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Top tips for saving money on car insurance

Car insurance premiums can be reduced if you take some time before renewing your policy

Car insurance premiums can be reduced if you take some time before renewing your policy. Even if you've built up a tidy no-claims bonus, do not accept a renewal quote from your existing insurer. Customer loyalty in the insurance business is worth almost nothing. All the big insurers chase new customers by offering big discounts, often charging half the price they charge to existing customers for exactly the same cover. It's even worth applying to your existing insurer as a new customer you'll find out how much they are over-charging you. Before renewing your policy shop around and enquire for more quotes and remember not all comparison sites include every online insurance company, so you will have to do a manual search on their site to ensure you've really covered the market.

Don’t be tempted to pay for your car insurance monthly because it appears to be cheaper or more manageable. You will be charged interest, typically around 24%, adding £50 to the average car insurance bill. Just over half of Britain's 26 million insured drivers are paying monthly, and cumulatively handing the insurance industry £624m in unnecessary payments. Even if you put the bill on your credit card and take two or three months to pay it off, it will be cheaper than spreading it over 12 months at 24% interest.

It is also advisable to ask about other discounts, you may qualify for being accident free, renewing your policy, driving relatively few miles each year, taking advanced driving courses, etc. If you own more than one car you may reduce your policy by cancelling the provision of a courtesy car if involved in an accident. You would not need a courtesy car if you have access to another car.

Try and keep your driving licence clean, all speeding offences hike up your insurance premium and disqualification will almost double your premium. Sometimes adding another driver on to your policy can reduce the premium strange but true it only works if the other driver has a clean safe record. It may also be worth installing Thatcham-approved security measures such as vehicle tracking devices. The Thatcham Motor Insurance Repair Research Centre evaluates the effectiveness of car security products against the British insurance industry's criteria. Most insurers acknowledge the benefits of these devices and, in turn, give you discounts.

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