Shop around
Drivers with lower insurance bills tend to be 'rate chasers' - these are people who shop around and switch insurers every year. Research shows it is usually expensive to stick with the same insurer for more than 12 months because there are always new players prepared to offer loss leading rates to attract new customers. Mike Naylor, senior researcher at the Consumers' Association, says an average saving of between £100 and £150 can be made by those who shop around for the best deal.
"Premiums tend to increase on an annual basis, so it's worth switching to a new insurer every year to cut your premiums," he advises. "Make sure you get the right level of cover for your money, too."
Increase excess
Agreeing to pay more towards the cost of any accident repairs will bring down premiums. For instance if you agree to pay the first £500 rather than the first £100 of every claim, your premium should fall dramatically.
Remove other named drivers
Remove other named drivers, particularly children away at university, from your policy. Many insurers allow you to add temporary named drivers for short periods. It may be convenient if your children can drive your car in emergencies, but it is expensive. A small number of older drivers on a policy will cost less.
Reduce mileage
Insurers use mileage to calculate premiums so driving less each year will bring down premiums. For example, a reduction in annual mileage of 5,000 miles could save a typical 35-year-old female driver about £50 a year in premiums. A cut of 10,000 miles a year could save more than £100.
Consider downgrading
You should consider whether you really need extras on expensive policies, such as free courtesy cars after accidents. A no-frills policy should be cheaper.
Secure your vehicle
Enhancing the security of your vehicle by installing security such as tracker systems can reduce premiums. Also try and park your vehicle off road overnight. Most insurers give a discount for cars garaged overnight.
Join the Pass Plus scheme
One way to reduce the cost of cover is by taking the Pass Plus qualification. Several insurers offer discounts of about 30 per cent for drivers who successfully complete Pass Plus.
Protect your no-claims bonus
A no-claims bonus allows you to reduce insurance costs by as much as 60 per cent, so it's worth protecting if you do need to make a claim. Most insurers will charge between 10 and 20% of your reduced premium to do this; you can then typically make a claim once a year, up to a maximum of two claims in three consecutive years, without your no-claims discount being affected.
Try and avoid monthly payments
Most insurers allow customers to pay monthly for their insurance, but charge annual rates of up to 30% for those who take this option.
Buy Online
Many insurers offer discounts for policies bought online, so it makes sense to buy your insurance via the insurers website.
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