Cheap car insurance for young drivers

Do young drivers need insurance?

So, you’ve passed your test, bought your first car, and now you’re ready to hit the road, right? Well, not quite. Insurance might be the last thing on your mind but it’s important you don’t forget it. In fact, it’s illegal to drive without insurance! You must secure car insurance before you start driving, even if you’re still a learner.  

If you don’t own your own car but plan to drive your parents’ vehicle instead, you could ask them to add you to their insurance policy instead. This could be cheaper than having your own young driver insurance but will likely increase the cost of their premiums.

Types of car insurance for young drivers

There are three main types of car insurance that you could consider buying as a young driver:

Fully Comprehensive

The most all-inclusive coverage you can buy, fully comprehensive insurance protects you, your vehicle, and other drivers from any damage that you cause as well as repair costs, medical expenses, fire damage, and theft of your vehicle.

Third-Party Fire and Theft

The next level down from fully comprehensive, third-party fire and theft insurance will cover costs for other people, their cars, and their property, but it’ll also cover your vehicle if it’s stolen or damaged by fire.

Third-Party

Third-party insurance is the minimum insurance required for motorists as it only provides coverage for damage caused to other people, their cars, and their property.

What optional extras can I purchase?

Car insurance isn’t a one-size fits all. Depending on your circumstances, how and when you drive, and the type of car you have, you might need different things from your policy.

If you’re prepared to stretch your budget and pay a slightly higher premium, you could opt for:

• Breakdown cover to help you get back on the road straightaway
• Personal accident cover to compensate you for an injury
• Motor legal protection if you’re involved in an accident dispute
• Lost keys cover if you’re the forgetful type
• No claims discount protection if you’re proud of the years you’ve built up
• Windscreen cover for any flying debris or cracks caused by passing vehicles

How much does young drivers’ car insurance cost?

You might be surprised by just how much young drivers’ car insurance could set you back. And third-party insurance can sometimes be the most expensive option! According to data from MoneySuperMarket, the average cost of third-party insurance for drivers aged between 17 and 24 is higher than fully comp.

The youngest drivers – typically aged between 17 and 19 – will usually pay the most each year with an average annual premium of £1030. Those aged between 20 and 24 will save around £300 with an average premium of £965.

Why is young drivers’ insurance more expensive?

If you’re wondering why young drivers can face a bill of over £1000 a year for insurance, there are a few reasons why youth isn’t on your side.

Unfortunately, the statistics paint a worrying picture. Younger drivers are much more likely to get into a serious accident so they’re a high-risk group. 47% of reported road accidents in the UK involving drivers aged between 17 and 19 resulted in casualties.

And it’s not just the increased likelihood of getting into a serious accident that pushes up young driver premiums; it’s estimated that one in ten new drivers has a crash within the first six months after passing their driving test.

It probably won’t surprise you to learn that inexperienced drivers end up in more accidents, but new drivers can also be guilty of ignoring the rules of the road and putting themselves in even more danger. According to a 2018 Department of Transport report, 10% of new drivers are caught committing a driving offence in the first two years of driving.

New drivers also won’t have time to build up a no claims bonus to demonstrate that they’re capable behind the wheel and cut their insurance costs.

The good news is that this won’t last forever. If you’re a safe driver and you don’t make any claims, car insurance typically starts getting cheaper when you hit your mid-20s.

How to get cheap car insurance for young drivers

Reduce your mileage

Not only could limiting the number of miles you do help to reduce the cost of your insurance premium, but it could also make you less likely to get involved in an accident as you’re spending less time on the road.

Add named drivers to your policy

Adding an experienced additional driver to your policy can help you save money as the insurer can be reassured that someone with a few years under their belt will also be driving the car. However, you must not claim that the older driver will be the main driver if that isn’t true – this is known as fronting and is a criminal offence.

Shop around

When looking for cheap car insurance, it can pay to shop around. Check out price comparison sites as well as insurers who offer exclusive rates and specialise in young drivers’ car insurance. Don’t forget to visit cashback sites either as you could receive a percentage of your premium back when you shop online.

Pay annually

It’s not always easy to pay the full amount upfront but splitting the cost of your insurance into monthly payments can make it more expensive overall. If you have savings available to cover the full annual premium, then you could save a few pounds.

Keep your car secure

Storing your car in a locked garage or secure parking spot overnight could also help cut the cost of your insurance as it makes it more difficult for thieves to access your vehicle.

