Compare cheap car insurance

What is car insurance?

In the UK, you can’t legally drive without having at least third party car insurance. This pays out if you damage someone else’s car or injure someone in an accident that was your fault. There are two higher levels of cover: third party, fire and theft and comprehensive.

Contrary to what you might expect, comprehensive can be the cheapest of the three. That’s because drivers who get third party tend to be more risky, which pushes up the premium. We’ve set out in detail what you get and don’t get with each type of cover below. When you’ve decided what type is right for you, compare policies of that type in our table.

What are the different levels of cover?

• Comprehensive
• Third party, fire and theft
• Third party

How to compare car insurance

1. Shop around every year. Many customers have been hit with a “loyalty penalty” for just letting their policy renew with the same provider. The Financial Conduct Authority, the UK finance watchdog, wants to change the rules to stop insurers charging long-standing customers extra. Switching is likely to get you big savings. And always check your existing policy has the right level of cover before you start comparing.
2. Use autofill to save time.You can turn this on with most web browsers. If you want to review your quotes, or make small changes to your form, you can also do so by accessing the Finder quote email and clicking “Edit quote details”.
3. Get your details right. The cost of cover is influenced by your age, location, occupation and marital status, among other factors. Changing one minor detail when completing your application form can have a big impact on the quotes you receive. Make sure all your personal details and information are correct to ensure you’re getting accurate quotes. If your job can legitimately be described in different ways, it’s worth checking all variations.
4. Compare the benefits as well as the price. Policies have subtle differences so when you get your quotes through, it’s worth looking at the details. You can get cheap car insurance that has good benefits.

Case study: Juliet saved £40 just by calling her insurer

Juliet Harris

Hastings

I've been with Direct Line for nearly a decade, but when I was offered a renewal quote via post I called them and asked if they were able to improve on that as I was considering leaving. They reduced the quote by around £40. I would say it's always sensible to phone the insurer directly if you are renewing rather than just relying on the automatically issued renewal quote. Also, always check that the information you are providing is up to date, especially the estimated mileage - a lower mileage could also mean a reduced quote.

What is the average cost of car insurance in the UK?

The cost of motor insurance hit a four-year low in 2020, according to the Association of British Insurers, which has a premium tracker. The average price for a comprehensive policy was £465 (1% lower than in 2019), and in the final three months of 2020, it was £468 – reflecting a “seasonal trend” of rising prices in winter, but still down 3% on the same period in 2019.

These lower premiums reflect the changes in drivers’ behaviour during the pandemic, since many more people have been working from home and not commuting, for example.

What information will I need to give to get a quote?

• Drivers’ details, such as name, date of birth and address.
• Driving record, such as your claims history.
• Details of the car and where it will be kept.

What types of vehicle can I insure?

You can insure vans, motorbikes, trucks and just about any type of specialist car including classic cars. You can also get cover for mopeds and scooters. As yet, you can’t legally drive e-scooters on public roads unless they’re rented, so you’re unlikely to find insurance for them.

What type of car insurance do I need?

The first question to decide is whether you want third party, third party, fire and theft, or comprehensive – and that will partly be influenced by how cheap your quotes are.

Drivers who are very young, very old or inexperienced are likely to see high premiums because of the risk profile of people in those groups. To help you get the cheapest deal, we’ve created specialist guides for learner drivers, young drivers, older drivers, convicted drivers and drivers with bad credit (your credit status comes into play if you want to pay monthly).

What other types of cover can I get?

You might only be using your car once a month, or for only a few short journeys. If that’s the case, consider temporary car insurance and pay-as-you-go insurance.

If you’re a good driver but in a risky age bracket, such as the under-25s, black box car insurance (also known as telematics) can lower your premium. It involves the insurer tracking your driving behaviour, such as your speed and braking.

If you have more than one car in your household, a multi-car insurance deal could get you a discount.

For those who need to use their car for business trips from time to time, there’s temporary business car insurance.

Which policy extras can I get with my car insurance?

• Breakdown cover. If you break down the provider will send someone out to you to try to fix your car or tow it to a garage. Some car insurance includes this.
• Courtesy car/hire car cover. If your car is being repaired or has been written off after a claim, this cover provides a hire car vehicle until you have your own again. Some policies include it (you can filter for them in our table).
• Legal expenses cover. This covers the legal costs of taking someone to court to reclaim costs arising from an accident that insurance hasn’t covered.
• Cover for driving abroad. All UK policies give third party cover for driving in the EU, according to the government website. But if you want a higher level of cover, you can usually add it.
• Windscreen cover. Replacing a windscreen typically costs between £200 and £400, so it’s worth considering this as an extra with your policy. Although it’s included in many comprehensive policies, you’d still have to pay the excess if you claimed, unless you had this extra cover.
• Personal accident cover. This pays out for medical treatment and lost income if you or your partner is seriously injured in an accident.
• Replacement key cover. If your keys are lost or stolen, this covers the cost of replacement.
• Protected no claim bonus. If you claim, your no claim bonus would stay intact. You typically need at least three years of not claiming to qualify for this.

Optional extras to add to your car insurance policy.

Things that could invalidate your insurance policy

These are some of the ways you can invalidate your cover:

• You knowingly deceive your insurer.
• You change the use of your car from its original use. For example, changing from social, domestic and pleasure to business use.
• Your car is being driven by an unnamed driver on your policy or by a person that does not have a valid driving licence.
• You use your car at rallies, races or competitions.
• You are paid to carry passengers.
• You fail to pay for your premium.
• You change your car during the policy term to a car that the insurer cannot cover.
• You do not provide the correct documents to support your application.

Check your policy for further details to confirm your cover is valid.

