What Affects the Cost of Car Insurance in the UK

UK car insurance is priced on how likely the insurer thinks a claim is and how much it would cost. That comes down to five things: who drives, what they drive, where it is kept, how it is used, and the cover chosen. Some you cannot change. Several you can.

The driver

• Age and how long you have held a full licence.
• Claims and convictions in recent years, usually the last five.
• Your no-claims discount: the number of consecutive years without a claim.
• Your occupation, which insurers rate. Describe it accurately; do not pick a title because it prices better.
• Other named drivers, who can raise or lower the price.

Insurers in the UK are not allowed to use whether you are a man or a woman to set the price.

The car

• Its insurance group, from 1 to 50. Lower groups are cheaper to insure.
• Its value and age, and the cost of repairs and parts.
• Engine size and performance.
• Modifications, including alloy wheels, tinted windows and tuning. Declare all of them.
• Security: an approved alarm, immobiliser or tracker can help.

Where it is kept and how it is used

• Your postcode, and whether the car is kept on a drive, in a garage or on the street overnight.
• Annual mileage. Estimate it honestly; many people overstate it.
• Class of use: social only, commuting, or business.

The cover and how you pay

• Level of cover: third party, third party fire and theft, or comprehensive. Comprehensive is not always the dearest.
• The voluntary excess. A higher excess lowers the premium and raises what you pay on a claim.
• Extras such as breakdown cover, legal expenses and a courtesy car.
• Paying monthly. It is usually a credit agreement with interest, so the year costs more than paying once.

Keeping the detail right

An insurer prices on what you tell it. You have a duty to take reasonable care to answer accurately, and an inaccurate answer can reduce or void a claim. Tell the insurer when something changes during the year: an address, a job, a modification or a new driver.

Add your car insurance to Wisemium and it keeps the insurer, the premium and the renewal date on record and shows the date as needing attention as the renewal comes close. When you want quotes, it hands you to an FCA authorised comparison partner. Wisemium does not compare, recommend or arrange insurance itself.