How To Save Money On Your Car Insurance As A Young Driver

By Bob Atoo
February 14, 2014

Car insurance can be a big expense for new or younger drivers. In fact, according to the British Insurance Premium Index, the average car insurance price for drivers aged 17-22 is a whopping £1,198.96!

But why is insurance so expensive for younger drivers? Put simply, it is because new drivers are statistically more likely to have an accident and may need to make an insurance claim than older or more experienced motorists. In fact, the RAC has reported that one in five young drivers will have an accident within six months of passing their test. This may be because of a number of factors, but it can predominantly be put down to less experience on the road.

Whilst it is unlikely that insurance for young drivers will become cheaper anytime soon, there are some easy ways to save money on your car insurance if you’re a new driver. I’ve listed some of the simpler ways of doing this that are likely to help bring your premiums down. Of course, it is dependent on the insurance provider you choose – which is why my friends at car insurance work with over 70 companies to get you their best price!

What car insurance do young drivers need?

Before we get into how you can save money on your car insurance, it’s worth going through what types of insurance you actually need as a young driver. In the UK, it’s against the law to drive without insurance, so it’s really important that you get the right cover for your needs.

Third Party:

This is the most basic type of car insurance and the minimum type of insurance required by law. It covers the damage caused to drivers vehicles if the accident is the fault of the covered driver. It doesn’t cover your car though if it’s stolen or damaged by fire.

Third Party Fire and Theft:

This offers a bit more protection, covering you just as Third Party car insurance would but including cover if your car is fire damaged or stolen.

Fully Comprehensive:

This is the widest level of cover, giving drivers full protection if their vehicle is damaged, another vehicle is damaged or your car is stolen or damaged by fire. There can be other extras too. For example, a fully comprehensive insurance policy might insure you if you drive another car or drive abroad. Not every fully comprehensive policy is exactly the same, so it is worth finding out what your chosen policy offers.

My friends at car insurance tell me that it’s worth bearing in mind that Third Party and Third Party Fire and Theft cover can be as little as £10 a year cheaper than Fully Comprehensive cover so always check this before you commit to lower policy benefits!

How to save money on your car insurance as a young driver:

There are a number of things you can do to reduce the cost of your car insurance premium when you first start driving. It’s a good idea to consider some of these before you actually buy your car, but there are a few simple steps you can take to reduce costs.

Choose your car very carefully:

The car insurance industry uses a Group Rating Table, which assigns different car models to different groups. Depending on what group your car is in, you are likely to pay either more or less on your insurance. The Group Rating Table ranges from 1-50, with 1 being the cheapest to insurance and 50 being the most expensive.

Think before you modify:
Car modifications can have a big impact on your car insurance premiums. Even additions like expensive alloy wheels can raise how much you pay because these may be more attractive to thieves, making a claim more likely. On the other hand, some modifications can lower the cost of your insurance premium. For example, adding parking sensors to your car may lower how much you pay. I’d recommend checking with your insurer before you make any modifications to see how it may affect your insurance policy. Additionally, if you have already modified your car, be sure to tell your insurer. If you don’t, it may invalidate your car insurance policy and leave you without cover altogether!

Build your no claims bonus:

A No Claims Bonus, sometimes called NCD, (No Claims Discount), basically refers to whether or not you have had to make a claim on your car insurance. Many insurance companies offer a no claims bonus or discount to customers who have not had to claim in a certain period of time, usually 12 months. Having a No Claims Bonus may reduce how much you pay on your premium in the long run. Of course, this isn’t much help for young drivers who are buying insurance for the first time but it’s worth bearing in mind for when you renew your policy.

Think about a black box:

The ‘black box’ or Telematics insurance has gained a lot of press coverage in recent years. Essentially, it’s a device (usually in the shape of a black box!) that is fitted to your car and monitors how you drive. It works through using GPS technology, like your Sat Nav, and monitors your speed, time of driving and braking speed. When these devices are fitted, it can help to significantly reduce your premium as a young driver. If you drive well, you are likely to reap the rewards.

It’s worth bearing in mind that the black box can work in the opposite way too. If the insurance company feels that you aren’t driving well, your premium may increase. In addition, Telematics insurance can have curfews attached as a policy condition. This means that you may not be allowed to drive between the hours of 11pm and 5am typically – so check that the policy terms are right for your lifestyle.

My friends at car insurance have the largest panel of ‘black box’ insurers in the UK so be sure to check them out!

Keep your car safe:

This is perhaps the most difficult thing to change if you want to save money. Insurance companies often look at where you keep your car in the day and at night  and may increase your premium if it looks like your car is at risk of being stolen or damaged. Whilst you’re unlikely to change where you live to save on car insurance, there are a few things you can do to reduce your premium. If you can, keep your car in a locked garage and make sure that it is secure at night. Failing that, you could fit good quality alarm systems or immobilisers (from a provider recognised by your insurance company) to your car. If you are thinking about taking your car to university, it’s worth checking what the area is like where your student accommodation is situated. If it is known to be unsafe, it may be better to leave your car at home. The greatest risk is having your car in public places for long periods of time.

Think about extra qualifications:

You know the phrase that “you don’t really learn to drive until you’ve passed your test”? Many insurance companies recognise that new drivers may not have experienced driving in all situations yet. With this in mind, your premium may be reduced if you take recognised extra driving qualifications. One of these is the Pass Plus Scheme, which is run by the DVLA. This qualification helps to improve your skills in areas like night driving, driving in hazardous conditions and motorway driving.

These are just a few ways of saving a bit of money on your car insurance as a young driver. It might seem unfair that younger drivers have to pay more on their premiums, however insurance companies charge according to risk. Statistically, younger drivers are more likely to claim and this is the reason why car insurance can be so expensive.

Nevertheless, if you think about the tips I’ve provided above, you may be able to save ‘abobatoo’ (see what I did there?). Don’t forget that you can connect with me on Twitter and Facebook, or via my contact page.