Danny Butler

As a starting point, I'd be looking for a vehicle in a low insurance group in a popular colour with no modifications. For additional savings, I'd look at increasing the excess slightly (if this is an option for you) to lessen the risk for the insurance company and decrease your premiums. Lastly, make sure that you shop around and compare several quotes from a range of different providers and look at different policy dates. The price changes are often substantial and a slight change in policy date could make a big difference to your bottom line.

Throughout the course of the pandemic, it’s safe to say that the car insurance industry has had to make adjustments to adapt to the changing wants and needs of the consumer. With a large proportion of the adult population working from home and restricted to essential travel only, car usage is predictably down on previous years. Car usage in the UK declined over the past decade before plummeting in 2020 - lockdown just accelerated the trend. With this reduction in car usage, you’d expect the costs of car insurance to decline in tandem – but sadly, this has not universally been the case. With the recent pandemic shining a spotlight on this issue, the FCA intervened on several occasions throughout the course of 2020, requiring insurers to reassess their customers' latest risk profile and offer them a more suitable product based on their usage. There were also calls for insurers to do more in terms of refunding customers for “unused” portions of their policy. The traditional model of car insurance relies on a customer estimating an annual mileage and stating their class of use as a key component in returning a quote. If the driver’s annual mileage drops by 5,000 over the course of the year or they no longer have to travel to work, then this is an obvious flaw when it comes to the pricing model. As a result more and more consumers have opted for “pay as you go” or usage-based insurance which is exactly what is says on the tin. Customers prefer the no-nonsense, transparent approach to pricing and it has been insurtechs that offer this pricing model that have had the upper hand throughout the pandemic. Whether these companies will be here to stay, only time will tell.

Car insurance is likely to undergo big changes over the next 10 years. The pandemic has highlighted a flaw in the traditional pricing model, which has seen a surge in usage-based insurance companies that address that flaw. With traditional insurers having to innovate more than ever to appease the growing demands of the consumer, we can expect an extremely competitive playing field where the consumer will hopefully finally win. This surge in innovation, coupled with the rise of the electric vehicle market and other sustainable vehicles, will make for a very exciting decade to come.