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No-deposit car insurance

Can you get car insurance without a deposit?

There’s no such thing as no-deposit car insurance, but you may be able to find other ways to keep your up-front costs low

By Kevin Pratt

Published: 01 October 2019

Woman relaxing in the passenger seat of a car

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Can I get car insurance without a deposit?

It is not currently possible to get car insurance without putting down some form of deposit. Certain providers might advertise ‘no-deposit car insurance’, but all car insurers will require you to pay at least some money up front.

This doesn’t mean that there aren’t ways to keep your initial on car insurance costs down – just that you’ll always have to pay at least a small deposit at first.

What is no-deposit car insurance?

Most products sold as ‘no-deposit car insurance’ are actually monthly insurance policies where the initial payment is spread out across the year.

Insurers typically ask for 20% of the value of your car insurance in the first month. Some insurers will allow you to avoid paying this sum in one go. However, all this means is that you’ll be borrowing the money for your initial payment and paying it back in instalments – with interest.


The average cost of car insuranceAccording to MoneySuperMarket data correct as of August 2019

Policies sold as ‘no-deposit car insurance’ are typically more expensive overall, because your premiums are adjusted upwards to absorb the cost of the deposit you’re not paying.

So if you want to minimise your costs, make sure you consider the total price of your insurance policy, not just the first month. Either way, you will not be insured to drive until after you’ve made your first insurance payment.

Is it cheaper to pay car insurance monthly?

When buying car insurance, you’ll often have the option to pay for an entire year’s insurance in one lump sum, or to spread the cost over the year with monthly payments.

Paying monthly is more manageable, because you won’t have to find the money for a full year’s premiums in one go. But paying monthly for car insurance is always more expensive, as insurers will charge interest and sometimes impose extra fees – they are basically charging you for the convenience of paying monthly. If you can, you’ll save money by paying annually.

How can I pay less up front for car insurance?

The best way to avoid paying large up-front fees for car insurance is to use a price comparison site like MoneySuperMarket. Let us know a few details on you, your car and your driving history, tell us whether you’d prefer to pay monthly or annually, and we’ll find a car insurance policy tailored to your budget.


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