty, MPs are set to receive a pay rise to mirror "the average increases across the public sector".
While costs for motorists are rising, there are still plenty of ways to ensure that you're not paying over the odds for things like car insurance.
So, we've got some expert tips and tricks that you can use to nab a bargain when it comes to renewing your car insurance bills and quotes.
10 ways to reduce your car insurance bills and quotes in the UK
If you're guilty of allowing your car insurance to auto-renew each year to avoid the faff of shopping around for competitive quotes and deals, this is your sign to stop.
According to the price comparison website MoneySuperMarket, roughly 17 million Brits overpaid on their car insurance in 2021 by £50.
Check out these easy expert-backed tips that'll help you save hundreds of pounds each year.
1. Shop around and utilise cashback deals
Following a new rule banning car insurance firms from charging existing customers more than new ones, new drivers are in a great position to shop around for the best deals and prices as you aren't tied in with any companies just yet.
While the new rule should also benefit existing customers, founder and director of CarMats.co.uk Ash Young says it's well worth seeing what deals are out there with other insurance companies.
Whether it's using comparison sites, calling up car insurance firms to shop around or requesting quotes online, try to set a morning aside to see what else is out there.
And, you may be surprised to discover that you can claim cashback upon renewing your car insurance policy each year.
Again, you'll need to do some digging to find the best deals and offers as they can vary drastically in price and value. However, sites like Topcashback offer decent chunks of money back when you switch insurers using their services.
While insurance companies are now banned from hiking prices for existing customers, Young warns: "The new law doesn’t mean your insurance bill will remain fixed and insurers could still increase your premium based on your potential risks.
"This includes your neighbourhood and your annual driving record, among other factors."
2. Lower your mileage
A genius hack from Carmats.co.uk suggests remembering to lower your annual mileage, given that the pandemic has slashed many people's commutes.
If your job means you're able to work from home, ensure that your car mileage insurance figures are reflecting that, too.
Some companies will offer discounts or reduced prices in quotes for those with lower mileage, so it could be time to swap four wheels for two and start cycling for shorter distances.
3. Use the correct job title
The job title you select when applying for car insurance can have an astronomical effect on the amount you pay each year.
According to comparison site GoCompare, those on the hunt for the most reasonable deals could be making pricey mistakes in the occupation selection stage.
Research from GoCompare found that those who select 'chef' rather than 'kitchen staff' pay an average of £98 more. Keeping your niches hidden also pays off, as 'music teachers' pay an average of £86 more than those who select 'teacher'.
The company also found that those who are 'retired', an 'occupational therapist' or a 'research scientist' benefit from the cheapest quotes. Those paying the most include 'fast food delivery driver', 'taxi driver', 'shopkeeper' and 'courier'.
To avoid being caught out, it's best to check all categories that suit your job title and select the one that fits yours best without tiny wording differences that cause price hikes.
However, it's crucial to ensure that your category selection is accurate and does not misrepresent your role to avoid invalidating your cover.
4. Leave plenty of time to renew
Many of us are prone to leaving life admin until the very last minute, whether it's sorting bills, taking your car to the garage or even posting a simple letter.
When it comes to car insurance and cutting your costs, preparation is key. In fact, MoneySavingExpert.com's research claims you should start looking for deals or switching for a better deal three to four weeks prior to the renewal date — 21 days is the 'sweet spot'.
According to the comparison site, quotes fall prior to that time period and then begin to rise.
Start by making a list of competitor car insurance firm quotes before haggling with your current provider. If they're unable to price match, it may just be time to switch.
If you're leaving it until the day before the renewal deadline to do this, your existing insurance company will know you have far less wiggle-room and need a quick solution. You'll therefore be likely to pay far more than necessary and be locked in for another year of overpaying.
5. Make use of multi-car insurance
CarMats.co.uk founder Ash Young suggests motorists should look into purchasing multi-car insurance if they've got a family of motorists with two or more vehicles registered to the same address.
He explains: "Not only is a joint-car policy more convenient to subscribe to, saving you time to acquire, but it often works out cheaper by combining the cover of all vehicles."
For example, a quick look on Admiral's website shows that the car insurance company offers "MultiCFar discounts when you insure more than one car" with them.
Meanwhile, Aviva state that customers can save 10% "for every additional vehicle you add, registered at the same address".
6. Pay the year upfront
Given the cost of living crisis, this one is likely to be tricky for households across the UK. However, if you are able to, paying your car insurance bill in full for the year can sometimes save you money.
Ash Young explains: "Most major insurers will offer a discounted price for a one-off payment as it guarantees their payment for the 12-month period.
"It also means you will avoid entering into a credit agreement that involves paying interest on the sum calculated by your insurance company."
So, should you be in a position to fork out the full amount upfront, MoneySuperMarket.co.uk research suggests that you could be saving at least £62 over the year from monthly payment fees.
7. List another experienced driver on the policy
If you've got a family member or partner who's got a clean slate on their driving record with no claims and several years of experience on the road, add them to your policy.
Of course, you'll need to ask their permission first and still be extra careful when driving, but it could save you big bucks on your quote.
And, if your close friends or family aren't your ideal insurance policy candidates, Martin Lewis referred to a man who cut his car insurance bill by £200 by listing a colleague who'd been driving for 10 years on his policy.
8. Save hundreds by ditching extras
Whether you were being cautious when signing up or simply had them included in your quote without realising, extras can rack up extra costs on your car insurance.
Every extra and add-on contributes to the rising cost of your insurance premium, a cost that you want to be cutting with the crunch ahead.
While things like windscreen cover, breakdown cover and driving abroad are important, they're often covered by other your AA membership, travel insurance and home insurance.
Prior to renewing your car insurance, take time to look at every single extra on your policy or contact your insurer and ask for a rundown. Then, deduce what's already covered elsewhere and start making those cuts.
9. Use a black box
While it may sound extreme, if you're confident in your driving abilities getting a black box makes for a great way to cut those car insurance bills.
Ash Young explains: "Some insurance companies offer ‘Black Box Insurance’, which records and transmits data about how you drive to your insurer."
Sometimes known as a 'telematics policy', this form of insurance involves having a black box installed in your car, which monitors your driving habits and techniques.
The better you drive, the less you'll pay in insurance premiums.
And, if your driving has been a tad below par in the past, opting for a black box could also be a great way to encourage you to up your game and drive more cautiously and carefully.
A little-mentioned perk of the black box is that you'll also be able to get free theft tracking with selected insurers. So, if your car's stolen you may have better chances of the police finding it and reuniting you with your motor.
10. Purchase an insurance-friendly car
If you're looking to buy a new car, or even purchase your first, it's vital that you keep your car insurance in mind when shopping for your new wheels.
Each car belongs to a car insurance group and there are 50 of these, in total, which dictate just how expensive or cheap it will be to insure your vehicle.
The car insurance grouping factors include:
- New car prices, replacement and repair costs
- How long your new car would take to repair
- The price of car parts
- How secure your car is in terms of alarms, door locks and other elements
- Your car's top-speed and performance levels — the speedier the more pricey it'll be
- Overall car safety including AEB systems
Do your research and analyse lists of the cheapest cars to insure before buying. Keep an eye out for these as they are regularly updated and published. It's important to note that these also vary depending on the buyer's age bracket.
