Auto And Motorcycle Insurance: Strategies For Affordability

Auto and motorcycle insurance can be expensive, but there are ways to make it more affordable. The cost of insurance depends on several factors, such as the type of vehicle, age, experience, location, and policy. For example, sports bikes tend to have higher insurance rates than cruisers or touring bikes, and young and less experienced riders pay more than older and more experienced ones. Additionally, location plays a role, with drivers in urban areas typically facing higher rates due to increased accident and crime rates.

To save money on auto and motorcycle insurance, one strategy is to choose the right coverage by considering state minimum requirements and individual needs. Taking safety courses, bundling insurance policies, and maintaining a clean riding record can also lead to discounts. Comparing quotes from different companies is crucial, as rates can vary significantly.

Another way to reduce costs is to consider the type of bike and its features. Smaller and less powerful bikes tend to have lower insurance premiums because they are seen as less of a risk on the road. Improving the security of your vehicle can also lead to reduced rates.

Choose a smaller, less powerful bike

When looking to save money on auto and motorcycle insurance, choosing a smaller, less powerful bike is a great option. This is because the size of a bike's engine is directly related to how much your insurance will cost. The measurement used to determine engine size is "cc", which stands for cubic centimetres. The higher the cc number, the more powerful the motorbike will be.

Insurers typically see powerful motorbikes as more of a risk than those with smaller engines, as they are perceived as more likely to be involved in an accident. This means that as the power of your motorbike increases, so will the cost of your insurance. For example, a 250cc motorbike will cost significantly less to insure than a 1000cc motorbike.

If you're looking to save money on insurance, it's worth considering a bike with a smaller engine. While you may not want to buy a new bike just for cheaper insurance, it's something to keep in mind when you're next in the market for a new bike. Opting for a less powerful bike will not only save you money in the long run but will also reduce your risk of being in an accident.

In addition to choosing a smaller, less powerful bike, there are other ways to reduce the cost of your motorcycle insurance. These include improving your motorbike's security, avoiding modifications, and choosing a comprehensive insurance policy that meets your specific needs. By combining these strategies, you can significantly reduce the cost of your insurance while still ensuring you have the coverage you need.

Purchase a level of cover that meets your needs

When it comes to purchasing motorcycle insurance, it's important to select a level of coverage that aligns with your specific needs. There are three main types of motorbike insurance to choose from:

Third-Party Insurance

This type of insurance covers compensation and legal costs in the event that you injure someone else or damage their property. However, it does not provide compensation for your own costs.

Third-Party, Fire, and Theft Insurance

This option includes the protection offered by third-party insurance and extends to cover compensation if your bike is stolen, damaged, or destroyed by fire.

Comprehensive Insurance

This provides the same level of protection as third-party, fire, and theft insurance, but it also covers your own medical costs and the costs of repairing or replacing your bike, even if you were at fault in the accident.

When deciding on the level of coverage, consider the value of your bike. If your motorcycle is not very valuable, you may not need first-party coverage, and a comprehensive policy could be avoided to save money. On the other hand, if your bike is worth more than $5,000, or is a classic or custom model, a comprehensive policy is highly recommended to protect your investment.

Additionally, consider your own circumstances, such as your riding habits, location, age, and the type of bike you own. If you rely on your motorcycle as your primary mode of transportation, a comprehensive policy can offer peace of mind and faster repairs or replacements after an accident.

Remember, the right insurance policy should fit your needs, lifestyle, and budget. By choosing a level of coverage that meets your specific requirements, you can ensure you're properly covered while keeping your costs manageable.

Consider your mileage

One of the main factors used to calculate your auto and motorcycle insurance quote is the amount of miles you drive on average per year. The further and more often you drive, the more likely you are to be involved in an accident and need to make a claim. So, the higher your annual mileage, the higher your premium is likely to cost.

If you're looking to save money on your insurance, consider cutting down on your mileage. This could mean taking public transport to work instead of driving, or cutting down on unnecessary leisure trips. By reducing your time on the road, you can also reduce your risk of an accident and lower your insurance costs.

It's important to be accurate when estimating your mileage. Underestimating your mileage could invalidate your policy and your insurance provider could refuse to pay out in the event of a claim. Overestimating your mileage will mean you pay more for your premium than necessary.

You can calculate your mileage by checking your annual MOT certificate or your car's service record. Mileage is noted in your logbook every time your car has its annual service. You can also calculate it by working out how many miles you drive each day and adding them up.

If you are a low-mileage driver, you may be able to save money by taking out a specialist policy. Some insurance providers offer specific low-mileage insurance policies, such as discounted rates for those who drive less than 25 miles per day.

Overall, considering your mileage is an important factor in keeping your auto and motorcycle insurance costs down. By reducing your mileage, choosing an accurate estimate, and exploring specialist policies, you can make significant savings on your insurance premiums.

Pay your insurance annually

Paying your auto or motorcycle insurance annually is almost always the cheapest option. While it may be more difficult to pay a large sum upfront, you will save money in the long run by avoiding interest payments that come with monthly instalments.

Advantages of paying annually

• You will save money overall.
• You won't have to think about your insurance again for another year.
• Your insurer will only run a soft credit check, which won't show up on your credit report.

Disadvantages of paying annually

You'll have to pay more money in one go.

How to save for an annual payment

If you can't afford to pay your insurance annually, you can save ahead throughout the year. You could also consider taking out a credit card with a 0% interest period and paying it off within that period.

Increase your voluntary excess

Voluntary excess is a non-compulsory amount that you can choose to pay on top of the compulsory excess. The compulsory excess is set by your insurance provider and is non-negotiable. The voluntary excess, on the other hand, is an optional, flexible amount that you, as the policyholder, have control over.

When you receive a car or motorcycle insurance quote, it is worth experimenting with different voluntary excess amounts to see how they affect your monthly premiums. You can usually choose the amount of voluntary excess in £50 increments. For example, your voluntary excess might be £100, £150, £200, and so on.

Increasing your voluntary excess can reduce your premiums. Insurers offer lower premiums to drivers with higher excesses because a larger total excess lowers the chances that the insurer will need to pay out for a claim. However, opting for a high voluntary excess is a gamble. If you don't claim on your policy, you will save money. But if you need to make a claim, you will have to pay a larger sum of money.

When deciding on the level of your voluntary excess, consider your disposable income and financial stability. You should set it at an amount that you can comfortably manage to pay while taking the compulsory excess into account.

It is important to remember that if you make a claim, you will have to pay both the voluntary and compulsory excesses. So, ensure that you choose an amount that you are confident you can afford.

Frequently asked questions