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The car insurance companies are discounting their premiums more than usual because of the increased competition, so grab a bargain. There are fewer car sales than usual so the insurers are competing with each other to get our business. See below for tips on how to get the best deals.

• Shop around for the cheapest and best motor insurance.
• Get a 20% online discount when you get insurance from Kwik Fit. Plus, for every friend you refer you’ll receive £40.
• Got at least four years no claims on your existing policy? Well if you’re a new customer purchasing online you can get 15 weeks’ worth of car insurance absolutely free from Aviva!
• Get £25 cashback if you switch through Money Expert.

Top car insurance picks

Get £25 cashback with car insurance

Price comparison service MoneyExpert.com is currently offering insurance shoppers cashback of up to £25 per policy.

All you have to do is go through MoneyExpert.com to find the best policy for you. Once you have the policy in place wait for 14 days (from the policy start date) then go back to MoneyExpert.com and complete this Cash Back Application Form. Be warned though – applications made after30 days from the policy start date will not be accepted.

MoneyExpert.com promises to credit your bank account with the cashback within 60 days of the application. Even better, the cashback is offered across all quotes, not just specific deals, so you can pick the best policy for you.

On top of all that, if you’re able to find a better deal somewhere else online, MoneyExpert.com will refund 110% of the difference.

How to choose

Getting motor insurance is a legal requirement if you have a car or other motor vehicle. The good news is that there’s a lot of competition between insurers in the car market, so by shopping around, you should be able to get a good deal.

Choosing the right car insurance is about deciding what kind of cover you want and then shopping around for the best price you can get for that policy. So…

Step 1: Decide what cover you need

With insurance, cheapest is not always the best. Read the policy carefully to make sure you have cover for all eventualities. Look at the excesses and exclusions carefully. A cheaper policy could be hiding a high excess and limited cover.

Also, some insurers no longer include ‘Driving Others Cars’ as standard, while others don’t include a courtesy car.

And if you regularly drive abroad, check the European cover limit. Some car insurance polices include this cover as standard, others may charge you extra for it.

There are three basic types of motor insurance:

• Third party fire and theft (TPFT): This covers you if claims are made against you for damage or injury to other cars or people. It also covers you if your car is damaged (or you are injured) by fire – or if your car is stolen.
• Fully Comprehensive: This is the same as TPFT and then some. This covers any medical expenses, personal belongings and personal accident cover.
• Third party only: This only covers any claims made against you by other people.

The type of insurance you go for will depend on how flush you are feeling, what state your car is in, and how nervous you feel about paying if you do have a bump.

Third Party is not always cheaper than Fully Comprehensive. This is most often the case for the young and male. The insurance companies make the assumption, no doubt backed up by statistics, that customers who don’t value their cars will be more reckless and therefore more likely to crash into something expensive. Do a comparison check before choosing third party to make sure you are not paying more for less.

Whatever type you go for, though, make sure you don’t pay any more than you need for it.

Step 2: Shop around

Shop around on the net and save yourself a load of cash. Our car insurance comparison site powered by our friends at Confused.com will get you a good cheap deal – we know, we’ve tried it.

But don’t just try that see how comparison sites comparethemarket.com, Gocompare or Money Supermarket compare. Be Wiser Car Insurance is another comparison site, all policies come with free RAC breakdown service and free legal protection.

Kwik Fit is a great place to get car insurance; in fact, according to Consumer Intelligence, it was the best place to find car insurance in 2007. If you take out a car insurance policy with Kwik Fit you’re entitled to a 20% online discount. The Kwik Fit website has more details.

Aviva aren’t included on the comparison websites – but they are definitely worth checking out if you’ve got at least four years no claims discount on your existing policy. As well as the four year no claims, if you’re a new customer and you register with them online, you can qualify for 15 weeks’ car insurance absolutely free!

Tesco claim that Clubcard holders could save up to 20% online with Tesco Car Insurance.

Remember, you’re likely to get the best rates if you apply online. Internet sales have fewer overheads so companies can pass on savings to the buyers.

Step 3: Keep the costs down

There are some things you can do before and after choosing your policy to keep the costs down annually.

Put women on your insurance as second drivers. This makes a surprisingly large difference especially if you are young and male. Ideally the women should have being driving for a while and have a clean licence and driving-history. One of our Moneymagpies, a young man, saved over £100 with this little trick.

Keep a safe driving track record. You can often get a discount on your premium if you take advanced driving qualifications. You will genuinely be safer on the roads too.

Buy smaller, greener, cheaper. The size, age, value and make of a car are all important factors that could cut your insurance rates.

For example, having heat-resistant doors on your car could lower your premiums.  Investing in a cheaper and smaller car initially can also help bring costs down. Choose cars that run on electricity and gas and save some money and the environment at the same time.

Pay in full. Instead of monthly premiums, pay your premiums six-monthly or annually to avoid paying high rates of interest.

Keep good credit records. Protect your credit rating – your insurance cost could depend on it. Essentially, the cleaner your record, the less insurance you’ll have to pay.

Check and update your credit record regularly, and rectify any errors promptly so your record remains accurate.

Ensure good maintenance and planning. Be aware of road rules and drive carefully to avoid accidents. Be mindful of where you park the car and don’t keep your valuables in the car to avoid potential damage and theft.

And security measures – such as installing approved alarms – may lower the insurance premiums.

Pay higher ‘deductibles’. By requesting higher deductibles (the amount you are willing to cover yourself in the event of an accident) in your insurance policy, you can really decrease your monthly costs.

Be particular about your personal details. Insurance companies offer varying car insurance rates depending on age, sex or professional status.

Statistically, women are proven to be safer drivers than men. So for a family car, consider having the wife’s name on the policy instead of the husband’s.

Similarly, younger drivers are known to be more reckless, so arrange to buy a policy after your birthday to add that extra year on.

In fact, certain professional fields bring with them higher premiums than others, so be careful how you describe your work. If you do different things, pick the least ‘racy’ one.

And remember, too, that students can often get discounts – so don’t forget to mention if you are one.

Take advantage of Tesco Bank Value Car Insurance. Tesco Value cover is a comprehensive insurance policy with some of the ‘frills’ taken out – great if you want to keep the cost of your car insurance down.

It’s a bit cheaper because it doesn’t include windscreen or stereo cover.

Getting started

• Check out Confused.com
• Also try Kwik Fit for top motor insurance deals and a 20% online discount.
• Money Expert also compare the leading insurance brokers and give you £25 cashback if you switch through them
• Tesco Car Insurance