Does your vehicle value affect your car insurance premium?

Does your vehicle value affect your car insurance premium?

When you get a quote for car insurance you’re always asked one question that most people think will make a big difference to their premium. Your vehicle value.

Contrary to popular belief, this can actually have very little impact on the final price. This is because a lot of people lie or miscalculate the vehicle value in one way or another. Often people will intentionally underestimate the value thinking it will result in a lower premium. Underwriters are wise to this and thus don’t give as much credence to them as you might think.

For instance, a lot of the people underestimate the value of their vehicle by a couple of thousand pounds in the hope it will reduce their pricing. Yet, this is rarely works.

This applies to our upcoming subscription product designed for infrequent drivers. If your car value is between £5,000-£10,000 it doesn’t affect your pricing at all. If it’s above £10,000 then it only makes up a small fraction of the price. The moral of the story is: be honest with the info you provide.