How can young drivers lower their car insurance?

How can young drivers lower their car insurance?

author: Bryony Pearce

By Bryony Pearce

From avoiding modifications and choosing the right type of car to driving less and increasing your excess, we’ve got 10 tips that’ll help to lower the cost of your car insurance.


So, you’ve just passed your driving test and you’re on top of the world, but before you can get behind the wheel, you’ve got to negotiate the costly world of car insurance.

Unfortunately, young drivers get bad press and according to statistics, they’re more likely to be involved in driving-related accidents, which pushes all young drivers’ car insurance premiums sky high.

But it’s not all doom and gloom, we’ve put together top 10 tips to help young drivers lower their car insurance.

1. Think about getting a black box

Sometimes referred to as telematics, black box policies work by installing a small device in your car which is run via an app and monitors your driving behaviour and habits.

These kind of policies are ideal for young drivers because the cost of your car insurance will be determined by your actual driving behaviour, rather than tarring all youngsters with the same brush. The reason for this is because insurance providers can base their premiums on real-life data rather than assumptions.

How much could you save?

According to a study by uSwitch, young drivers between the ages 17 and 21 could save an average of £1,282 on their premiums by having a black box installed, compared to a standard cover price.

2. Choose a cheap car to insure

Whether you purchase your car before or after you’ve passed your test, an important thing to consider is the impact your choice will have on your car insurance cost.

Any car on the market will belong to one of 50 car insurance groups, and for new drivers, it’s particularly important to choose a car from the top five groups to avoid overpriced car insurance premiums.

It all boils down to the costs of repairs and parts, the value of the car, car security and the car’s performance. The more expensive the repairs are likely to cost the higher the insurance, or conversely, the better the built-in security features the lower, for example.

TIP: if you’re unsure what band of insurance the car you’ve got your eye on falls into, stick the car make and model followed by ‘insurance group’ into google to find out if it’s a good option for you before taking the plunge.

3. Avoid car modifications

Cars with modifications are a big red flag to insurance providers and can increase your premium by hundreds of pounds. One recent study found an increase in car insurance premiums of anywhere between 8% and 132% depending on which modification was carried out.

Alloy wheels, spoilers and body kits can be appealing to personalise your car and add to the excitement for some young drivers, but in the eyes of the insurers, they may worsen the performance of your car and increase the risk of accidents. There’s also an increased risk of your vehicle being stolen or broken into if you have modifications.

All in all, it adds up to more expensive car insurance. So, if you’re looking to keep your premium to a minimum, avoid modifying your car or purchasing a car that’s already had modifications done to it.

4. Increase your excess

This comes with a big stipulation, and that’s if you can afford it.

By choosing to pay more in your voluntary excess you could quite significantly reduce your insurance premium, however, only ever increase your voluntary excess to a level you can realistically afford. Should you find yourself in the unfortunate position of needing to make a claim, you’ll have to be able to find the excess before your insurance company will stump up the rest.

5. Pay annually, if possible

Again, this is only an option for some people, but if you can afford to pay your car insurance off in one go you’ll save money in the long run.

This is because when you choose to pay monthly you’re essentially taking out a loan for your insurance and therefore will be charged interest, typically around 20%.

With monthly instalments, you’re normally expected to pay a deposit upfront (of around 20%) followed by 10 or 11 monthly payments. If your annual premium quote is £2,000, for example, paying monthly could see you repaying a whopping £320 in interest over a 12-month period.

6. Consider adding a named driver

You could reduce your costs by adding a named driver to your car insurance policy, particularly if they’re an older and more experienced road user (avoiding anyone with driving convictions).

But a word of warning, putting yourself as the named driver and your parent as the policy holder, despite you really being the main driver, is illegal. This is known as ‘fronting’ and could result in any claim made to your insurance being rejected.

7. Look at level of cover

There are three main bands of car insurance; comprehensive, third party fire and theft, and third party, and they’re typically priced in that order.

- Comprehensive cover will cover your car and anyone in it, as well as other cars and passengers involved in an accident.

- Third party fire and theft covers any damage to a third party or their vehicle (but not your own), as well as fire damage or theft of your vehicle.

- Third party cover simply covers any damage to a third party or their vehicle in the event of an accident.

It's wise to work out which level of cover meets your needs best rather than focusing entirely on price. But, if you think one of the cheaper levels is suitable for you, you could save yourself money on your insurance premium.

8. Compare the market

Having read about the different levels of cover, don’t assume third party cover will be the cheapest if you’re a young driver.

Research by the Association of British Insurers shows that the average comprehensive cover is actually cheaper than third party, fire and theft, because young drivers opt for it more and are more likely to make the largest claims.

It pays to compare the market and look at quotes with different levels of cover before you make your decision, and you could actually end up paying less for a policy that gives you more – win, win!

9. Boost your car’s security

This is one modification that’ll work in your favour. Fitting extra security features, like an immobiliser or alarm, will typically help to secure cheaper car insurance.

Another simple fix to reduce your premium includes parking your car on a driveway or in a garage rather than on the road.

10. Drive less

It’s probably the last thing you want to hear, but the lower your mileage the cheaper your car insurance quote.

When deciding whether to drive somewhere or take public transport or even car share, particularly on longer journeys, factor in the savings you’ll make on your car insurance as well as the cost of fuel vs fares.

Disclaimer: All information and links are correct at the time of publishing.

author: Bryony Pearce

By Bryony Pearce

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How can young drivers lower their car insurance? How can young drivers lower their car insurance?