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Hints to reduce your premium


Nobody enjoys paying insurance premiums. Most of us see it as a necessary evil, to be dealt with as quickly and cheaply as possible.

At the moment premiums are rising by as much as 25% per year. There are reasons for this (see Insurance News). You can however keep your premiums lower by making sure you are getting all the discounts you are entitled to, whilst still maintaining comprehensive cover.

We will deal with the different types of insurance in turn.

Car Insurance

Restricted Driving

If you can restrict driving to yourself only this can reduce your premium by up to 40% compared to 'unrestricted' driving. Having one other named driver usually qualifies for a 20% discount. Try to avoid 'unrestricted' driving as this is not offered by many insurance companies and therefore competition for your business is not so great.

Restricted mileage

If you do low mileage make sure your insurance company are aware of this. Discounts are given for doing 12,000 miles per year or less. The lower the mileage the greater the discount. Make sure however that you do not exceed the agreed limit as you will be penalised heavily when making a claim.


The discount you receive for car security depends where your car is kept and also the type of security you have. If you are considering having an alarm or immobiliser fitted make sure it is fitted by an approved company. The best types of devices have either a Thatcham 1 or Thatcham 2 security rating. Certain high performance cars are virtually uninsurable without a good quality immobiliser.

Use of the car

If your car is only used for 'Social Domestic & Pleasure' (SD&P) purposes make sure you tell your insurance company. Excluding all business use usually results in a lower premium. Be careful if you use the car to commute to work, as some companies exclude this from their SD&P rates.

Claims Excess

With Comprehensive cover it is usual to have a £100 Accidental Damage excess. This means that you will have to pay the first £100 of any claim for accidental damage to your car. If the claim was someone else's fault it may be possible to recover this. If you opt to have a larger claim excess this can help to reduce your premium. A claim excess of £250 can reduce your premium by 10%.

House Insurance


Having good quality door and window locks can help to reduce your premium. In some areas of the country good security is needed before an insurance company is prepared to cover you. External door locks should be to BS3621 standard and have the kite mark to prove it. Window locks must have removable keys. Insurance companies have different criteria so make sure you qualify by reading through the details carefully. Failure to meet the standard could result in a claim being refused.

Having an approved alarm fitted with an annual maintenance agreement can also reduce your costs. Although you should make sure your door and window locks are to standard before investing in an alarm.

Membership of an approved Neighbourhood Watch scheme is recognised by many insurance companies.

The fitting of smoke alarms does not often produce a reduced premium, although they should be fitted for your own safety.

Combined Policies

As a general rule if you combine your buildings and contents cover with one company you will receive a discount from them. You must check however that the company you are with is competitive for both types of cover. Sometimes it is better to arrange separate cover to obtain the best rate on both the buildings and contents.

Claims Excess

Most policies have a £50 claim excess, increasing to £1,000 for subsidence. If you opt to increase the £50 excess then this can reduce the premium you pay. The discount for a £250 excess is often 10%.

Travel Cover

Exclude Baggage

The baggage cover under a travel policy is usually quite limited. It is better to have your belongings covered under your home contents policy. Removing baggage from a travel policy will normally result in a discount of approximately 15%.