Increase your excess

Just like paying for your insurance upfront, increasing your voluntary excess isn’t an option that’s available to everyone. If you can afford to put £300 or £500 towards a repair, this could help reduce your overall premium. Increasing your excess assures ensures that you won’t make an unnecessary claim but make sure it’s still an affordable amount, just in case.

Drive carefully

While it might not save you money just now, being a careful driver can help you start building a no claims bonus that lowers your premiums next time around. Considerate driving that avoids penalty points and speeding fines will also be essential if you’ve opted to take out black box insurance.

Avoid modifications

You might have been looking forward to pimping your ride as soon as you passed your test but modifications like an expensive stereo system or custom spoiler could catch the eye of a passing thief and put your car at risk. The higher the risk, the more expensive the insurance.

Invest in extra security

While some modifications can make your car more tempting to opportunistic thieves, there are some additions that can help keep it safe. Consider fitting extra security measures like an alarm or immobiliser to reduce your insurance costs and protect your vehicle.

Be honest

While it might be tempting to claim you rarely drive or that you keep your car in a locked garage every night instead of out on the road, you should always be truthful when applying for car insurance. If you’re found to have been lying then it could invalidate your policy and leave you unprotected.

Should I choose black box insurance?

Black box insurance, also known as telematics cover, is when an insurer offers you lower car insurance premiums based on data collected while monitoring your driving habits.

There are three pieces of tech that you might be offered: a black box, a plug-in device, or an app that you install on your mobile phone.

Different insurance providers will collect and analyse different data points. Factors that could influence the amount you pay include when you drive, how many miles you drive, how you corner, your average speed, and how hard you brake.

But will a black box give you the cheapest insurance for a car? Well, it might not reduce your payments straightaway but if you consistently drive safely and sensibly, you could earn a discount over time.

However, if you’re a nervous driver, regularly push the speed limit, or think you might end up in an accident, having a black box installed could increase your insurance premiums. Terms and conditions can also apply; you might be asked to restrict your mileage or have a curfew that limits the hours you’re allowed to drive to qualify for cheaper insurance.

Can advanced driving courses help me secure cheap car insurance?

As a new driver, you might be tempted to book onto an advanced driving course like Pass Plus. These courses can help build your confidence, give you experience driving in a range of different conditions, and sharpen your skills but they won’t necessarily get you the cheapest car insurances. Even so, advanced driving courses can help you become a better drive, which makes you less likely to end up in an accident and helps you build a no claims bonus over time.

What are the cheapest cars to insure?

When it comes to securing the cheapest insurance for car finance, a good rule of thumb is that smaller, less powerful cars offer the lowest premiums. There are 50 different insurance groups in the UK that determine how much your insurance might cost based on the perceived risk. A car’s insurance group is also influenced by the average cost of repairs, any built-in security systems, its price, and its performance. Choosing a car from a lower insurance group can help you save money as these cars are typically safer to drive. Newer, more powerful cars will usually drive your costs up, no matter your age.

When it comes to specific makes and models, according to Compare the Market data, the cheapest cars to insure are:

Citroen C1

A great city car with a distinctive design, the Citroen C1 has plenty of character and refreshingly low running costs.

Peugeot 107

The Peugeot 107 is the perfect first car – it’s easy to drive, can take on corners and narrow streets with ease, and is reassuringly reliable.

Ford Ka

If you’re still getting the hang of parallel parking, the Ford Ka will fit into almost any space, offers great fuel economy, and is still fun to drive.

Fiat 500

The Fiat 500 is one of the most recognisable cars on the road with a classic sense of style, refined interior, and impressive built-in tech as standard.

Toyota Aygo

Another compact city car that makes the list, the Toyota Aygo is agile, has a bold design, and always stands out from the crowd.

Can I get car finance as a young driver?

Unfortunately, securing car finance as a young driver isn’t always easy but it’s not impossible! When you apply for a loan with CarFinance 247, we’ll always look to find you the best deal from our panel of lenders. And thanks to our lending panel, we can help younger drivers find finance. You might even be able to find a loan without needing to put down a deposit.

There are several types of car finance available including:

Hire Purchase

Hire Purchase or HP car finance splits the cost of your new car into affordable monthly payments over a set loan term. Once you reach the end of your agreement and pay the ‘Option to Purchase’ fee, you’ll own the car.

Personal Contract Purchase

With Personal Contract Purchase or PCP car finance you have options at the end of your agreement. You can choose to hand the car back, buy it by paying the one-off balloon payment, or use any positive equity as a deposit in a new deal.

If you’re struggling to secure car finance as a young driver on your own, you may also be able to apply for joint car finance.