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How to Choose Car Insurance and Lower Your Premium

Choose car insurance by deciding the level of cover you need, from legal minimum third-party cover to comprehensive, then compare like-for-like quotes. Check the excess, extras and exclusions, not just the price. To pay less, compare every year, build your no-claims record, choose a sensible excess, pay annually, improve security, and always give honest, accurate details.

Updated
Time
30 minutes
Difficulty
Easy

By Published Oct 9, 2026

Quick answer

  1. 1 Decide the level of cover: third-party only, third-party fire and theft, or comprehensive.
  2. 2 Gather your details: licence, car registration, mileage, address and claims history.
  3. 3 Get quotes from comparison sites and directly from insurers.
  4. 4 Compare the excess, extras and exclusions, not just the price.
  5. 5 Lower the price: pay yearly, build no-claims, add security, consider telematics.
  6. 6 Answer every question truthfully.
  7. 7 Read the policy documents and set a reminder before renewal.
On this page
  1. Before you start
  2. Choose the right level of cover
  3. Compare quotes properly
  4. Lower your premium honestly
  5. Troubleshooting
  6. Frequently asked questions

Before you start

  • Your driving licence details
  • The car’s registration, make, model and value
  • Details of any previous claims or convictions
  • Your estimated yearly mileage

Method 1 Choose the right level of cover

As a rule, if you couldn’t afford to replace your car tomorrow, comprehensive cover is usually worth it.

  1. Step 1: Third-party only

    Covers injury to other people and damage to their property. It’s the legal minimum in many countries, but doesn’t pay for your own car.

  2. Step 2: Third-party, fire and theft

    Adds cover if your car is stolen or damaged by fire.

  3. Step 3: Comprehensive

    Also covers damage to your own car, even if an accident was your fault. It’s often not much more expensive than lower cover, so always compare.

  4. Step 4: Know the local terms

    Names differ by country. In the US, for example, policies combine liability, collision and comprehensive cover, and minimum liability limits are set by each state.

Method 2 Compare quotes properly

  1. Step 1: Use the same details everywhere

    Enter identical information on each comparison site or insurer, so quotes are truly comparable.

  2. Step 2: Check the excess

    The excess (deductible) is what you pay towards each claim. A low price often hides a high excess. Add the compulsory and voluntary excess together.

  3. Step 3: Compare the extras

    Check for courtesy car, windscreen cover, breakdown cover, legal expenses, personal belongings and driving abroad. Only pay for extras you’d actually use.

  4. Step 4: Read the exclusions

    Look at what isn’t covered: keys left in the car, commuting or business use, unapproved modifications, and named drivers.

  5. Step 5: Check reviews and claims service

    The cheapest policy is no bargain if claims are slow or difficult. Look at independent reviews and complaint statistics where published.

Method 3 Lower your premium honestly

  1. Step 1: Shop around every year

    Don’t automatically renew. Compare prices about three to four weeks before renewal; prices are often lower than on the last day.

  2. Step 2: Pay annually

    Paying monthly often adds interest. Pay in one go if you can.

  3. Step 3: Choose a sensible voluntary excess

    A higher excess reduces the premium, but only choose an amount you could pay tomorrow.

  4. Step 4: Build and protect your no-claims record

    Each claim-free year usually earns a discount. Consider paying for small repairs yourself instead of claiming.

  5. Step 5: Give accurate mileage and use

    Estimate your yearly mileage realistically; lower mileage often costs less.

  6. Step 6: Improve security

    Approved alarms, immobilisers, trackers and off-road or garage parking can lower prices.

  7. Step 7: Consider telematics

    A “black box” or app policy prices your insurance on how safely you drive, which can help young and new drivers.

  8. Step 8: Add an experienced named driver

    Adding a careful, experienced driver who genuinely uses the car can reduce the price for new drivers.

Troubleshooting

My renewal price went up a lot

Compare quotes, then call your insurer with a cheaper quote and ask them to match it. Check whether a claim, a new postcode or a change in the car’s value caused it.

I can’t get a quote

Try a specialist broker for young drivers, high-value or modified cars, or drivers with convictions.

I need to make a claim

Contact your insurer as soon as possible with photos, the other driver’s details and a police reference if needed. See our guide to making an insurance claim.

Frequently asked questions

Is the cheapest insurance the best?

Not always. Compare the excess, extras and claims service. A slightly more expensive policy can save money when you need to claim.

Does my insurance cover other drivers?

Only if they’re named on your policy or your policy includes “any driver” cover. Check before lending your car.

What does no-claims bonus mean?

A discount for each year you don’t make a claim. Some insurers let you pay extra to protect it, so one claim doesn’t wipe it out.

Summary

Pick the level of cover you need, compare like-for-like quotes, and look closely at the excess, extras and exclusions. Pay less by shopping around each year, paying annually, building a no-claims record, improving security and considering telematics, and always give honest details so your policy pays out when you need it.

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Written by

James Chambo

Founder

James is the Founder and Senior Editor of OnlineHow with more than 20 years of experience in internet publishing.