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How to get cheap car insurance in Ireland?

Date Published 05.12.2018
Topic Car Insurance

How to get cheap car insurance in Ireland | AIG Ireland

There is much discussion in the media and online around what impacts the affordability of car insurance in Ireland.

We want to answer this question by amalgamating our knowledge of what drives cheap car insurance quotes into one ultimate guide that you can use to:

·         Understand what may be impacting the cost of your premium.

·         Inform decisions you make in future.

·         Become aware of external factors that influence car insurance premiums in Ireland.

Use the outline below as guide on the below and how far to scroll:

  • What do car insurance companies consider when pricing policies?
  • How to lower your car insurance premium?
    • Check your car’s insurance group before you buy
    • Value your car accurately
    • Drive less
    • Get as much experience as possible
    • Protect your no claims discount
    • Follow the rules of the road
    • Take the SmartLane challenge
      • How does SmartLane help reduce your premium?
  • Why do some people get cheaper car insurance?
    • Cheaper car insurance for young drivers
    • Car insurance for women
  • External factors impacting car insurance policies in Ireland

 

What do car insurance companies consider when pricing policies? 

Insurance companies take a wide range of factors into consideration when pricing premiums. Some of the most common are:

Horsepower of your car

The horsepower of your car will affect your insurance premium. Someone with a lower engine size will receive a cheaper car insurance quote than someone driving a more powerful car. This is something worth considering if you are changing your car soon. Do you need a 2.0 litre engine or would a 1.6 suffice? This will very much depend on how far and often you need to drive. If you do a lot of long distance driving on motorways, then a 2.0 litre engine may make sense for you. If you are a city driver, consider a smaller engine size, that should be more efficient on short journeys around town.

 

Your age

Not something we can control but the age of a driver is usually taken into consideration when pricing a premium. Inexperience and over exuberance make younger drivers a greater risk to insurance companies. Statistics from the Road Safety Authority show most drivers killed in road traffic accidents in 2017 were between the ages of 16 and 25[1]. As you become a more experienced driver you should benefit from a reduced premium. In the meantime, check out our BoxClever option for telematics.

 

How your car is used? 

The more you use your car, the greater your risk of having an accident. Premiums for drivers who use their car to get to work are generally higher. If you want to knock some money off your premium, can you use public transport, cycle or even walk to work?

 

Where is your car parked? 

The location of your car when it isn’t being used could save you money. Most car insurance companies want to know your car is as secure as possible when it isn’t being driven. Preferred locations include, a driveway in front of your home or in a secure underground car park. If you must park on-street or away from your home, it may cost you more to insure your car.

What do car insurance companies consider when pricing policies?

Your address

Where you live is another element that is taken into consideration when pricing car insurance. Usually urban addresses are more expensive than rural, on the basis that there is a higher risk of crime or damage to your vehicle. However, this isn’t always the case; some rural counties have higher claim rates than their urban counterparts so having an address in one of those counties might be impacting your car insurance premium too.

Your level of cover

There are two levels of car insurance covers :

·         Comprehensive car insurance

·         Third party fire and theft policy

In Ireland, you are only legally required to have third party fire and theft insurance. This covers another driver’s car in an accident where you are at fault. This insurance will also cover your vehicle for theft or fire.

Comprehensive cover will also cover the cost of accidental damage to your car. Although the premium is likely to be more expensive, fully comprehensive car insurance can save you money in the long run if your car is badly damaged in an accident.

The amount of excess

Car insurance excess is an amount you pay before your car insurance covers a claim. This amount can vary. The higher it is, the less your premium will cost on an annual basis. Accepting a higher excess is a way to reduce your premium but, be aware, you must be able to pay this amount yourself, if you claim on your policy.

How to lower your car insurance premium

How to lower your car insurance premium

Not all the factors that impact your car insurance premium are going to be within your control but some are:

 

1. Check your car’s insurance group before you buy

Most car insurers put cars into one of 50 insurance groups which impacts the premium for each vehicle. If you have your eye on a make and model of car but want to keep your insurance reasonable, check which of the insurance groups it belongs to.

Tip: the smaller the engine, the less expensive your premium is going to be.

 

2. Value your car accurately

When filling out your renewal form, ensure you value your car accurately. Remember the question is asking for the value of your car today, not how much you paid when you bought it. Use a depreciation calculator to estimate the current value of your car.  

3. Drive less

Taking public transport, cycling or walking to the office may save you some money on your car insurance and it has the bonus of improving your overall health and fitness. A UK study showed driving 10 or more miles a day increases anxiety and cholesterol [2]. Don’t arrive at the office stressed, use public transport and watch the world go by.

 

4. Get as much experience as possible

Key to becoming a great driver is getting as much experience as possible behind the wheel. Although every learner driver must take a minimum of 12 lessons, take more if you can afford to. Practice driving with a fully licenced driver as you can.  Some insurance companies will count time spent as a named driver when calculating your no claims bonus.

 

5. Protect your no claims discount

This is a discount you will receive from your insurance company for not claiming on your policy in the previous year. Consider step-back no-claims protection when taking out car insurance so you don’t lose all of your discount if you need to make a claim.

