car insurance secret

Record rises in car insurance costs

Record rises in car insurance costs

Take cover: no need to panic--we've got tips to help you cut your car insurance costs.(Wheels): An article from: Entrepreneur



Car insurance premiums are now rising at the fastest rate in 15 years, according to The AA, so what's behind the rising cost?
If you're looking for cheap car insurance just now, you may want to move fast.

According to The AA's British Insurance Premium Index, we're in the middle of one of the steepest rises in car insurance since records began.

In fact, car insurance premiums are rising faster than at any other time in the last 15 years, increasing by 5.6% over the last three months and 14% over the year.

The AA suggests is down to fraud, personal injury claims, uninsured drivers and rising car thefts. Providers are actually paying out more in claims than they are earning in premiums.

Simon Douglas, director of AA Insurance, explains: "Most drivers will be seeing sharp increases when they renew their annual insurance premiums. The index suggests that 89% of insurers have increased their premiums by more than £5 over the past quarter. Only 2.5% cent reduced them."
Cutting car insurance costs

This means there's never been a better time to compare car insurance providers and make sure you're finding the best quotes.


People who use the moneysupemarket.com car insurance comparison page save an average of £157 a year. So, if your premiums are rising, comparing the market is a great way to find the right cover at the lowest price possible.

There are other ways to reduce your premiums. Read our article 'Beat rising fuel prices' for our top tips on driving down the cost of cover.
Cover for younger drivers

The AA's findings are pretty bleak for younger drivers. Third party, fire and theft (TPFT) cover - the kind typically bought by new motorists - rocketed by 9.3% over the last quarter.

Newbies looking for cheap car insurance quotes may be less than impressed to discover the average quoted premium even for such basic protection is now £1,059.

Douglas is concerned premiums may be unaffordable or even encourage younger motorists to risk driving without insurance.

How to cut the costs

How to cut the costs

Whether you live in a low or high risk area there are always steps you can take to drive down the cost of your car insurance. Here are our top tips on how to ensure you get the most competitive deal possible:

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Shopping around is the easiest and quickest way to save money. Many people assume loyalty pays but when it comes to insurance that is almost certainly not the case. Insurers know that many customers won't bother to move their cover elsewhere when their policy is up for renewal, so they reserve their best prices for new customers.

You should therefore shop around every year to compare prices from as many providers as possible to ensure you find the best deal. Moneysupermarket.com's car insurance tool makes this job easy as we compare prices from more than 100 insurers, cutting out all the leg work for you.
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Look at ways to reduce your mileage. When you carry out a quote you will be required to enter the estimated miles you drive per year: the more you drive the higher your premium is likely to be. So car sharing with a work colleague or taking another form of transport to work a couple of times a week will cut your mileage and bring down the cost of your insurance.
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Where you park your car overnight. This is a major factor when it comes to assessing the likelihood of you having to make a claim. If you can keep your car off the road overnight in a garage or on a driveway you are reducing the chances of it being vandalised, stolen or damaged by another vehicle. As a result, your premium will be lower.
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It's not just where you live and where you park your car that affects the amount you pay. The car you drive is the main starting point for how the insurer will calculate your premium. For example, driving a sporty little number may look and feel good, but the bigger and faster the engine, the more you will fork out. Changing to a smaller engine may not do much for your street cred but it will do wonders for your wallet.
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Increasing the excess you pay can cut your premiums considerably. Agreeing to pay a higher excess than you do currently is a good idea. However, you must remember in the event of a claim, you will have to stump up the excess amount - so make sure you amend this to an amount you can afford.
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Add an older driver. Adding an older, more experienced driver to your policy could again reduce the cost of your premium, particularly if you are young and have only been driving for a year or two. However, this person should only be added as a named driver - don't be tempted to insure the car in their name if you are the main driver. This is known as fronting. It's illegal and could invalidate your insurance.

Top 10 most expensive areas in UK for car insurance

Top 10 most expensive areas in UK for car insurance


Average
lowest
quote Postcode Postal area

£873.45 M13 Ardwick / Longsight / Chortlon-on-Medlock, Manchester
£839.87 B10 Small Heath, Birmingham
£821.12 M8 Crumpsall / Cheetham Hill, Manchester
£819.93 L7 Edge Hill / Fairfield / Kensington, Liverpool
£818.79 BD8 Girlington / Manningham / Lower Grange, Bradford
£818.59 B11 Sparkhill / Tyseley, Birmingham
£814.04 B12 Balsall Heath, Birmingham
£809.72 B8 Washwood Heath / Ward End / Saltley, Birmingham
£808.58 E12 Manor Park, London
£805.20 BT12 Falls, Belfast, Northern Ireland

The 10 cheapest areas in UK for car insurance

Is yours one of the most expensive car insurance postcodes?

When it comes to car insurance, motorists in Scotland are having the last laugh as they pay the lowest premiums, according to new research from moneysupermarket.com.

Analysis carried out on one million car insurance quotes over the last 12 months has revealed that out of the top ten areas, seven of the cheapest postcodes are in Scotland. The hardest hit areas are postcodes in Birmingham and Manchester which feature six times in the top 10 most expensive areas - with motorists in Manchester standing to pay £500 a year more on average than those living in Scotland.

