Don't pay too much for your car insurance!

Don't pay too much for your car insurance!

Like the publicans, the motor trade has done it's fair share of whingeing over the last few years. If you listened to the Vintners you'd think that the entire country had joined the temporance movement, and if you listened to SIMI, you'd think there was tumbleweek rolling across the forecourts of the nation.

In fairness to the motor trade, 2009 must have come as a bit of a shock. After selling an unbelievable 181,000 new cars in 2007, sales started falling and had crashed down to just 54,000 cars by 2009. A drop of 70%.

Of course something had to be done. Irish people couldn't be allowed to stop buying cars! So some hardcore lobbying and a couple of scrappage schemes later and tons of perfectly respectable old bangers were taken off the road and replaced them with a fleet of shiny new Golfs and Fiestas. And sales went back up to 87,000 for 2011. Which seems pretty healthy given the state of the place.

We bought most of those cars (nearly 51,000) in just the first four months of 2011, and that's the way it's been since the "new" reg plates; we buy our cars at the start of the year. Of course January is the busiest month for car sales and last year was no exception. 13,624 new cars were sold in January compared to only 597 in December!

So, what I'm getting at here is that in the first few months of the year, 60% of us need to renew our car insurance. Of course, it's a terrible time for big bills, with just about everyone looking for money off us, so saving a few quid on insurance is well worth a bash.

Last year at the bonkers.ie HQ we followed our own advice, called a bunch of insurance companies and everyone who played saved.

This year, we're running the bonkers.ie car insurance challenge again. We have a brand new car to insure and so as I write, my colleague is busy trying to get himself some CHEAP car insurance.

Unlike the UK, there are no comprehensive car insurance comparison services operating in Ireland. Yes, there are some sites that look like comparison services, but they are generally brokers, or provide quotes and insurance through just one company. So without the kind of tools and transparency our neighbours in the UK have, we need to do the spadework ourselves if we were going to get the best deal or bring down the cost of our insurance.

So, before buying or renewing your motor insurance, it is very important that you shop around. Don't fall into the inertia trap! Which is exactly what your insurance company wants to happen. They send you a renewal letter - often with an increased rate - and hope you will simply pay up. Even if you use a broker and you expect them to do the legwork for you (after all that's what they're paid for, right?) you might find that by following a few simple steps, you can save even more off your renewal premium by yourself.

So here's our famous four steps for saving money on your motor insurace:


Step 1: When you receive your renewal letter - 3 weeks to renewal

If you're like most people, the renewal letter comes in the post, is opened and ganced at. You probably tut-tut at the price and promise that you'll try and find a better insurance rate. Rather than doing what most people do - ignore it until the day before renewal - or ignore it altogether and let them auto renew you! Why not immediately win the upper hand by getting 3 other quotes? There are brokers with websites that you can start from if you don't want to talk to actual humans at insurance companies first...It shouldn’t take more than 30 minutes to get 3 quotes.

Step 2: 7 days before renewal

Contact your existing insurer. Tell them you're surprised that the premium is as high as it is (even if you're not). Ask how much it was last year, and if it’s gone up, ask why. This will tell them that you are serious about paying them as little as possible. Tell them you have 3 other quotes and theirs will need to improve. Your premium is much more flexible than you may think and to keep you as a customer, they will probably reduce it on the spot. Ask them if this is their best and final rate - you might squeeze another few euro out of them. You should now have your best renewal rate.

Step 3: 5 days before renewal

Revisit the 3 quotes you have, call the three insurance companies and tell them your best renewal rate. Some companies - like the AA - have a "match best renewal" offer where they will beat the premium by €20 on like-for-like policies. If your bestrenewal policy has the same benefits as theirs, they'll beat it by €20 to win your business. See if the other companies will do the same, and remember you're in the driving seat - if you don't drive you won't get anywhere.

Step 4: 2 days before renewal

Make your selection, pick your insurer and tell them the good news - you've just given someone commission so they will be happy. Get your cover started with a new insurer or renewed with your existing one, but at a reduced price than their first offer. 

By using this approach, you should certainly save a few quid... well unless you crash a lot or you've just picked up a mid-life crisis car! All it takes is a few phone calls which you won't have to make again for another year. And for an extra hundred euro or so in your pocket, it’s not that much trouble really, is it?


So what happend at the bonkers.ie insurance challenge this year.

Well, the new car chap just bought a Volkswagen Tiguan. He's looking for comprehensive insurance for his wife and himself. He got his list of insurance companies together, sharpened his pencil and started dialing.

His quotes were all over the place. They ranged in price from well over €600 from his current insurance company to just over €400 from a new one. The most expensive wanted an excess of €600 and one of the cheapest wanted an excess of just €250 - which doesn't seem to make sense but there you go.

In the end, he signed up to Zurich for a very respectable €428 with an excess of €250. With his policy, he got breakdown assistance, windscreen cover, no claims step back cover and even third party on other people's cars. Savings? Over €200.  And guess what? His new insurance for his shiny new car is actually  much cheaper than his old insurance for the old car he traded in. So a little spadework can definitely still dig up a few euros.

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