When it comes to van insurance, the costs vary from person to person. From factors such as your age and the van you drive, to the crime rates in the area you live, there are numerous ways the insurance company works out your yearly or monthly bill.
Whatever your age or driving experience there are ways to slash costs on your van insurance. Read on to find out more.
What affects the cost of van insurance?
When it comes to working out your premium insurance companies don’t just pull a number out of a hat. While it may seem this way sometimes, they draw together several factors and look at the type of policy you want, before presenting you with a figure. Below are the main reasons behind how your insurance is priced.
Van size. Smaller vans with less powerful engines are typically cheaper to insure, while larger models are often put in the higher insurance groupings.
Level of cover. The received wisdom is a comprehensive policy will be more expensive than third party or third party, fire and theft. However, this is not always the case as insurers have realised riskier drivers take out cheaper, third party policies, so shop around.
Van use. You need to specify to the insurer whether you will use the van commercially and how. While it might be more expensive getting a business policy, at least you’ll be properly covered. If you carry other peoples’ goods for instance, it’s vital your load is protected.
Employment. What job you do can impact your insurance costs, with an insurer potentially offering you a better rate if it knows you won’t be commuting during the morning rush hour in your van.
Where you live. From how busy your local roads are to the levels of crime in your area, location plays a key part in driving up or pushing down insurance premiums.
Security. Parking your van in a garage or secure lock-up, or putting extra security features on it like a tracker can convince the insurer your van is less of a risk, in return you could pay less on your premium.
Payment. People who pay for van insurance in monthly instalments end up shelling out more, as their premiums are typically more expensive and they have to pay interest.
How can I lower my van insurance rates?
Voluntary excess. Your excess is the amount you have to pay for a claim before the insurance money kicks in. By choosing to pay a higher excess your premium will fall. However, make sure you can afford to pay should you have to make a claim.
Limit mileage. Keeping your mileage down and showing the numbers to your insurer can lead to reductions in your premium. After all, the less time you’re on the road, the less chance you have of making a claim.
No claims bonus. Drive responsibly and avoid making a claim and after about five years you’ll get a pretty decent no claims bonus.
Pay annually. By paying for your insurance in a lump sum at the start of the agreement you get a better premium rate than if you paid for your policy in monthly instalments. With these gradual payments you get charged interest too.
Shop around. As ever, compare exhaustively. Use price comparison websites and get a few quotes directly from insurers too, so you can work which provider offers the best deal for you.
Additional drivers. Avoid having anyone who is young and inexperienced as a named driver on your policy, as this will bump your premiums up drastically.
When it makes sense to buy the cheapest van insurance
The main reason you would buy the cheapest van insurance on the market is if it’s the only policy you can afford. Yet, even if you can splash out a bit you might still go for the lowest price possible.
Why? Well if you have an old banger of a van which isn’t worth much, there’s not much point getting a fully comprehensive policy.
As long as you can get the coverage you need for your business, for your tools or goods for instance, then you could well take out the cheapest deal possible. If you need your insurance for a short amount of time then getting a cut-rate policy might be best too.
How do young drivers get cheap van insurance?
If you’re under 25 getting van insurance can seem outrageously expensive. Unfortunately, young drivers are seen as higher risks on the road and are hit with higher fees. Yet there are ways to lower the costs.
You can follow the tips described earlier in the article, such as paying annually instead of monthly, paying a higher voluntary excess or limiting your mileage.
You could also look at taking out a van black box policy. This is when you agree to put a black box in your vehicle which measures your braking, your cornering, how fast you drive, how much you drive and at what time of day or night you’re on the roads.
Drive responsibly and this could cut your insurance premiums, as it proves to the insurer you drive carefully. Should you drive recklessly, though, it will have the adverse effect and your insurance will go up.
FAQs
Up until your late-60s and 70s yes. As long as you have a clean driving record then insurers will see you as a lower risk of claiming due to your age and driving experience.
Young and inexperienced drivers get hit with the highest premiums, as they’re statistically the most likely to have an accident.
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Esther Wolffowitz was a publisher at finder.com specialising in insurance. Esther holds an MSc in Media and Communication Governance from the London School of Economics and Political Science (LSE). See full bio
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