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Car insurance premiums


Car insurance providers calculate the cost of a policy by taking a variety of factors into account, including your age and claims history. However, premiums still vary significantly from one car insurance provider to another.

John Brady, Head of Commercial at John Lewis Insurance looks at how you can find the best priced car insurance.

Q & A with John Brady

Q. What factors affect a customer’s insurance premium?

A. Car insurance providers consider what are called ‘risk factors’ when calculating a car insurance premium. Risk factors include your age, postcode and the number of claims or accidents you’ve had in the past. Insurance providers use this information to infer the risk you may pose on the road and the likelihood of you making regular claims.

Q. Why is it more expensive to insure younger drivers?

A. Younger, more inexperienced drivers are known to cause more accidents. The Association of British Insurers found that although only 12% of drivers are aged between 17 and 24 that age group is still responsible for almost
30% of accidents.

A mature driver with a history of no claims is generally a lower risk to a car insurance provider than younger driver. A lower premium simply reflects a lower calculated risk.

Q. Why do women often pay lower car insurance premiums than men?

A. Statistically speaking, women live longer and are less likely to be involved in a car accident than men. Women therefore pose a lower risk to car insurers and pay lower premiums accordingly.

However, women may not benefit from lower premiums for much longer. A recent anti-discrimination ruling by the European Court of Justice means that after December 2012, insurers cannot take a customer’s gender into account when setting their insurance premiums.

Quotation MarksYou can often reduce your car insurance premium by fitting extra security to your car and maintaining a
history of no claims.Quotation Marks

Q. Does the type of car I drive affect the
premium I pay?

A. Yes, a car with a more powerful engine, for example, will generally be more expensive to insure. Cars which can accelerate quicker and maintain higher speeds on the road are potentially more at risk of accidents than slower, older cars.

Q. Why do car insurance premium prices differ between providers?

A. Cheaper premiums may mean less comprehensive cover; you might not receive a courtesy car in case of breakdown, for example – so make sure you avoid compromising on quality of cover for cost.

Different providers also look at different risk factors when calculating premiums, which lead to different results.

Q. Have you got any expert tips to help me to reduce my car
insurance premium?


A. Yes – there are a number of steps you can take which may mean your provider can offer you a lower premium:

  • Fit extra security to your car, such as an immobiliser or additional locks, to reduce your car’s risk of theft.
  • Keep your mileage low as the more time you spend on the road, the more likely you are to be involved in an accident.
  • Pay a higher excess to lower your premium. The excess is the first part of any claim that you’ll need to pay – so be sure you’re happy to pay that amount in case you make a claim.
  • Use our optional Excess Protection to claim back up to £500 in excess payments following accident repairs to your vehicle.

For further tips and advice, please see our quick guide (PDF).

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John Lewis Insurance is a trading name of John Lewis plc. Registered in England No. 00233462. Registered office: 171 Victoria Street, London, SW1E 5NN. John Lewis plc is an appointed representative of Ageas Insurance Limited who are authorised by the Prudential Regulation Authority and Regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Ageas Insurance Limited. Registered in England and Wales No. 354568. Registered office: Ageas House, Hampshire Corporate Park, Templars Way, Eastleigh, SO53 3YA.

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