Car insurance premiums are on the up - here's how to save

Now that could be about to change.

Research by MoneySuperMarket reveals that car insurance premiums in March rose year-on-year for the first time in four years. 

The average motorist is now looking at typical annual premiums of £423, which is £24 more than they cost in March last year.

So is this the beginning of a new inflationary trend?

Reversing the trend

Since March 2011, average premiums have fallen by 24%. But the latest year-on-year figure is up 6% compared to last March, when average annual premiums would have set you back £399.

"Hikes in car insurance premiums often happen in March as that's when new registration plates are introduced... "

And premiums aren't just up year-on-year. They've also risen month-on-month, so motorists will have paid on average £7 more in March compared to February.

Why the rise?

Hikes in car insurance premiums often happen in March as that's when new registration plates are introduced.

If you're one of the many people who snapped up a new motor last month, then you'll also have needed car insurance. Extra demand for cover means that insurers can bump up their prices.

It's the same story in autumn, as September is the other month when new registrations are launched.

Premiums reached an annual high of £456 in November last year following the introduction of the new '64' registrations in September.

Competitive pressure

Kevin Pratt, insurance expert at MoneySuperMarket said; "British motorists have benefited from a very competitive insurance market recently, with prices dropping by almost a quarter since March 2011. However, prices can only go so low before insurers have to bring them up again.

"This is no consolation for motorists, though. Driving is expensive enough, without the rising cost of insurance. As prices rise, it's more important than ever that motorists shop around for cover, to ensure their getting the most for their money."

Drive down costs

The good news is that there are plenty of tactics you can deploy to reduce the cost of cover.

Here's our top tips on how to keep premiums to a minimum...

• Never automatically renew your cover Loyalty DOESN'T pay when it comes to car insurance, so always shop around to see if you can find cheaper cover elsewhere. Consumer Intelligence research in November last year shows that 51% of people who shopped around for cover via MoneySuperMarket saved up to £224.18 on their motor premiums.
• DON'T modify your car Any modifications you make to your car will push up the cost of your cover, so think twice before adding those alloys or that new entertainment system. If you do make a change, make sure you tell your insurer, or you risk invalidating your policy.
• Boost securityThe better protected your car is, the lower your premiums will be. Keep your car in a locked garage if you have one, or off-road if you can, and fit an immobiliser and alarm to deter thieves.
• Increase your excess The excess is the part of any insurance claim you pay yourself. The bigger you make it, the lower your premiums will be. A word of warning though - don't make it so big that you can't afford to make a claim.
• Calculate the correct mileageDon't plump for any old figure when putting your mileage down on your insurance form. Try to work out the right number as you'll pay for any extra you put down but don't actually use.
• Add a more experienced driver
  If you're a younger driver, add a more experienced named driver and it should reduce your premiums. NEVER put them down as the main driver - that's as called fronting, and it's illegal.
• Pay annuallyIf you can afford to fork out a lump sum, pay for your insurance upfront rather than monthly. Most insurers charge you interest if you pay every month.
• Get 'black box' cover
  If you're a responsible driver, then black box cover, known as telematics, which bases premiums on your driving behaviour, could be more cost-effective than standard insurance.

Please note: any rates or deals mentioned in this article w