However, while Scotland may generally be the cheapest part of the country for car insurance, Truro in Cornwall actually bags the top spot among individual postcode areas. Penzance in Cornwall is also in the top 10 as is Bury St Edmonds in Suffolk.

Here's the list of the top 10 areas and bottom 10 areas for car insurance:
The 10 cheapest areas in UK for car insurance


Average lowest quote Postcode Postal area
£355.72 TR1 Truro, Cornwall
£374.99 KY12 Dunfermline, Scotland
£379.26 KY6 Glenrothes, Scotland
£379.69 DD5 Dundee, Scotland
£381.50 AB15 Aberdeen, Scotland
£382.76 IP33 Bury St Edmunds, Suffolk
£383.33 FK3 Grangemouth, Scotland
£384.75 IV30 Elgin, Scotland
£385.68 TR18 Penzance, Cornwall
£386.13 DD2 Dundee, Scotland

In your car

In your car



Of course, your house isn't the only expensive asset at risk if flooding does strike, your car is also at risk and many people have been caught out by rapidly rising water and ended up trapped in their vehicles.

The weather makes it very likely that some people will have to make a claim on their car insurance, but what can you do to limit the risk? Here are some key tips:

* If you're at risk of flooding, try to move your car to high ground where it will be safe.
* Check your route before you leave your home - phone work and check the Environment Agency's website to be sure you can reach your destination.
* Carry a fully-charged mobile phone with you so you can request help if you break down.
* Do not drive into water - even if it looks shallow, it could be deeper than you think.
* Avoid leaving your car if you do become trapped, unless you are in direct danger. There will be less damage to the vehicle if you are towed out of the water.
* Do not try to restart a stalled car if you're in the water - this will suck water into your engine and cause far more damage.

It really is preferable to avoid driving in water as you risk becoming stuck. However, if you have to then avoid driving at speed and avoid other traffic, so you do not swamp other motorists.

The Institute of Advanced Motorists recommends staying in first gear, keeping the revs high and never taking your foot off the accelerator, even slightly. That could allow water to travel up the exhaust pipe.

Once you are clear of the flooding, it suggests drying the brakes by lightly applying them as you drive.

At your business

Flooding can devastate businesses, particulary smaller companies that do not have a disaster management strategy.

* If you're at risk of flooding, make sure your data is backed up.
* Put arrangements in place to inform staff if the workplace is inaccessible - you could organise a phone chain so that each member of the team phones one other.
* Follow the advice for protecting your home and move any valuable documents or company possessions as high up as possible.

The Federation of Small Businesses has opened its £500,000 disaster recovery fund for member companies in Scotland, Lancashire, Cumbria and the north-east of England.

Small firms can apply for interest-free loans of up to £5,000 to help them overcome flood-related crises.
Where to check the weather

It's all very well urging you to check the weather situation before travelling if you're in an at-risk area, but where can you find this information?

The Environment Agency is responsible for issuing flood warnings in England and Wales.

In Scotland, you can check the Scottish Environment Protection Agency website.

The Met Office carries localised information on weather and flood risks.

Your local radio station is also likely to carry regular updates on the developing situation.

Local authorities will be offering relevant advice for your area and setting up centres for evacuees. It may well also be able to offer you emergency supplies, including sandbags.
Essential numbers

Floodline: An advice and support number run by the Environment Agency for England, Wales and Scotland.
0845 988 1188

The National Flood Forum: This charity, which exists to support people and communities being affected by flooding, has a wealth of information and supportive advice.
01299 403055

The Rivers Agency provides advice on flooding for those in Northern Ireland.
0300 2000 100

Keep your insurer's details and your policy number in a safe place.

In an emergency, do not hesitate to contact the emergency services.

Why women win with car insurance

Well, moneysupermarket.com knows better than to wade into that particular debate but we can bring you some statistics that show what the car insurance companies believe.

Analysis of more than six million motor insurance quotes made through our website during the 12 months to June 2009 shows that men are paying an average of 71% more than women for their cover.
Why is this the case?

Insurance companies price for risk, and claims data shows that male drivers make more car insurance claims than their female counterparts.

Steve Sweeney, moneysupermarket.com's head of motor insurance, said: "Many insurance companies view women as being safer and more mature in the way they drive. This why their premiums are not only cheaper but also decrease with age at a much faster rate than those of men."
Isn't this just for teenagers?

Admittedly the price gap is at its widest for teenagers. An 18-year-old man will fork out an average of £2,318.83 a year for cover - that's 87% more than the average a female driver of that age will pay.

The good news for young drivers is that prices do start to fall once they reach their twenties; the average man then pays £1,004.25 a year - although the girls are still winning in the cost-stakes at an average of just £598.02.


 Age Male  Female  Difference  % difference
 18  £2,318.83  £1,237.33  £1,081.50  87.41%
 19  £1,873.31  £1,006.78  £866.53  86.07%
 20s  £1,004.25  £598.02  £406.24  67.93%
 30s  £473.13  £348.60  £124.53  35.72%
 40s  £331.08  £260.99  £70.08  26.85%
 50s  £249.16  £204.33  £44.83  21.94%
 60s  £200.41  £170.59  £29.82  17.48%
 70s  £217.90  £199.69  £18.21  9.12%
 80s  £308.82  £236.83  £71.99  30.40%
 Average  £885.86  £517.37  £368.49  71.22%