The consumer center gives advice: how to save on car insurance

If you own a car, you need to insure it, and many car insurance policies are going to get more expensive over the next year. This is due, for example, to the general increase in claims and costs, to the category of personal claims and also to the classification of the vehicle in the regional category. “Most policyholders can cancel their vehicle contract at the end of the calendar year and sign a new one,” says Karin Bordin, director of the Weseler advice center at the NRW consumer advice center. “And if the insurance premium increases, there is a special right of termination. Regardless, it’s a good idea to check your own car rate every year. A change or a consultation with the insurance company can save several hundred euros”.

• What does good car insurance offer?
Civil liability insurance for motor vehicles is mandatory. Since the damages caused by car accidents can amount to millions, it is advisable to have a high sum insured, preferably at least 50 to 100 million euros. Also, gross negligence should definitely be included in comprehensive insurance. This avoids problems with the insurer in the event of a loss, for example, if you were distracted and ran a red light and the car was damaged in an accident.

• How easy is the change?
If you want to terminate a contract, you often have to do so in writing and respect the notice period. Most contracts can be terminated before December 31. Cancellation must be received by the insurance company by November 30 to be on the road with new motor vehicle liability insurance and comprehensive insurance beginning January 1 of the following year. Some insurers have changed this. For this reason, a look at your own contract may be important. In addition to this “ordinary termination”, the termination can also be given after a premium increase or a loss. A switch can be worth it, because new customers are often lured in with cheap rates. If you want to continue with your existing insurer, you should at least talk to them about possibly giving you a discount.

• When is a change not advisable?
A change does not always make sense. Anyone who has caused damage, for example, is downgraded by the insurance company to the no-claims class (SF class) – the contribution increases. However, if discount protection has been agreed, the insurer waives this discount. However, this special regulation only applies to the current provider. If you change, the new insurer usually classifies you in the SF class, taking into account the accident, that is, down. That can wipe out any savings.

• How is it cheaper in the current contract?

It is also possible to save without changing providers. By paying annually, you can already save a few euros on the current contract. It is also cheaper when the children have left home and are no longer registered as young drivers. This must be reported to the insurance company as soon as possible. The same applies if you drive significantly fewer miles per year due to moving, retirement, or working from home. Because the contribution is calculated based on numerous factors, in addition to mileage and age, also the place of residence, the model of the vehicle, the use of the garage or the question of whether you live for rent or own your property. It’s also cheaper without comprehensive insurance, which is especially unnecessary for older cars. With partially comprehensive insurance, costs can be lowered with a higher deductible.

• How does regional class placement work?

The cost of motor vehicle liability insurance depends, among other things, on the region in which the vehicle is registered. In the so-called regional classes, the loss balance for a specific region is recorded over a five-year period. When accidents happen frequently and insurers have to settle a lot of damages, it’s expensive. The lower the damage in a region compared to the national average, the cheaper it is. This classification changes annually. The basis is the damage to the individual registration areas. As of 2023, 10.1 million car owners will be classified in a higher, i.e. more expensive, regional class, only 5.5 million in a lower class and 26.8 million motor vehicle liability policyholders they will remain in their previous regional class.

More information and links:
◦ More information on car insurance at www.Verbraucherzentrale.nrw/node/13890

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