Stickers, pets roaming free and charging for a lift are just some of the things that can invalidate your car insurance

Discover 9 surprising things that could invalidate your car insurance and how to avoid this happening

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Frequently asked questions

Purchasing your policy

• Do I actually need car insurance?

  Yes, you are legally required to have at least third party cover in order to drive on UK roads. Driving without insurance will likely end up with you facing fines, driving bans and other legal issues. You would also be liable for any damage or injury caused if you are involved in an accident.

• How much does car insurance cost?

  The average cost of car insurance in the UK is around £840. However, the cost of your insurance is determined by a range of factors, and you may end up paying more or less than this amount. Younger drivers, as well as those living in London, will generally pay more for their car insurance than average.

• When is the best time to get car insurance?

  The best time to buy car insurance is approximately three weeks before the start date of your policy. Buying car insurance on the day you need it can end up costing you hundreds of pounds.

• How long do I need car insurance for?

  You’ll need car insurance for as long as you want to drive your car in the UK. If you only plan on driving for a short period of time, you can get temporary car insurance.

• How often do I need to pay car insurance?

  You can generally pay your car insurance on a monthly or yearly basis, although it is generally cheaper to pay for your policy annually. While paying a monthly premium may seem like a better option, you will often be paying interest on your premium, which means it will be more expensive overall.

Choosing the right option

• Should I get comprehensive car insurance?

  If you want the highest level of cover and want to protect your car in the case of an accident, it’s worth considering comprehensive car insurance. While you are only required to get third party insurance to drive in the UK, comprehensive cover offers greater peace of mind.

• Can I get car insurance with bad credit?

  Yes, you’re perfectly fine to get car insurance even if you have bad credit and it’s a legal requirement to have car insurance to drive in the UK. However, if you have a poor credit score, you may be charged more for cover if you choose to pay your insurance premium in monthly instalments.

• What is the cheapest car insurance?

  Third party cover is the cheapest level of car insurance and is the minimum level of cover required to drive in the UK. It only covers you against any damage or injury sustained in an accident where you’re at fault and does not protect your car against damage.

• Which is the best car insurance?

  This will depend on a number of factors including your age, budget and driving experience, as well as the type of cover you need. You can compare a range of the best car insurance companies here.

• I'm a young driver, what car insurance should I get?

  Unfortunately, car insurance for young and new drivers is generally more expensive than it is for other types of drivers. However, you can help reduce the cost of your premium by considering telematics insurance, which measures your driving performance and can help save you money, provided you are a good driver.

Adjusting your policy

• Do I need to change insurance if I get a new car?

  If you’ve just bought a new car, you can generally transfer your existing car insurance policy over to the new vehicle. However, you will need to inform your insurance provider, as they will need to change the terms of your cover. You may also need to pay an administration fee to transfer your policy, and your premium may change depending on what type of car you are buying.

• Can I change my level of car insurance cover?

  This will depend on your provider, but you may generally be able to change or upgrade your level of cover.

• When can I cancel my car insurance?

  You are free to cancel your car insurance at any time, but may pay a fee to do so. This may be because you’ve found a more competitive policy elsewhere, or simply no longer need car insurance. Keep in mind that it’s illegal to drive without car insurance, so if you’re cancelling your policy, you’ll need to start a new policy if you still plan on driving.

Making a claim

• How do I know who's at fault in an accident?

  When you have an accident, the driver who is considered at fault is responsible for covering the cost of the damage. This means it will be their insurer that covers the cost of any damage to the other party. There are general rules of thumb about who is responsible, but this is not always the case. The driver who hits another from behind is generally at fault, as is one taking a left turn that leads to an accident.

  Even if you don’t believe you are at fault, you will still need to report the accident to your insurer. Ultimately, it is up to both your insurer and the other driver’s insurer to determine who is responsible for covering the damage. You can find more information on car accidents here.

• How can I claim if I've had an accident?

  If you’ve been involved in an accident, you might decide to make a claim. To increase the likelihood of the process going smoothly, keep the following tips in mind:

  • At the scene of the accident. Don’t admit that you were to blame. You should make a note of the names, contact information and registration numbers of the other people involved in the accident. You should also get hold of and record the number of the police report, if it applies.
  • Before you make the claim. Consider all the consequences that might arise as a result of making a claim. You should also make sure that you’re fully aware of any excess obligations you might have and accept that you could be losing your no-claim bonus.
  • Making a claim. You must give the insurance company complete and accurate information surrounding your accident as clearly and as quickly as possible.
  • Fill out a formal claim form if necessary. If available, provide as many supporting documents as possible and make sure that the insurance company acknowledges that your claim was received. Next, you’ll have to answer any questions that are relevant for the assessment of your claim and, to ensure everything goes smoothly and you get an answer as quickly as possible, make sure you stay up to date with how your claim is progressing.

• When should I claim on my car insurance?

  It’s not always a good idea to make a claim on your car insurance. If may not be worth claiming if your car has suffered minor damage as a result of your own driving, or even if you were involved in an accident and the other driver was at fault. When you make a claim, you will have to pay your excess and will lose your no-claim bonus. Your premium may also be increased, even if you are deemed not to be at fault.

  If the value of the claim is for less than your excess, your provider will also not pay out on the claim. However, you should still report any accident to your insurer, even if you don’t intend to claim.

Changing lanes: Car insurance for the new era

Finder published a paper in November 2020 on how the pandemic has exposed the flaws in traditional car insurance, and how it needs to change to overcome the challenges of the future. Our paper includes original research, contributions and predictions from experts including James Blackham, By Miles CEO; Freddy Macnamara, Cuvva CEO; and Martin Friel, insurance journalist and communications adviser.

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