How Much Should I Be Paying For Car Insurance?

Car insurance payments represent a major financial drain, and a lot of people end up wondering why they end up paying so much for their insurance. In terms of how much you should be paying, the amount can be defined by national averages, as well as by your age and driving experience. Recent changes in terms of gender discrimination and car insurance similarly affect how much insurance you’ll pay for your vehicle. When looking at these (somewhat depressing) figures, it’s worth considering some of the ways in which you can reduce what you’re paying for your premiums.

Average car insurance premiums in the UK

Most car insurance premiums in the UK now average out at just over £1,200 a year, which applies to male and female drivers. Car insurance rose by 4.3 per cent in the summer of 2012 in line with the economic recession, and increases in terms of other forms of insurance around the country. Disputes over whiplash injury claims, and the general inflation of insurance premiums, have also contributed to increases across the board.

Car insurance for teens: expensive

The worst affected drivers continue to be 17-22 year old drivers, who can pay more than £5,000 a year for their car insurance in some parts of the UK. The risks associated with young male drivers of inexperience, and taking chances with their cars, makes them a consistent danger for insurance companies. Recent EU rulings on how insurance companies cannot base their decisions on gender, should mean that women will be paying more in terms of premiums. In terms of top premiums, women have traditionally paid about £200 to £300 less a year, but will experience a price rise from 21 December 2012. Older drivers above the age of 40 will continue to experience lower premiums of about £700-£750, with much less difference made as the result of gender.

Lower premiums with pay as you drive

In both cases, however, drivers will be affected by higher premiums. There are alternatives, however, that can help you to reduce the overall cost of your insurance policy during the year. One option is to take on telematics insurance. A pay as you drive scheme, telematics involves installing a black box in your car that records your driving habits. Information is recorded on how safely you drive, from speed to cornering, and even the time of day that you normally drive. This information can be used by insurance companies to create a more accurate quote for your driving, with the chance to reduce premiums and receive bonuses for good driving. Young drivers penalised by premium increases, but who are safe drivers, can particularly benefit from these telematics schemes.

Other options for lowering your insurance premiums include basic fixes like paying annually, rather than monthly, to avoid high fees. Demonstrating a commitment to safety by locking your car away in a garage overnight, and not making expensive alterations to your vehicle, will also help in working out long term policies. Multi-car insurance policies, where multiple cars at the same address go with the same provider, can also result in lower average premiums, with individual excesses and no claims discounts retained for cars.