Why does my car insurance quote keep changing?

Driving

7 min read

It’s a scenario that anyone who’s ever shopped around for a car insurance quote will likely be familiar with. You log onto your computer or you phone up your insurance broker, give your details and receive your quote.

Then, perhaps only a day or two later, you get a quote again ready to buy your policy, only to find that the insurance price you were given has gone up. What gives?

It might be something you’ve done, it might be something you haven’t done, or it might be something you didn’t even realise that you’d done… Confused? Allow us to explain!

How insurance works

First, it’s important to understand exactly how your insurance premium is calculated. Essentially, insurance providers calculate risk and will offer you a premium based on how likely they think you are to make a claim.

Simple, right? In theory yes, but in practice it’s a lot more complicated. Insurers analyse all sorts of crazy statistics and patterns and if they spot something which might suggest an increase in risk, it can often result in you being charged a different premium.

Sometimes that might be something within your control, and other times it might be something completely unrelated. Below, we explain some of the most common reasons why the cost of your insurance might change.

You’ve recently changed address

You mightn’t realise, but where you live can have one of the biggest impacts on how much you’re charged for insurance. For example, if you’ve recently moved house to an area that statistically has a higher rate of crime – no matter how small – you might see your premium go up, as insurance providers could perceive that to mean that your car is more at risk of being stolen, broken into or vandalised.

It can also be a good thing though. If you’ve recently moved from an area with a higher crime rate to one that’s statistically safer, then the cost of your insurance could fall accordingly.

It’s not just crime rates that have an effect, either. If the people who live in your area have an average age of 45, that will likely result in a lower premium compared to an area where the average age is 25.

People who rent their properties can pay higher premiums than those who own their home too, as statistics show that homeowners are typically safer drivers!
 
As well as that, insurance providers will often ask where you keep your vehicle during the day and overnight. 

If you’ve seen the premium you’ve been quoted change dramatically in a short space of time, double check to make sure that you’ve listed your address correctly and also that you’ve accurately stated where your vehicle is kept.

Don’t be tempted to play around with the options to try and get yourself a lower price, however. If you tell your insurer that your car is kept in a locked garage overnight but you actually keep it on your driveway, if your car is then stolen you run the risk of invalidating your cover.

You’ve recently changed your job

Your job title can actually have a significant effect on how much you’re charged for your insurance. The reason for this is that, statistically speaking, the job that you do can reveal information about how risky a driver you might be.

Insurers’ statistics take into account everything from how often and how far you’ll likely have to travel for your job to how high pressure your profession is. That’s why journalists out looking for stories will typically pay more than civil servants, or why a surgeon will typically pay more than a hairdresser.

As a result, if you’ve recently changed profession or been given a promotion along with a shiny new job title, this could affect how much you’re quoted for your car insurance.

Some websites might encourage you to fiddle around with the job titles in order to lower your premium, but we would advise against it. Just as it’s your legal duty to disclose any penalty points or convictions you might have, it’s also your legal duty to disclose your job title as accurately as possible, otherwise you risk invalidating your cover if it comes to light that the facts don’t add up.

You’ve added or removed a named driver

If you’re a parent, adding your child as a named driver can be a great way to get them on the road affordably, provided that they’re not using your vehicle most of the time. Other people will add family or friends as named drivers, while younger drivers may add an older, more experienced driver to their own policy.

However, adding named drivers will affect the cost of your insurance one way or another. For people who add drivers who are categorised as higher-risk to their policies, the cost will go up.

Conversely, for people who add more experienced drivers to their policies, the cost of their insurance premium can sometimes be reduced.

If you’ve experienced a sudden change in how much you’re being quoted for your car insurance, it’s worthwhile checking whether the details of any named drivers you want to add to your policy are correct.

You want your insurance policy to start too soon

Maybe you’re close to your renewal period and you’re searching around for the best quote, or perhaps you’re re-insuring a car that’s been declared off the road for some time and you can’t wait to jump in and drive it – either scenario will likely see your insurance costs increase.

This is most often the cause for a rise in insurance quotes when all the details are completely identical, as your premium will typically get more expensive the closer to the date you want your cover to start.

The reasons for this are various, but most often it’s that people who buy their insurance at the last minute are seen as a greater risk, with statistics suggesting that they might have other related habits that could increase their risk on the road, for example routinely running late and driving faster to make up for it.

It’s estimated that more than half of motorists leave renewing their car insurance until the week that it’s due, with nearly 20% leaving it until the day their current policy expires. Typically, insurance providers will change their pricing each day of the week as the deadline ticks closer.

In the case of people who are insuring a car and want the cover to start immediately, for example if they’re buying a new car in the next couple of days and need insurance to drive it home, costs can likewise increase the closer to the date they want their cover to start. The reason for this is that insurers will view them as being desperate for cover, perhaps for an emergency situation.

In any case, it’s worthwhile doing your homework and getting your insurance cover as far in advance as possible. Many insurance providers will give you a quote and agree to keep it at that level for a period of time while you make up your mind, provided it’s well in advance.

Reasons that are outside of your control

With all of the above in mind, sometimes your insurance quote will go up seemingly for no reason at all, or at least not for anything that you can control. Unfortunately, this does happen, with reasons including everything from economics to the time of year.

One of the biggest changes customers will have noticed in the past year is the increase in Insurance Premium Tax, which is tax that the government applies to insurance policies. It works a little like VAT and must be applied to all insurance premiums regardless of cost or type.

Back in 2015, the government increased this tax from 6% to 9.5%, and again put it up to 12% in June 2017, which has driven up the price of insurance for everyone right across the country.

On a related note, economic factors like inflation and the overall strength of the country’s economy can see insurance premiums change as the cost of everything gets relatively more or less expensive. 

Even the time of year that your renewal is due will affect the overall cost, with spikes in the cost of premiums occurring during the summer when more drivers are on the road for longer, and in the autumn/winter period when more accidents tend