Is multi car insurance worth it? How to decide

If your household owns more than one vehicle, you may be wondering, “Is multi car insurance worth it?” and “Do you save money on multi car insurance?” While it does often work out cheaper, this isn’t always the case. And of course there are various other pros and cons to weigh up as well.

Let’s take a look at the different factors at play and help you decide.

Is multi car insurance an option for you?

First things first, are you actually eligible for multi car insurance? Well, if your household has two or more cars registered at the same address, then the answer is yes! Whether you’re a family with multiple vehicles, a couple who use each other’s cars, or an individual who owns more than one motor, multi car insurance is definitely something to consider.

And you don’t have to be related. As long as the cars are registered at the same address, anyone can take out a multi car policy. This includes housemates and students sharing a home.

The pros and cons of multi car insurance

As with any type of insurance, there are advantages and disadvantages to consider before making a decision. When it comes to multi car insurance, it’s worth keeping in mind that some of the pros and cons will vary depending on the type of cover you get. There are two main types:

• Linked policies: When every car has its own individual but linked policy, you can choose different cover levels, excesses, and insurance add-ons for each vehicle. The renewal date for each car can also be different. 
• One single policy: When every car is insured under one single policy, they’ll usually all have the same level of cover, excess, and add-ons. The renewal date will also be the same for each car. 

So, with this in mind, here are our picks for the pros and cons of multi car insurance.

What are the benefits of multi car insurance?

Multi car insurance has plenty of pros, including cost savings and convenience.

• Multi car discounts. Is multi car insurance cheaper? Yes, usually it is! One of the key incentives for taking out a multi car insurance policy is that many insurers will offer a multi car discount. Often, they’ll give you more of a discount with each car you add, for example 10% per vehicle, which means your savings can really rack up. 

• Other cost savings. Most multi car policies will let you keep or build up a no-claims bonus on each vehicle. Having multiple no-claims discounts on one policy can help lower your premiums. And the mix of drivers on the policy can also work out cheaper. For example, including more experienced drivers on a policy with less experienced drivers can help drive down costs overall. 

• Convenience. If you’re responsible for managing multiple car insurance policies, it can quickly get a bit overwhelming. But with multi car cover, you’ll only have to think about one policy and one insurance provider. And with a single policy (rather than linked policies), you won’t even have to keep track of different renewal or payment dates, as all your vehicles will renew at the same time.

• Separate no-claims bonuses. If you’re wondering, “Do you get no-claims on multi car insurance?”, the answer is yes, you do. And alongside being able to have a no-claims bonus on each vehicle, most insurance companies will also treat these bonuses separately in the event of a claim. (Always check this with your insurer before taking out a policy to make sure you don’t get caught out.) If one car is damaged or stolen and loses its bonus, the discounts of the other cars usually won’t be affected. 

• Special options. Each insurer will have their own set of benefits and offers. For example, some will allow you to include vehicles that are registered at the same address but spend a lot of time away from home, which is a great option for families with a child at university. Some will even let families include vehicles not registered at the same address. And the odd provider will let you add vans as well as cars. It’s always worth shopping around for the best offers and deals.

What are the disadvantages of multi car insurance?

While there are certainly lots of great benefits, multi car insurance isn’t always the best option.

• Joint renewals. If you have a single policy, all your cars will renew on the same date. Lots of people find this handy, because it means they only have to think about their car insurance once a year. But it’s worth keeping in mind that this means paying for all cars in one go as well. This can be a bulky sum, and the alternative of paying monthly usually has added interest. If you’re concerned about affordability, linked policies might be better for you as each car can have a different renewal and payment date. 

• Less flexibility. Another issue with having one single policy is that the level of cover, excess, and add-ons usually has to be the same for each car. This gives you less flexibility than standalone car insurance would. But linked multi car policies will usually let you set different options for each car, so if you’re keen on flexibility, linked policies are likely a better choice for you.

• Linked no-claims bonuses. It’s not that common, but sometimes if one car loses its no-claims bonus, all other cars on the policy will too. And even if your bonuses are treated separately, one driver making a claim could bump up everyone’s premiums due to the loss of one no-claims discount.

• Joint premiums. Like with joint renewals, lots of people like having one single premium because it’s less to think about. But joint premiums can work out better for some people on the policy, and worse for others. Below, we look at some situations to think about where sharing premiums with others might put you at a disadvantage.

Situations where multi car insurance might not be the best option

There are many factors that go into determining the price of insurance, and multi car cover is no different. Depending on your exact circumstances, these factors could mean multi car insurance isn’t actually worth it for you.

Other drivers

Younger drivers, inexperienced drivers, and drivers with histories — like claims, points on their licence, or offences — will hike up the price of premiums. So if you’re an older or more experienced driver with a clean record, multi car insurance might be more expensive for you than taking out your own policy.

This isn’t always an issue — for example, multi car insurance can be a great option for parents and children, especially if the parents would be paying for their kids’ insurance anyway — but it’s definitely one to consider.

Other vehicles

All vehicles are placed into one of 50 different insurance groups. Cars in higher groups, like bigger and modified cars, will also bump up the price. If you’re in insurance group 1 and everyone else on the policy would be in insurance group 50, you might be better going it alone.

Similarly, if just one car would increase your premiums — for example a high performance or classic car — you could consider getting specialised insurance cover just for this vehicle, and then putting all your other cars under a multi car policy.

Number of cars

Another situation to think about is the number of cars you’re planning to put on your multi car policy. Because insurers often give more of a discount for more vehicles, multi car policies tend to be more cost effective for those insuring several cars. If you’re only putting two cars on the policy, it might make multi car insurance less worth your while.

How to decide if multi car insurance is worth it for you

So with all these variables, how can you be sure you’re making the right choice? First, consider the cons, and see if any are deal breakers. If not, for most people the question will ultimately come down to whether multi car insurance works out cheaper than standard insurance.

The best way to decide is to work out how much it would cost to insure all your cars on separate policies, and then how much it would cost to insure them altogether. If doing it together works out cheaper, multi car insurance is probably the best option for you. And regardless of your policy, it’s worth doing this comparison every time your cars come up for renewal to make sure you’re still getting the best bang for your buck.

How to compare different policies

First off, work out the levels of cover, excesses, and add-ons you’d like for each vehicle. Make sure you apply these consistently throughout for an accurate comparison. Next, have a look at how much it would cost to insure each car individually, and make a note of the prices. Then, find out the cost for a multi car policy and compare the two.

With multi car quotes, insurers will usually give you an initial price and an “annual equivalent price”. The initial price will be cheaper if not all your cars would join the multi car policy immediately. Most insurers will let you stagger joining so that you don’t have to cancel your existing policies.

So you might add one or two cars to begin with, and then additional cars when they come up for renewal. These additional cars wouldn’t pay full price for the first year. As the initial price may well be different, having the annual equivalent price means you can still compare like for like with standard policies.

When looking for quotes, comparison sites can be a good option, but it’s worth bearing in mind that they tend to show fewer results for multi car policies. Contacting the insurance provider directly can work better for multi car quotes.

Or you can use a trusted insurance broker — like us! — to do the hard work for you and find the best deals. Get in touch with the expert team at Howden today and make the most of our personalised service.

Also read:

• How much is insurance for a new driver?
• The price of insurance – higher, lower?
• Why is van insurance so expensive?
• Can you use a no claims bonus on two cars?

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