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Clare Francis: The internet has revolutionised the task of shopping around for insurance - moneysupermarket.com's motor insurance channel lets you compare more than 100 quotes in a matter of minutes. It really is straightforward and independent research shows that motorists can save around £155 a year by shopping around in this way.
However there are some things you need to get right otherwise you may find that you're not paying the right amount for your insurance, or in the worst case scenario you may find your cover isn't valid. So I'm with Steve Sweeney today, who's an insurance expert here at moneysupermarket.com - he's going to explain everything you need to know about getting a car insurance quote.
Q1: Steve it's never been easier to get a quote and compare quotes for car insurance, but there are things that you do need to watch out for and information you need to have to hand, so can you just talk us through the process of what people will be asked when they're getting a car insurance quote?
Steve Sweeney: Yes, no problem. I guess really the first place to start is really with the basics - things like your car registration, your annual mileage that you think you're going to do, any no claims discount that you've perhaps achieved in the past or actually you may have had a claim in the past so you do need your details of that as well, where perhaps you're going to keep the car - so as much detail as possible that you can have to hand because you're going to be asked all these questions through the journey.
Q2: There might be things though that people are a bit unsure about - for example I had a claim on my car insurance a few years ago - [when] remembering the exact date and the value of the claim people might be a bit fuzzy or hazy on that. Is a rough 'September 2007' or whatever enough, or do you really need to know the exact date it happened and the exact value?
SS: What an insurer's trying to do is they're trying to build up a picture of your need really, and also develop a risk profile. The more information you can give them, the better the quote they can actually give you. The reality is on our journey you will be asked to supply the date of a claim, details around the claim, because what we want to do is pass as much information to the insurer as possible, so the quote that you receive on moneysupermarket.com is as accurate as possible. So providing that information means you're going to get a more accurate quote.
In the instance you've just described, if you were a bit hazy on the information, I wouldn't advise skipping the question at all - I would put in as much information as you possibly can - but if the insurer isn't sure with the answers that you've given, there is always an opportunity on the insurer side of the website to amend details, and if they have any further queries you are leaving your telephone number, your email address etc. They will either write to you or give you a call if they're not sure so it's about making sure that the policy is absolutely right for you.
Q3: And there are some things that really are crucial aren't they, that you [should] make sure that you really are honest and that you don't give incorrect information such as like where the cars kept overnight, how you are using it - are you going to be using it to drive to and from work or for business use at work - because you have to ensure that you are properly covered?
SS: Yes absolutely, that's crucial. At the end of the day if you were to have an accident whilst on business use and you weren't covered for business use, that that's obviously an issue with the insurer.
I would advise that people are absolutely honest, don't say that you're keeping it somewhere else when actually it's going to be kept at your house - so for example don't say it's going to be kept at your parents house when it's going to be kept at perhaps your house - so you must put down the postcode where the actual cars going to be kept.
Is it going to be kept in a garage overnight or is it going to be kept on the road? Please don't take the temptation to say it's going to be kept in a garage when the reality is that it's parked on the road on most occasions. We just want to make sure you're covered, so give accurate information would be my advice.
Q4: And it proves a completely false economy doesn't it - you might think it will get you a slightly lower premium to say the cars parked in a garage overnight, or you don't use your car to drive to work, but as you say if you need to make a claim and the insurer discovers that you have mislead them in that way it could potentially invalidate your cover can't it?
SS: Yes absolutely, it gives you an issue with the insurer as I'd described it, in other words it invalidates your cover. Essentially you're insuring your car so if the worst came to the worst and something happened with your car then the insurer pays you a sum of money which is equivalent to the value you would need to replace that particular car. So if you're not giving accurate information the insurer isn't going to give you that money so you must give accurate information - [to do otherwise] is a false economy as you've described.
Q5: But then there are things you can do to bring down the premium in a sort of valid way, such as if you only use the car sparingly - if you don't use it very much you know how many miles you're going to do roughly. If you're only going to be doing 6,000 or 7,000 miles per year, you're going to be paying less for your cover than if you were doing 20,000?
SS: Yes, it's all down to risk. The more you drive the car the more risk there is that something could happen to that particular car, so the less you drive consequently you're less of a risk. I would advise customers to really think about how many miles they're going to do.
A good way of doing it is just to think about how many miles they did in a previous month, or perhaps how many miles the car would do on one tank of petrol - people know roughly how many tanks of petrol they'll use in a month - and then scale that up, multiply it by 12 and you've got your estimated annual mileage. And give an accurate figure, because that really can affect the policy quote that you're going to receive.
Q6: What about paying annually versus monthly, because most insurers will allow you to do either/or, but if you can afford to its often cheaper to pay up front annually isn't it?
SS: Yes, most insurers apply an APR or an interest rate to the premium if you pay monthly. If you pay annually you're essentially paying it upfront, paying the entire premium in one foul swoop, you don't need to pay anything for a following year, so if you can the cheapest way is to do it annually. Clearly customer who wants to pay monthly will pay a premium for that monthly payment.
Q7: And then finally I suppose the other thing is getting into the habit of making sure that you do compare quotes and prices every year when you are up for renewal, because the temptation is when you get your renewal quote through the letterbox its easy just to renew with the same insurer. But it's easy to do it - we have shown how easy it is to do it online, so there is no excuse really?
SS: There isn't an excuse, and circumstances change - you may receive your renewal but a lot of people may have one more years no claims discount. So it is always wise to go back through moneysupemarket.com, recheck your quote and get a new results table really because you may find that another insurer has decided to be much more competitive year on year. It may be that you can improve your cover for that same price. I would always advise people to check their renewal by going through moneysupermarket.com and using our customer journey.
CF: Brilliant, thanks Steve.