It’s never been a worse time to be in the market for a new insurance policy. The amount Australians are spending on comprehensive insurance per year has risen sharply over the last several decades, nearly tripling in the last 20 years. If you’re a young driver, you’ve only ever lived in a time of rising insurance costs – between 1999 and 2016 the average annual premium shot from $405 to $1163. 

That’s not the end of it – that growth has continued over the last few years, with annual costs rising to a whopping $1253 by the end of 2019. Since 2016, the cost of car insurance has risen more than 2.5% every year, while for comparison wages have only grown on average 2.1% per annum over the same period. In real terms, this means most Australians have less money left over after paying their insurance premiums than they did three years ago.

If you haven’t moved, haven’t changed cars, haven’t added a new driver and haven’t gotten into an accident, what gives? Why are you paying more each year for the same insurance policy? In a nutshell, it’s because your premiums are linked to how much it costs your insurance company to cover all of its clients – not just you. Industry and societal changes can mean that your trusty ride of five-plus years is costing you more and more to insure, even as it gets older.

An example: New technology in vehicles combined with lower cost entry level models for luxury brands has led to a rise in the cost of repairing the average Australian car. These rising repair costs end up being passed on by the insurance company to their clients in the form of higher premiums, allowing them to meet the expense of getting these vehicles repaired.  

What you can do about it

Of course, those numbers are just averages – and averages can be beaten. There are tonnes of ways that you can reduce your insurance premiums, especially if you’ve just been renewing the same policy for several years.

First things first, talk to your insurer. Some insurers offer loyalty and safe-driving discounts for clients who have been with the company for a certain period of time and not made a claim in several years. These discounts can often shave a significant percentage off your renewal, putting money back in your pocket.

Second, think about how your circumstances have changed since you took out your policy. Some questions to ask yourself:

· Do you need to cover a driver under 25 years of age on your plan anymore – if your adult child has moved out of home, you may be able to shift them onto their own plan.

· Do you need a $0 excess? Accepting some cost in the event of a claim – such as $500 – could end up saving you more on premiums over the long run.

· Do you need to drive so much? Some insurers offer discounts for drivers who use their car less than average, reducing their risk of an accident.

Finally, if none of that works, it might be time to look elsewhere. Many insurers offer competitive bonuses for switching, even more so if you bundle your insurance. This might be the time to take a look at all of your policies and consider bringing them under one roof.

A more permanent solution

But what if you’re already doing all you can? Let’s be honest, choosing a higher excess might save you money every month on your premiums, but it’ll come back with a vengeance when you have a bingle. And if you do need to cover a younger driver and you do use your car every day, what then?

What if you could just pay one low weekly fee for a car with registration, servicing, roadside assistance and comprehensive insurance, forever? No tense negotiations with your insurer, no endlessly comparing policies – just one payment every week at a rate you can predict months in advance.

It’s all a part of a Carbar car subscription. Our no dramas service gives you exclusive access to the car of your choice for as long as you want, with roadside assistance, registration, servicing and – yes – insurance bundled together.

To learn more about car subscription, browse our range of vehicles or join for free, visit carbar.com.au today.