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Find out how much you should be paying for car insurance

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Use our handy guide to work out how much you should be paying for your car insurance and why.

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What sort of car insurance ‘risk’ are you?

Ever wondered why everyone pays a different premium for their car insurance? It’s because the amount you are charged for cover is based on a statistical assessment of how much of a risk you pose.

The higher the risk of having your vehicle stolen or being involved in an accident, then the more likely it is your insurer will have to pay out for a claim. Someone with a very expensive or powerful car, for example, will generally pay more than somebody with a cheaper or less powerful car.

Similarly, someone with 20 years of driving experience will tend to pay less than someone who’s just removed their L plates because, statistically, an experienced driver poses a lower risk.

But then these are only rules of thumb, and insurers take several other factors into consideration when setting your motor insurance premiums. So here at MoneySuperMarket, we regularly crunch the numbers behind millions of car insurance quotes to analyse market trends and help you get a solid estimate on your premiums.

What is the cost of car insurance?

According to MoneySuperMarket data (September 2017), the average cost of an annual fully comprehensive car insurance policy is £579. This is an increase of 7% in a year, meaning you will now pay £40 more than a year ago. When you compare this to two years ago, the change is even more significant: the average cost in September 2015 was just £501 and prices have jumped 15.6% (£76) since then.

MoneySuperMarket’s car insurance data monitor analyses the impact of age, gender and location on car insurance premiums to find out how much of a risk different groups are considered to be in an insurer’s viewpoint. 

Why are age and location important when calculating car insurance?

Age and location tend to be among the most influential factors when it comes to calculating car insurance quotes.

Age is a big factor for motor insurance premiums, as older drivers are seen by insurers to be less likely to be involved in accident. Generally speaking, this is because older drivers tend to have more experience behind the wheel, whereas younger drivers tend to have less experience. In fact, younger drivers (17-24) make up 25% of claims involving accidents.

Those living in areas with higher crime rates also tend to pay more for cover. If your postcode is in a high-crime area, insurers will inflate your premiums to account for the added risk of your vehicle being vandalised, damaged or stolen.

How to bring down the cost of car insurance

Bear in mind that our car insurance calculator only gives you the average price you can expect to pay. In reality, your premiums could be higher or lower. If they are higher, there are some steps you can take to help bring the cost down.

1.  Opting for a lower level of cover is not often the best way: Since many young drivers opt for third party only cover, the premiums for this type have increased significantly. Therefore, it may be cheaper and definitely more cost effective to buy fully comprehensive cover. Read more about car insurance policy types.

2.  Pay a higher voluntary excess: Doing so typically earns you a lower premium as the insurer will be left with a smaller bill. However, you must not set your excess at a higher level than you can actually afford, because you will have to pay it in the event of a claim.

3.  Improve your car’s security: Keeping your car parked in a well-lit area or in a driveway overnight and installing insurer-approved security equipment – such as immobilisers or steering wheel locks – reduces the chances of it falling prey to thieves, and insurers should reflect this in their car insurance quotes.

4.  Build your no claims discount: For every year you drive without making a claim you can build up a discount when it comes to renewing your car insurance policy. The range of discounts offered are shown in the table below.


Years without claiming

Discount offered by most insurers












5.  Take a young drivers advanced driving course: Pass Plus is a course that teaches young drivers extra skills outside of the practical and theory test, such as motorway driving. In some cases, it helps young drivers to get cheaper premiums with some insurers. This costs around £35 an hour, on average, throughout the UK.

6.  Add an experienced driver to your policy: In theory, having another driver on the policy reduces the amount of time you’ll spend behind the wheel and could therefore reduce your premiums, if the insurer believes that the named driver is less likely to be involved in an accident. (A word of warning though, you must never have a more experienced driver ‘front’ your policy for you as the main driver to get cheaper cover – this is known as fronting and is illegal. If you’re caught fronting you could end up in court for driving without motor insurance.)

7.  Think about getting telematics car insurance: Telematics or black box car insurance takes data about how you drive and will influence your premiums accordingly. If you can demonstrate you are a safe driver then you could make a significant dent in your insurance premium. 

Our car insurance comparison tool can give you an idea of what you can expect to pay, but follow these steps and you can earn yourself a better deal.

MoneySuperMarket data, all data collected between March and September 2017.

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