6. Follow the rules of the road

For your own safety and the safety of other drivers, stay below the speed limit, don’t ‘amber gamble’ and remember to indicate when and where appropriate. Along with following the many other rules of the road.

If you need a refresher, you can download the rules of the road for Ireland from the Road Safety Authority.  

7. Take the SmartLane challenge. 

If you want help following the rules of the road and to make savings on your premium, take AIG’s new SmartLane challenge. You don’t have to be an AIG customer to take this challenge, it’s open to everyone!

 

How does SmartLane help reduce your premium? 

SmartLane provides real-time feedback and rates your driving out of 100. The higher your score, the better you drive.

The highest score will get up to 20% off an AIG insurance policy. So why not download the free SmartLane app today and give it a go?

Encourage friends and family to download it too and finally answer that age-old question; who is the best driver?

Why do some people get cheaper car insurance? 

Ever been talking to friends, wondering how they manage to get such a good deal on car insurance? Here are some of the most likely reasons:

Multiple policies with one insurer

Larger insurers that offer multiple insurance products sometimes offer discounts if you hold more than one policy with them. For example, if you have home insurance and travel insurance with the same company, they may offer a discount if you take out a car insurance policy with them too.

 

Third party

The level of cover may be different, as mentioned earlier third party fire and theft is usually cheaper but it is not as inclusive as comprehensive insurance.

 

Brokers

Some people get a good deal on car insurance using a broker but there are things to watch out for with this:

1.  You are a client of the broker and not of the insurance company itself. Claims must be made through your broker, who may not have the capacity to handle them in the same way an insurance company can.

2.  There have been several arrests for fraudulent car insurance sold to unsuspecting people by unauthorised brokers in Ireland this year. The consumers who purchased counterfeit policies are not actually insured and could face prosecution or have their car seized by the Gardaí.     

 

If you are going through a broker, check the claims process and always verify their identity. 

Cheaper car insurance for young drivers

Getting cheap car insurance as a young driver is difficult, there is no doubt, but there are things you can do to keep your premium as low as possible:

Become a named driver

Although taking out your own policy may be financially out of reach, see if you can be added as a named driver on a parent or siblings car. Some insurers, incuding  AIG, will count named driving experience towards a no claims bonus when you take out a policy in your own name.             

AIG BoxClever

Check out AIG BoxClever, our affordable car insurance for younger drivers. If you are under 27 you could get big policy discounts for installing a telematics box in your car that tracks how you drive. The safer you drive, the more rewards you will receive. Find out more about how you can save with AIG BoxClever.

Car insurance for women

There was a time when women were considered safer drivers by some car insurers and offered more affordable premiums. However, in December 2012, the European Court of Justice ruled that discrimination based on gender was incompatible with gender equality legislation. Since then insurers cannot use gender as a basis for offering a lower premium.

 

External factors impacting car insurance policies in Ireland

Unfortunately, there are some reasons that car insurance is more expensive in Ireland that we, as consumers cannot control:

 

1. High award levels 

We have the highest claim award levels in Europe. As an example, the average whiplash award in Ireland is €15,000 compared to €3,000 in Spain or Italy. This difference will directly affect your insurance premium. The possibility of landing a large amount of cash encourages people to overstate or fake claims. Insurance fraud costs the insurance industry over €100m a year and this impacts your premium.

 

2. The book of quantum 

Although it sounds like it, this is not a book of spells from Harry Potter! It is a book guiding how much should be awarded in compensation. The problem in Ireland is the book of quantum is out of date and is rarely used by courts in Ireland. As there isn’t a clear outline for awards, it is up to the judge to decide, so payments can vary a lot. When we include high legal fees, costs can be huge.

3. Legal fees 

One of the recommendations of the Troika committee, in the dark days of the recession, was to cut legal fees, this has not happened in Ireland’s courts. Until it does, we believe giving the Injuries Board greater power to deal with personal injury cases will help. The Injuries Board was set up so people attending did not need to bring a solicitor. Now, almost everyone going to the Injuries Board (90%) brings one and 40% of cases are sent on to court. The Injuries Board needs to go back to basics so people feel happy to attend without a solicitor.

This is not right or fair on the consumer. Here are 3 things AIG are doing, on your behalf, to change the insurance market and, in time, reduce the amount you pay for your insurance:

 

Lobbying the government

AIG General Manager and Head of global consumer have both petitioned the Irish government regarding high award levels to encourage change.

No tolerance of insurance fraud

We’ve adopted a zero-tolerance approach to insurance fraud. We have lots more people spotting, stopping and examining false claims. Our work with An Garda Síochána has resulted in a number of people who made false claims being convicted and sentenced to prison.

 

Sensible Trading

AIG have and will always be sensible when it comes to guaranteeing payment and pricing, so we are here to protect you when you need us most.

 

We hope you have found this guide useful. If you have any questions about affordable car insurance, please get in touch. We will do our best to answer them.

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[1] http://www.rsa.ie/Documents/Fatal%20Collision%20Stats/Provisional_Reviews_of_Fatal_Collisions/RSA%20Provisional%20Review%20of%20Fatalities%2031%20December%202017.pdf

[2] http://uk.businessinsider.com/public-transportation-commuting-health-driving-2015-2?r=US&IR=T

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