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Should I get multi-car insurance?

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Multi-buy discounts are great in supermarkets, but how do they work with car insurance? And could they really save you money?

new cars in a row

Jump to: How multi-car insurance works | Drawbacks of multi-car cover | Shop around | Other ways to save

If your household has more than one car, then you’ve probably considered multi-car insurance. But with so many insurance companies offering multi-car policies, how do you know which is the right one for you?

We live in motoring boom time. Government statistics show that around one in three homes now has more than one car. And with the cost of car insurance rising over recent years, it's worth getting whatever discounts you can.

Multi-car policies can be a way for some families to save on the cost of cover, here’s a look at how it works.

How multi-car insurance works

Multicar insurance diagram

Certain insurers offer groups of people who live at the same address the chance to insure all their vehicles under the same umbrella policy.

This means you only have one set of paperwork to complete, and a single renewal date each year. These policies apply even if the vehicles have different main and named drivers, provided they’re all registered at the same address.

Typically, a multi-car policy will cover between two and five cars. From an insurer’s point of view, encouraging families or groups to get this type of cover brings in more business than if they each went with a different firm.

That's why companies are happy to offer discounts on what the group would pay if they each bought individual policies from the same provider.

Insurers say that some groups or families with several cars can save more than 20% on their insurance - not a bad little saving. However, discounts for homes with two drivers and two cars are likely to be less favourable than this.

Drawbacks of multi-car cover

If you have several cars within your household, there’s a good chance that each vehicle will have a different renewal date. However, with a multi-car insurance policy, an insurer will normally offer to bring the renewal dates into line under the one policy.

While this makes things easier in one respect, you should bear in mind that once all the cars' renewal dates are the same, the household will face a large one-off insurance bill at the same time every year. This could require a bit of smart budgeting.

Let's shop around!

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Another potential drawback is that just because you're getting a discount for a multi-car policy, you shouldn’t automatically assume this is the cheapest way of buying cover.

It could still be cheaper if each driver gets their own cover from different insurance providers.

For example, the company offering a multi-car policy may be especially expensive for young male drivers. So including your 18-year-old son on a group policy could turn out to be more costly even with a discount factored in.

Other ways to save on car insurance

Households with several cars are likely to have seen their insurance payments rise over recent years. But there are other ways you can try to keep a lid on car insurance costs:

  • Add a named driver - if one of your family’s drivers is young or inexperienced, adding a more experienced named driver, such as a parent, to the policy could result in a fall in premiums.

  • Increase your excess -  You can cut your premiums by opting for a larger voluntary excess. If you agree to pay the first £250 of any claim rather than just the first £100, your policy could cost less. However, it’s always best to consider what you could afford if a car does get a bump – it’s a bit of a balancing act.

  • Improve security - if your car is fitted with an alarm or immobiliser, it will be harder to steal. This should in turn lead to cheaper car insurance.

You can find more helpful tips for saving money in our guide, driving down the cost of car insurance.

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