How to cut car insurance costs for young drivers

It’s a well-known fact that car insurance for young drivers is expensive. But there are ways to lower the cost without compromising on the car cover you need. Here, we explore why younger drivers pay so much more for insurance and what you can do to avoid paying over the odds.

Why is young driver’s car insurance so expensive?

Car insurance for young drivers under 25 is expensive because statistically, this group is more likely to be involved in an accident. This greater risk naturally increases the chances of a claim being made which is then reflected in the cost of premiums.

Recent data collected by NimbleFins highlights the differences between inexperienced younger drivers and those with more years behind the wheel. A 20-year-old male driving a Ford Fiesta can expect to pay an average of £851 for comprehensive cover. In contrast, a 25-year-old would pay £719 while someone aged 35 would pay £639.

What else affects the cost of car insurance for young drivers?

Your premium is calculated according to your risk profile. In other words – how likely are you to have an accident or make a claim. So, while age is a big factor in affecting what you pay, it’s not the only aspect insurers will consider – they’ll also think about:

Insurers will then use this information to work out your premium. For example, if you have an expensive or powerful car, drive 10,000 miles a year, and live in an area with a higher than average crime rate, you can expect to pay more compared to someone who drives just 5,000 miles a year in a cheaper car.

How can young drivers get cheaper car insurance?

Remember that cheap isn’t always the goal but good cover and value for money are. With that in mind, there are practical choices and decisions you can make to help you get the car insurance you need at a price you can afford.

Here are our twelve tips to getting cheaper car insurance if you’re a young driver:

1. Pay upfront

If you can, pay for your policy annually instead of in monthly instalments. Splitting out the cost by month might be convenient but you could end up paying interest which will increase what you pay overall.

2. Choose a telematics (black box) insurance policy

Telematics policies calculate your premium according to the way you drive instead of using industry statistics.

If you choose a black box policy, a telematics device will be fitted to your car and monitor the way you drive—specifically, your speed, cornering and braking. Telematics policies are usually cheaper than regular policies. And if your driving is consistently good, you could find your premiums are lowered as a result.

3. Add a named driver

Adding a more experienced, older driver to your policy can help lower your premium. This is because it’s assumed you won’t be the sole driver which minimises your time behind the wheel and mitigates the risk of an accident.

However, don’t fall into the trap of fronting and be tempted to list the named driver as the main driver in order to get cheaper car insurance. Fronting is insurance fraud so not only will it invalidate your policy, you’ll be committing a crime too.

4. Choose a cheaper car

All cars belong in one of 50 car insurance groups. These are based on value, engine size, the cost of repairs and parts and safety features.

Generally, the lower the group number, the lower the insurance. So, if you’re lucky to be buying your own car, choose it carefully and check which group it’s in.

5. Consider all levels of cover

Historically, third party policies tended to be the cheapest but that’s no longer the case. This is because over time, insurers realised that third party policyholders made more claims compared to comprehensive policyholders.

As a result, premiums have been amended to reflect that change and comprehensive insurance is often the best priced, despite providing the highest level of cover.

6. Increase your excess

The excess is an amount you have to pay in order for a claim to go ahead. There are two types of excess:

You must pay both excesses, but you have the opportunity to negotiate your voluntary excess. Increasing this amount can lower your overall premium but remember that it still needs to be affordable. If you can’t pay it, your claim won’t proceed.

7. Increase security

Cars that are harder to steal (or vandalise) typically cost less to insure. If you don’t have a lockable garage or a private driveway to park your car, adding extra security can help. For example, using an immobiliser such as a steering wheel lock.

If you choose to add-on security devices, look for those approved by Thatcham who are experts in car safety and security.

8. Amend your job title

Modifying your job title can also lower your premium as some careers are considered ‘riskier’ from an insurance point of view. Needless to say, the job title you choose still needs to accurately reflect what you do. But, for example, if you’re a nurse, it could be worth checking whether what your options are – for instance, ward sister, theatre nurse, intensive care nurse, as this could affect your quote price.

9. Only buy what you need

Insurers will offer several add-ons such as breakdown and recovery services or European cover. Optional extras are useful and a ‘nice to have’ but if you don’t use it, it’s a false economy.

You might also find that popular extras such as breakdown insurance is cheaper if bought as a standalone policy. Some banks also include it as part of their current account extras, so check whether you might already be covered.

10. Never auto renew

Sadly, loyalty won’t save you any money so don’t assume auto-renewing will give you the best price. You should always compare quotes a few weeks before your existing policy ends so that you’ve got enough time to consider all your options.

11. Consider a multi-car policy

If you live with your parents or house share with other car owners, a multi-car policy could also help shave a little off your premium. A number of insurers offer discounts for each additional car added to a policy so it’s worth discussing this option with housemates or your mum or dad.

12. Complete an advanced driving course

Some insurers will discount your premium if you’ve completed an advanced driving course.

Not all insurers will offer this and if they do, not all courses will entitle you to reduced premiums. But, if budget is your focus, speak to your insurer to see what courses they recognise and how much it might reduce your premium by.

Compare car insurance quotes for young drivers

To help you find car insurance that fits your needs and your budget, we’ve teamed up with Quotezone. Filling in one form could generate up to 60 car insurance quotes, enabling you to find great value cover for your peace of mind.