Martin Lewis: Do you research and drive down the heavy cost of car insurance

So to help you drive down costs, let me answer your most common questions…

Is this only something you can do if you’re at renewal?

No, everyone should be checking their price right now, even if you only signed up to a new deal a few months ago. Unless you’ve claimed, you can usually cancel a policy for a fee of around £50 and get a refund for the rest of the year (though you won’t earn no claims for that year). It’s worth checking if it’s worth it.

My renewal is only six weeks away, should I just wait?

It’s likely if you did try and cancel and get a new policy now, the cancellation fee will diminish any savings – so that’s a bit futile.

Yet there is another trick – www.aviva.co.uk, www.postoffice.co.uk and www.lv.com quotes last 60 days, so why not grab them now and you’re effectively locking in those prices in case they rise in the meantime.

Are the savings that great? Can’t you just auto-renew?

Never just auto-renew without checking elsewhere, often it just lets insurers smack a price rise on you, as it knows apathy means many will keep paying more and more.

Zipman23 got in contact with me to demonstrate just that: “I hadn’t had any accidents or incidents yet my renewal went up almost £200. I left and went elsewhere for £70 less, plus £60 cashback.” And some save far more – I’ve heard savings getting close to £1,000.

I’m not saying auto-renewing will never be your cheapest option, just that it should never be done without checking and comparing elsewhere first.

So it’s just a question of getting on a comparison site?

That’s the route many use, but there are steps to really kick it up. It’s important to understand that there’s no one cheapest provider, so it’s a case of following a system.

Never just do one comparison, you need a benchmark of a few comparisons to find out where’s cheapest. There’s a system to follow fully explained at www.mse.me/carinsurance. In a nutshell…

Combine comparison sites. They don’t all cover the same insurers, so combining a number of sites is the best way to really make a meaningful saving. My current top picks for a typical driver are www.moneysupermarket.com, www.confused.com, and www.comparethemarket.com.

Check insurers that comparisons miss. Comparison sites let you compare hundreds of insurers quickly but they don’t capture the entire market. The biggies, including Aviva, www.directline.com and www.zurich.co.uk only offer their products directly.

More than one car at home? Comparison sites can only cope with one car at once so don’t include multi-car discounts. Therefore you should always manually check those that offer it.

The big one is www.admiral.com multi-car, but www.churchill.com, www.directline.com and www.privilege.com also offer it. I’m not saying they’ll win, but that you should check.

Difficult to insure? Use a broker. If you’ve difficult circumstances (eg, past bans or big accidents) that make getting insurance difficult, a comparison site is less likely to help as these are mainly focused on ‘normal’ policies.

You may be better off finding a local broker – see the British Insurance Brokers’ Association website (www.biba.org.uk), as these can sometimes find a cheaper deal for you.

So it’s all pretty straightforward?

Ah if only. Common-sense doesn’t always do the job… Third party’s not always cheapest. Merely selecting comprehensive makes some insurers see you as a lower risk. So always check both.

Adding a responsible second driver can cut your costs. This can bring down your risk average and price. Of course, it must be someone who may drive your car. As Mazzyb5 tweeted: “Took your advice and added mum, saved £500.”

Tweaking your job description can cut costs. I’m not saying lap dancers should call themselves cabinet ministers (or vice versa, heaven forbid). But these days many people have such specific job descriptions car insurers don’t list them, as Fabsternation tweeted: “Thanks. Changing from creative director to marketing manager saved £300.” See my fun car insurance job picker tool www.mse.me/jobpicker.

Beware paying monthly. A monthly payment plan for your insurance is essentially a high-interest loan. For example, if your premium is £1,000 but you’re paying an APR of 25 per cent, your insurance will actually cost £1,140 once you factor in the interest.

So either pay in full, or if you can’t afford it, use a credit card with a lower APR or better still, a 0 per cent credit card for spending, ensuring your repayments are big enough to clear it within a year.

And any special tips for young drivers?

With the average premium for a 17 to 22-year-old at an eye-watering £1,194 per year, young car drivers can be priced out – all the techniques above will help, but if you’re not getting there, check ‘pay how you drive’ (telematics) this involves a device being fitted inside your car that monitors your actions behind the wheel.

Full info in www.mse.me/youngdrivers.

Martin Lewis is the Founder & Editor in Chief of Money Saving Expert. To join the 10 million people who get his Martin’s Money Tips weekly email, go to www.moneysavingexpert.com/latesttip or watch