Car insurance for new drivers can run to thousands of pounds – find out why, and how you can save money on new driver insurance
Car insurance premiums are based on certain facts. Given an insurer won’t know individual drivers needing protection, they base premiums on how likely it is they will have to pay out and how expensive a claim may be. They work out how much of a risk you are.
With no driving history, car insurance providers look at claims statistics, which reveal young and inexperienced drivers have more accidents than those who have notched up a few years’ experience, and young motorists tend to be involved in higher-value claims.
Generally, speaking, drivers have got safer in the past few years, with younger drivers showing the most improvement. However, they remain more likely to be involved in accidents than drivers over the age of 25 and more likely to cause injuries to third-parties.
Figures from the Department for Transport in 2018 show that around one in five new drivers are involved in a crash during their first year on the road.
Other reasons why car insurance is so expensive for new and young drivers include:
drivers aged 17 to 24 are three times more likely than those from other age groups to injure somebody in an accident
young drivers tend to travel with other young people in the car, and Government figures show that just over half of accidents involving drivers aged 17-19 resulted in injuries. This compares with one in five accidents where drivers were aged 60-69
injured passengers are classed as third parties meaning insurers must compensate for their injuries. Life-changing injuries cost insurers more the younger the injured person is because the victim must be compensated for the rest of their life
This is why new drivers are considered riskier and are charged more for car insurance than older and more experienced drivers.
Car insurance for young drivers will nearly always be more expensive than for any other age groups.
The cost of car insurance for 21-year-olds fell 7% to £118 per month during the first few months 2020, partly because fewer car journeys were being made as a result of the coronavirus pandemic. But it is still not cheap:
drivers aged 21 pay £1,525 on average per year
18 year old drivers pay the most, handing over an average of £2,134 per year for car insurance
Car insurance for young drivers will nearly always be more expensive, but there are things you can do to minimise the cost of your premiums:
choice of car: Each car is assigned an insurance group number from one to 50, with one being the cheapest to insure and 50 the most expensive. Driving a car in a low insurance group is the easiest way to reduce your premiums
adding a driver: You can add a second, low-risk driver to lower the costs of your car insurance. A lot of younger drivers include their parents. Another motorist cannot pretend to be the main driver – this is illegal and known as ‘fronting’
being a named driver: You can be a named driver on another person’s insurance policy and build up a no-claims bonus
There are occasions when multi-car insurance policies offer a really good deal. They are worth considering if:
Multi insurance might also be suitable:
you own more than one car
you’re a family with more than one driver
you’re a couple with more than one vehicle
You don’t need to own a car to require car insurance. If you are only planning on borrowing a car, or even if you have one tucked away on your drive with the required Statutory Off-Road Notice, of course, short-term or temporary car insurance, might be the ideal solution.
This cover option would allow you to drive for a limited period of time, with at least third-party cover, which could be handy if you are moving home or back from university.
There is a whole host of ways to prune the cost of your car insurance, if you know where to look. Try the following:
driving fewer miles: the less you drive, the lower your insurance premiums will be. When you apply for car insurance you will be asked how many miles expect to drive each year. out what you drive each year – your MOT certificate is a good indicator
shop around: when you start looking for car insurance make sure you shop around for cheaper new driver car insurance
pay upfront: you can also save on car insurance premiums by paying for 12 months’ insurance all at once. Remember that if you pay in monthly instalments you will have to pay interest on top of your monthly premiums.
pay a voluntary excess: paying a higher excess, which is the amount you have to pay when you lodge a claim before your insurer steps in, can reduce the cost of your car insurance premiums
keep your car insurance simple: unnecessary insurance add-ons can also increase the amount you pay. Breakdown cover is a good example. While you may need it, you may find it cheaper to buy it separately
being a safe driver: avoiding accidents means you will start to build up a no-claims discount, driving down premiums. Driving safely also means you avoid getting points on your licence, which can make insurance more expensive
take an advanced driving course: some insurers will cut the cost of your car insurance if you take an advanced driving course, such as the government-backed Pass Plus scheme or the IAM RoadSmart course
Black box or telematics insurance involve fitting a device to your car. This GPS-enabled device allows the car insurer to monitor driving behaviour. For example, acceleration, braking, cornering, miles covered and also what time of day you are driving.
The price of your insurance then goes down if you can prove you are a good, safe driver. However bad driving can result in your premiums going up and your insurance could even be cancelled.