The tumbling price of petrol!

At last some good news for motorists everywhere, as petrol prices appear to be falling. Asda and Morrisons announced cuts following a drop in oil prices, and will now sell petrol at 113.9p a litre – the national average is 119.5p.

Motorists will be hoping that the cuts spark a price war to send the litre back down below the one pound mark, and with Sainsbury’s also offering to knock off 5p a litre to those spending £50 or more in store it looks like they might be in luck.

Even with the cost of petrol looking to have peaked, however, increasing car insurance premiums still keep motoring a costly business. looks at some of the ways to keep you on the road for less.

Get de-bit between the teeth

As with falling petrol prices motorists may have leaped at the opportunity to pay for their car insurance by direct debit, thereby spreading the cost and avoiding an awkward lump sum payment.

Though the option sounds good in principle, and in many cases may be an absolute necessity, it is likely to end up costing you considerably more. Indeed, research from MoneyExpert has found that paying by direct debit will cost on average an additional 37%.

With standard car insurance policies already approaching the £800 mark, a direct debit payment system could see you forking out as much as £1,050. If you’re in a higher risk bracket, paying an even higher premium, then the difference will obviously be even greater.

Only a handful of providers (14%) have a flat rate cost for direct debit and upfront payments.

Paying in excess

Car insurance can be a fairly complicated product, with premiums calculated according to risk, location, type of car, no claims bonuses etc. Obviously some of these factors are outside the control of the humble motorist but you can, to a degree, choose how much you pay as an excess when you make a claim.

The excess is the amount you’ll have to pay regardless of the type of cover you have. Even if you have a fully comprehensive insurance policy when you make a claim you’ll have to pay something, normally around £100.

You can, however, choose to pay a higher excess, and this could considerably reduce the overall cost of your insurance premium. It’s obviously a bit of a gamble given that if you do make a claim you’ll be paying more up front. The savings made on the premium, though, could make it well worth it.

Online options

There are obviously a whole raft of ways that you can reduce the cost of your car insurance premiums. Most of these, though, will involve some fairly major changes, such as driving a cheaper car, parking off road, or moving house!

A much better route to a cheaper deal could be to get online and compare the market. MoneyExpert research indicates that car insurance premiums are around 35% cheaper online with insurers avoiding the cost of manually processing your application.

Click here to compare car insurance premiums

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