Saving money on van insurance

Van insurance is a legal necessity in the UK and if you are caught driving without it you could face severe fines and potentially even a driving ban. So you might think that as the product is essential it’s bound to be expensive too.Certainly van insurance premiums can be high – but the market is also competitive and it’s down to the consumer to use this to their advantage. Here we offer tips to help you find the right deal at the right price.

How much will you pay for van insurance?

To understand how to lower premiums, you must first understand how they are calculated. Insurers take into account a number of factors to determine how much you should pay including your driving history; your annual mileage; your personal circumstances; your address; and the van you drive. The greater your perceived risk of making a claim, the higher your premiums will be – and so taking steps to lower your risk in the eyes of an insurer can pay off with savings. Here is a step by step guide to keep your premiums in check.

Choose your van carefully

Saving money on van insurance begins before you even buy a van itself. As insurers assess the vehicle when determining premiums it’s important to make the right choice – and generally, older vans without specialist equipment and with small engines will qualify for cheaper premiums. This is because older vans typically cost less to repair/replace, as do those with standard specifications. Those with smaller engines are less likely to be driven at fast speeds and so also typically earn cheaper quotes too.The Association of British Insurers (ABI) actually classifies vans into groups with ratings based on the risk of the vehicle. It considers the vehicle’s value; how much it costs to replace/repair; its performance, acceleration and top speed; and whether it has a security system. You can use the ABI database to gain an overview of how much you’re likely to pay to insure a van before you buy.

Think about the level of cover you need

You also need to think carefully about the level of insurance you choose. There are three broad options:

- Third party only: This covers liability for injuries to others, damage to their property and liability while towing a caravan or trailer.
- Third party, fire and theft: As with third party cover plus protection for your own vehicle against theft, theft-related damage and fire damage
.- Comprehensive: As with third party, fire and theft plus repairs to your van in the event of an accident, subject to exclusions.

Depending on the policy you choose, you may also benefit from additional cover features such as personal accident cover, a courtesy van while yours is repaired, legal cover and accidental damage cover. The key however, is to not pay for cover that you don’t need.For example, be careful how you define your vehicle use. The categories are: social, domestic and pleasure; social, domestic, pleasure and commuting; business use; and commercial travelling. Clearly if you don’t need a van for work-related purposes beyond commuting then there is no reason to pay for additional cover.

Choose an appropriate excess

An excess is what you are liable to pay towards a claim and is usually divided into a compulsory excess set by the insurer and a voluntary excess which is an additional amount you agree to pay when taking the policy out in case a claim is ever necessary. The voluntary excess is paid on top of the compulsory excess. Increasing your voluntary excess will generally reduce the price of your van insurance but don’t go overboard – keep it at a level you can afford.

Look for bonuses

Most van insurers offer no-claims bonuses for those who don’t make a claim on their policy. This could be worth as much as 60 per cent off a premium after four or more years. However, even if the claim is not your fault your bonus will usually be affected unless the costs can be recuperated from the other driver’s insurance company. It is possible to take out no-claims discount protection to safeguard your bonus against one claim; while some insurers also offer mirrored bonuses if you have more than one vehicle.

Reduce your risk

There are other ways to limit the risk of making a claim and subsequently lower premiums including:

Agree to a mileage limit – The fewer miles you spend on the road the lower the risk of an accident occurring. Boost security – Get an insurer-approved alarm and immobiliser fitted to your vehicle to deter thieves.
Limit named drivers – Don’t add inexperienced drivers to your policy as they can cause your premiums to increase. Park safely – Park your van off the road, preferably in a locked garage away from prying thieves.
Pay annually – By paying premiums upfront you can avoid interest charges.

Finally, don’t forget…

Take as thorough an overview of the market as possible by comparing van insurance policies with a comparison website. Even if you find a cheap deal one year, you should still shop around during every renewal period to take advantage of introductory offers.

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