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How you affect your premium

Car insurance premiums can vary quite dramatically, with even apparently similar people with similar cars having very different premiums. Why? Because there are all sorts of factors taken into account when setting the premium. Ultimately, the lower the apparent risk, the lower the premium.

Here's what insurers consider:

	Your age

	Your gender

	Where you live

	What you drive

	Your job

	Your experience

Your age

Unfortunately the statistics show that young drivers are considerably more at risk of having an accident than older drivers. Partly it's down to having less experience, partly because young drivers are overconfident of their abilities.

If you're not 17 yet, you can gain valuable experience with the Young Driver scheme sponsored by Admiral. If you've just passed your test, you might want to consider PassPlus; it also gives you valuable experience and might help reduce your insurance premium.

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Your gender

Statistically, women drivers are safer than men, and that used to mean they benefited from a lower premium. However a recent EU ruling has declared that is discriminatory, so from December 2012 gender can no longer be taken into account when calculating a premium. This will particularly affect young women drivers, who traditionally enjoyed much lower premiums than males the same age.

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Where you live

Where in the country your car is kept, and whether it's on the street or in a locked garage, also affects your premium. Some areas have more car crime than others, and these places will see higher premiums. Similarly, a car parked out on the street is seen to be at more risk than one on a driveway, so will attract higher premiums.

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What you drive

It stands to reason that a very expensive sports car, which would cost a lot to repair or replace and is more likely to be driven fast, is more expensive to insure than a little 1.0 litre runaround.

What your car is worth is also another factor: clearly it will cost more to replace a £30,000 car than a £500 car. The insurance industry has set up insurance groups to decide which car falls into which group. Other things that can affect the premium are whether it's an import, if it's left-hand drive and if it's been modified (and that includes mods like wider wheels, as well as a tuned-up engine).

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Your job

Some professions are reckoned to pose a higher risk than others. That's because insurance companies keep a record of the professions of people involved in accidents, and have a database showing who's most likely to make a claim. Teachers, for example, are reckoned to be a good risk, but professional entertainers and footballers, publicans and bookies are all reckoned to be high risk.

You have to be honest, though. If you say you're a civil servant when you're really a pub landlord, you'd almost certainly find out that your insurance was invalid.

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Your experience

The longer you've been driving (usually) the less likely you are to have an accident. You've acquired the skills that help you minimise risks and cope with difficult conditions. So if you've been driving for years without making a claim, you should be entitled to a No Claims Bonus, which is a very effective way of reducing your premium.

You can also bring it down further still, by proving how good a driver you are. You can develop your skills and take a test with the Institute of Advanced Motorists and, if you pass, you could well get a discount on your premium.

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