December 03, 2018 at 6:34 PM
Finding the best car insurance can often seem like a daunting task, and people frequently rely on a wide variety of facts in order to purchase what they think is the best car insurance for them. In reality, many of these “facts” are myths, and knowing the truth could help you save money on your car insurance. So to help you out, we have put together 12 common car insurance myths, and explained what is really the truth behind each one.
1. It’s cheaper to stay with your existing insurer.
Many people believe that their car insurance will be cheaper if they stay with their current company, as they will get a loyalty discount. However, this often isn’t true. You don’t always get rewarded for loyalty, and auto-renewal of insurance is actually one of the biggest ways in which people over-pay for their car insurance. You can make great savings by comparing different deals and shopping around.
If you want to stay with your current insurer, they may offer some kind of discount if you get in contact with them and let them know that you are considering moving. For example, showing them a lower quote from somewhere else can prompt them to match that quote, in order to retain your business! This won’t always work, but it’s worth a try.
2. Either going direct or going through a comparison site is always cheaper.
Some people swear by going direct with the insurer to get the best cost, while others will always use a comparison site. In reality, neither of these options is always the cheapest. Whilst comparison sites can offer good deals, they may end up costing more due to the fees of using a middleman. However, cutting out the middleman by going direct to the insurer isn’t always cheaper, as they factor in costs such as advertising into the prices they charge.
In reality, the best option is to look at comparison sites and quotes direct from insurers, and compare your options to make sure you are getting the best deal possible.
3. Older cars are always cheaper to insure.
This one really depends on the car and the insurance provider. Older cars can be cheaper because their value tends to be lower. However, their lack of modern features can make them easier to break in to, which could drive up the cost of insurance. It’s always best to check what your options are before purchasing a car, to make sure you are getting the best out of your money.
4. Third party policies are the cheapest option.
Many drivers assume that the lowest level of car insurance cover must be the cheapest option, however this isn’t always the case. A fully comprehensive policy can be as cheap, and sometimes even cheaper, than a third-party policy.
This is because drivers who choose a lower level of cover tend to make more claims, which drives up the overall cost. Always make sure you look at quotes for various levels of cover, to make sure you are getting the best deal available.
5. Parking in your garage makes your insurance cheaper.
A very common misconception is that storing your car in a garage will make your insurance premium cheaper than if you park on a driveway. However, the reality is that the difference may be very small, and sometimes it is more expensive to park your car in a garage. This can be because you are more likely to damage your car whilst entering or exiting a garage than by parking on a driveway. Plus, your postcode may play a part, as in some areas more claims will have been made for theft or damage when cars are parked in garages than on driveways or streets.
6. Lower mileage equals cheaper insurance.
Many customers assume that if they drive fewer miles their insurance premium will be cheaper, however this is not always true. This is because those who drive fewer miles may be seen as having less confidence behind the wheel, and so therefore more likely to be in an accident.
This varies across providers, so when looking at different insurance options it is important to be clear on how mileage could affect the cost. If you do drive fewer miles than the national average, options such as low mileage or “pay-as-you-drive” packages may be a cheaper alternative.
7. Putting your policy in a parent’s name is a hack to reduce insurance costs.
If you are a younger driver, then your insurance costs will be higher than more experienced, older drivers. This can tempt some young drivers into putting a parent down as the main driver, to reduce the costs of their insurance premium. However, this is called “fronting”, and not only is it illegal, but it can result in fines of up to £5’000. It can also make it harder for you to get car insurance in the future.
It’s perfectly legal to add a parent’s name as a secondary driver, and this may well bring down the cost slightly, depending on the provider. Just make sure you don’t put them as the main driver!
8. Your job title isn’t important.
It’s common to think that providing your occupation to insurers is just an administrative detail. However, it can indeed have an impact on the cost of your insurance policy. And it all comes down to the exact wording of your job title. For example, Money Wise found that a “restauranteur” paid £93 a year more than a “café owner”. Subtle changes can reduce your premium, however it must still accurately reflect your occupation, to ensure any future claims will be accepted.
9. The colour of the car is important.
A common myth is that red and black cars are more expensive to insure – often leading to people avoiding those colours for fear of higher premiums. In reality, studies in a number of countries have shown that there is no conclusive evidence of car colour having an impact on your insurance. In fact, many companies won’t even ask!
10. A speeding ticket always increases the cost of insurance.
Many people assume that having 3 points on their licence for a minor speeding offence will automatically increase the cost of their insurance premium. This can be true, but it depends on a number of factors, including the provider, the number of offences, and how fast above the speed limit you were driving. It’s always worth checking with the insurance provider on their policies surrounding this, to ensure you are getting the best deal.
And always be honest with your provider – if you fail to tell them about a speeding offence, it could invalidate your policy, affecting any future claims you may make!
11. A broken-down car doesn’t need to be insured.
If your vehicle is broken down or even written-off, it still needs to be insured until you declare it as being off the road. This can be done using a Statutory Off-Road Notice (SORN). If you don’t do this, and your vehicle is not insured, then this is an offence. So even if you are not driving your vehicle, make sure you are not liable by either keeping it insured or submitting a SORN!
12. You are always covered to drive to and from work.
In order to drive your vehicle to and from work, your insurance policy needs to cover you for “commuting”. In addition, if you need to travel between places of work you must be covered for “business mileage”. If your policy terms do not include this, and you are involved in a collision during such a journey, your insurer may not cover you for any damages. This could also result in your insurer charging you a higher premium, or declining to insure you at all!
Hopefully debunking these 12 common car insurance myths has cleared some things up for you, and helped in your quest to find the best car insurance for you. We cannot cover everything here, so most importantly you should check your policy documents or contact your insurance provider directly if you have any questions, queries or worries.