Cheapest car insurance and how to pay less

Car insurance is one of those bills where the difference between overpaying and getting a good deal can be hundreds of pounds. The trick is knowing what actually moves the needle.

Current Average Costs by Age

Good news: premiums dropped significantly in 2025, with young drivers paying nearly £1,000 less than the previous year on average.

Things That Actually Cut Your Premium

1. Compare Every Single Year

Never auto-renew. Your existing insurer almost always offers a worse deal than what's available elsewhere.

Use at least two comparison sites, because they don't all show the same insurers. Also check Direct Line and Aviva directly, as they don't appear on most comparison sites.

2. Buy 3-4 Weeks Before Renewal

Insurers price based on urgency. Buy too early (8+ weeks out) and prices aren't finalised. Buy too late (last few days) and they charge a premium because you're desperate. The sweet spot is 20-28 days before your policy starts.

3. Add an Experienced Named Driver (Young Drivers)

If you're under 25, adding an older experienced driver to your policy can save around £355 on average. This is legal and sensible. What's illegal is "fronting", where the experienced driver is listed as the main driver but actually isn't.

4. Consider a Black Box (Telematics) Policy

Telematics policies monitor your driving. If you drive safely, you pay less. For 18-24 year olds, this saves around 6% or more on average. Worth it if you drive sensibly and mainly during the day.

5. Pay Annually, Not Monthly

Monthly payments include interest, typically adding 15-30% to the total cost.

6. Increase Your Voluntary Excess

Raising your voluntary excess from £250 to £500 can cut premiums by 5-10%. But only do this if you can actually afford to pay £500 plus the compulsory excess if you need to claim.

7. Where You Park Matters

A car parked on a private driveway costs roughly £140 per year less to insure than one parked on the street.

8. Get on the Electoral Roll

Insurers use the electoral roll to verify your identity and address. Being registered can improve your credit profile and reduce premiums.

Things That Don't Help Much

Choosing a smaller engine for insurance alone. Insurance groups depend on more than engine size. Some small cars are in high groups because they're frequently stolen or expensive to repair.

Claiming you drive fewer miles than you do. If you have an accident and the insurer finds you've underestimated mileage, they can void your claim entirely. Be honest.

Building No Claims Discount

Protecting your NCD costs extra but means one claim doesn't wipe out years of discount. Usually worth it once you have 4+ years built up.

Where to Compare

Comparison sites (Confused.com, Compare the Market, MoneySupermarket, GoCompare) cover most of the market but not all.

Direct-only insurers like Direct Line, Aviva, and NFU Mutual don't appear on comparison sites. Check them separately.

Specialist brokers for unusual situations (classic cars, modified vehicles, young drivers with convictions).