27 Mart 2011 Pazar

Car Insurance

Car Insurance

Aside from depreciation, insurance is one of the biggest costs you incur as a motorist, so let's start there.

Shop around for Insurance Deals

For starters, you can shop around for the best deal on insurance.
If you own more than one vehicle, we've found that it's well worth looking at the total cost of the insurance of all the cars in your household, rather than treating each one in isolation.  Many insurers are now offering great deals on second cars, and if one of the cars is insured in your spouse's name you can often qualify for a discount if you both insure with the same company.  For example, in the UK, we found that Elephant is one insurer that offers such a deal.

Take notice of Insurance Groups

Aside from finding the best policy for your existing car, you should also consider the insurance group of the next car you buy.  Whilst you don't have control of all the factors that affect the cost of your insurance policy, this is one major influence on the cost of insurance that you can control if you want to.

What does a Car's Insurance Group mean?

Most people look at car insurance groups only as a guide to the cost of insurance. However, ask yourself why cars have low or high groups and youll quickly see that theyre an indication of so much more the higher the insurance group the more likely it is that your car is going to be stolen or involved in an expensive accident, or at least thats the way your insurer is thinking. And theyre not going by chance or intuition they have high powered computers crunching huge volumes of data to determine exactly what the risk posed by any given vehicle.

Automatic Car Insurance Groups

Of course if you want a particular type of car, youre going to pay the appropriate level of insurance but careful analysis of insurance groups can help you get the best value for your money. Take for example the Porsche Boxster S which in standard form attracts a whopping group 19 tag thanks to its 260 brake horsepower, 3.2 litre engine. Despite immaculate road-holding, ABS brakes and one of the finest chassis ever put in a road going car, the insurers have decided that its a big risk. But you can do things to reduce the risk you may have rejected the tiptronic gearbox option on the basis that it adds a hefty extra price to the already costly Boxster. But for many insurers the tiptronic Boxster is a group lower, and the difference between 18 and 19 can be considerable many insurers wont touch anything over 18, so there are a lot more companies to choose from when you go for the extra cost of tiptronic.
One reason for the lower group on the tiptronic Boxster S is that its performance is a little less sparkling on paper, but despite this most drivers will get better performance from it the tiptronic option may have a slightly higher 0-60 time in the hands of a racing driver, but under normal conditions, with an average driver, the tiptronic will outshine its manual sibling. And as the driver has to concentrate less on being in the right gear, he or she can concentrate more on the other.
So consider the higher resale value of the tiptronic and the savings youll make on insurance, but deduct the penalty youll pay for its slightly heavier fuel consumption. On balance the tiptronic might actually be a more enjoyable, and more economical consumption in the long term.
But most of all, consider the fact that the highly experienced staff of our biggest insurers, backed up by a wealth of data and powerful computers to process it, have decided that a Boxster S with a 6 speed manual gearbox is group 19 compared with a tiptronic Boxster S which they rate at group 18. And that one point is sufficient for many of them to refuse to insure it.

Other Insurance Group factors

Our enquires also revealed that although many companies will award cars a lower rating if they have ABS, not many have yet recognised the benefits of other active safety systems such as stability management. We investigated Porsches stability management system and found that its a superb safety aid, with a high performance computer system taking steps to keep you out of trouble when it detects, through its sophisticated sensors, that you are about to lose control of your vehicle. However, we were amazed that not one of the insurers we spoke to were prepared to offer a discount for vehicles fitted with this excellent system.

No Claims Bonuses

Another major factor that you can control when it comes to motor insurance is your no claims bonus.  OK, you're probably thinking that the bonus is what the bonus is, but do note that different companies have a different maximum no claims bonus.  So if you've been driving without incident for more than 5 years and your insurer only offers you a five year maximum no claims bonus, then it may be time to shop around.

Protect your no claims bonus

In the conventional sense this means that it's often worth paying that little bit extra to get a protected no claims bonus - which means that if you are involved in an accident that would have affected your no claims bonus, you can retain your bonus.  But beware of thinking that this will ensure that your policy doesn't rise the following year - in fact it may well rise because you were in an accident; you're now considered to be a greater risk according to many companies.  You'll still get your bonus, but off a higher initial premium which hardly seems fair.  As one insurer put it to us - it's a no claims bonus - not a no accident bonus.
So by all means protect your no claims bonus by paying a little bit extra, particularly if you have a number of years bonus to protect, but the best way to protect your no claims bonus is to do everything you possibly can to prevent the need to make a claim - no claims means no loss of your no claims bonus.

Avoid Claiming on your Insurance

So what can you do to avoid making a claim on your insurance?  Well, for starters, you need to ensure that you don't have a driving accident that is your own fault.  In fact, when it comes to car insurance you need to be very careful not to have an accident that isn't your fault.  One of our staff recently had an accident where another driver ran into the back of his car at lights.  Absolutely no blame whatsoever was apportioned to our driver; and in fact the other driver paid cash for the repairs.  But when he next renewed his policy, some insurance companies still increased his premiums because he'd been involved in an accident; back to the theory that a no claims bonus isn't a no accident bonus!
We'll be looking at how you can improve your driving technique to minimise the possibility of a fault, or non-fault accident in later articles.  Defensive driving skills can help protect you and your no claims bonus.
You also need to take care not to have to claim on your insurance for theft, fire, malicious damage or anything else if you can possibly avoid it.  OK, there are limits to how far you can go, but basic security steps will minimise the chances of you having to claim on your insurance for any of these reasons.