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Following announcements from leading motor insurers in 2007, premiums for UK car insurance are expected to increase by 10-20% in 2008.

A variety of causes have been quoted from an increase in claims due to unforeseen events such as the recent floods to premiums already being artificially low for some years. Whatever the reason, an additional hike in motoring costs in conjunction with increases in other non-discretionary costs of living mean that 2008 could be a costly year for millions of UK residents.

Fortunately, there are numerous steps you are able to take to counter these inflation busting increases on your motor insurance.

Step 1 - Do not believe the hype

In spite of what the adverts explain to you, there is much more to finding the cheapest cover than simply comparing the quoted rates. It is a complex, multi-variable product, and deserves your attention due to this. Have a good think about how and when you use your car and what kind of cover and options you do and do not need. Numerous of us continue to renew policies with options we do not need and are unlikely to use.

Step 2 - Search online for the right cover and the lowest price

The primary benefit of searching online is that you are able to compare cover and premiums from several dozens of companies utilizing the same information. Price comparison websites will give you a baseline to work from, but be aware that not all comparison sites are equal. A few make assumptions regarding your needs and get quotes that could be higher or lower than you’ll be offered. Search for comparison websites which guarantee the accuracy of the premiums quoted.

Step 3 - Look to non-traditional and newer insurers for the best prices

A surprising study run by a consumer advocacy group ran profiles through 33 insurance companies via multiple price comparison sites, and checking numerous risk profiles. The end result was that newer insurers, and insurers not known for doing motor cover persistently came out with the cheapest premiums. Do not close your eyes to a good price simply because the company isn’t “known” for car insurance.

Step 4 - Get cover which matches your driving needs and habits

Many of us just buy a standard car insurance policy with cover options that we’re not likely to need or use. If you are a low mileage driver with a standard policy, you could be wasting hundreds each year. There’s even a new ‘pay as you drive’ policy which uses a GPS device built in your car to ensure that your premiums are linked to your personal driving habits including mileage, the roads you use and time of day you use them.

Step 5 - Minimize the risk and take full advantage of discounts

Premiums for any insurance are based upon risk, so to reduce your premiums, try and reduce the risk of needing to claim on your policy. Factors like where your car is parked, how it’s used and how secure it’s are all factored into premiums. A bit known trick which can work with a few insurers is to add a low risk named driver to your policy. A female over the age of thirty with a clean driving record can cut your premiums by 5-10%.

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