Protecting your four wheels with car insurance is always a good idea, but it can often be expensive. Luckily, there are steps you can take to get cheaper car insurance.
We’ve compiled a list of do’s and don’ts to help you reduce your car insurance premium and provide ways insurers may offer car insurance discounts to protect both your car and your wallet.
For instance, if you drive an older car where the price of comprehensive car coverage would outweigh the market value of your vehicle, a more basic level of cover could be more suited to your insurance needs. This could be a policy like Third Party Property Damage or Third Party Fire and Theft, both of which will cover the cost of damages you cause to another car on the road but not the damage to yours (which can be very expensive if you have to pay for it yourself!).
However, another option could be to find a low-cost comprehensive car insurance policy, which can cover a much wider range of accidents, incidents and damages. Although comprehensive car insurance usually costs more than third party insurance, you could still find a policy within your price range.
Finding the right type of car insurance to suit your car is imperative to keeping down costs. A good way to search for policies that meet both your insurance and budget requirements is by comparing car insurance quotes with our easy-to-use comparison service.
Another key element in insurance calculations is the level of cover you choose. Taking out a basic tier of car insurance can help in reducing your insurance premiums, but the scenarios you can claim for will be limited. This could leave you with large out-of-pocket costs depending on the incident.
Do your research and choose a level of cover that matches your needs from a number of car insurance companies. You can find a policy to suit your circumstances by thoroughly reviewing your options and comparing car insurance premiums, extras, excess, product features and benefits.
When buying a car, it’s important to consider the cost of replacement parts and maintenance, since your insurer definitely will. While most cars are fine to drive, some are more expensive to insure than others simply due to them being harder to repair and harder to source parts for. This can drive up your premiums.
For example, some European cars may cost more to repair and maintain than cars manufactured closer to Australia (such as Toyota and Holden) because of the shipping costs and European parts and brands typically being more expensive. Your car insurance provider will factor all this in when assessing your insurance premium.
Many auto insurance policies allow you to pay for add-on benefits to increase your coverage. Examples of car insurance optional extras include windscreen excess waivers and a hire car after an accident. However, while these extras can provide more coverage, they’ll also increase your premiums.
Roadside assistance is often available as either an optional extra or a stand-alone product through many insurers and driving clubs across Australia. This product can help you get moving again after a breakdown.
If this option is available to you, choosing a higher excess is one way of getting a cheaper premium on your car insurance policy. While the aim is to pay a lower price for your cover, it’s important to think carefully and make sure you choose a manageable excess amount.
Remember that your excess is what you pay out of your pocket if you need to make a claim, so ask yourself if you can afford a $500, $1,000 or $1,200 excess.
Some policies offer a reduced premium for those who drive less than a specific number of kilometres per year. If you’re on the road less, you’re less likely to have an accident and make a claim, which could lower your premium.
Whatever your life situation, think about how much you use your car in a year and check with your insurer to see if you qualify for a low-kilometre policy.
Security devices and safety features such as alarms, dash-cams, immobilisers and reversing cameras could help you get cheaper car insurance. Since they help reduce the risk of an incident by giving you more tools to keep you safe or deter thieves, insurers may offer you a lower premium as a result.
Further to this point, parking your car safely at night, like in a locked garage or undercover parking, can help to reduce your overall car insurance cost. Parking securely lessens the risk of theft, vandalism or damage from an insured weather event than if your vehicle was parked on the street.
Always take the necessary precautions to ensure your car isn’t a target for theft. These include (but aren’t limited to):
Restricting the age of drivers on your policy can help reduce your premiums and potential additional excesses. If you nominate all drivers to be over, say, the age of 25, you can save on your car insurance premiums as younger drivers are typically more expensive to insure.
As long as no one younger than your nominated age restriction drives the car in an incident, you could save paying an inexperienced and young driver excess on top of your standard excess. Moreover, other car insurance policies may include an excess for unlisted drivers which could apply to anyone who isn’t a listed driver who was behind the wheel during an incident. In some cases, no cover will exist at all for unlisted drivers. Be sure to review the policy’s Product Disclosure Statement (PDS) to know exactly how it covers listed/unlisted drivers.
Be a good driver. Not only is it vital for your own safety and every other motorist on the road, but maintaining a good driving history may help you avoid paying more for your insurance. A bad driving record may mean insurers will charge you more on your insurance premiums. Overall, being a safe driver with a safe driving record influences your no claims discount (NCD) rating.
You may have chosen a low excess on your policy, but carefully consider the benefit to you before claiming. Each claim may affect your premium at the time of renewal.
Weigh up the cost of paying for the repair outright. Sometimes it might end up being cheaper, in the long run, to pay for repairs yourself than to make a claim to your insurer.
This is where your NCD is worth considering when deciding whether or not to make smaller claims. The amount you may save through a good NCD rating could be more than the savings made through claiming a windscreen chip, for example.
So, definitely claim on your insurance when necessary – that’s what it’s there for – but be smart and strategic about when and what to claim to protect your risk rating and future premiums.
Reviewing your cover and looking for a better deal is something you can do every year to reduce your car insurance premiums or to find a policy that you’re happier with. Comparing what’s out there and taking control of your finances will always be one of our biggest tips on how to save money on car insurance. It can also help you determine if you’re still getting value from your current cover.
Weighing up car insurance policies doesn’t have to be a chore when we can make it quick and easy.
With our free car insurance comparison tool, you can view products from our partners and compare features, coverage and excess. You just need to provide a few details to do so, and if you see a policy you want, you can apply straight away. The comparison process just takes a few minutes and could potentially help you save money on your insurance.
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