The Cost to Insure New and Teenage Drivers

Why is the cost of car insurance for newly licensed drivers so expensive? Is it fair to judge that these drivers are high risk because their experience is minimal?

The answer is yes.

Insurance companies agree newly licensed drivers pose the most risk of any group of drivers. New drivers are still learning and will be most likely to be involved in accidents at some point during their first year of driving. The risk of an accident where someone is injured or killed is seven times greater between the ages of 17 and 20 than any other group - newly licensed drivers cause 29% of accidents. These are a few of the reasons why insurance premiums are so expensive for a new driver.

New and teenage drivers can lower their insurance premium with the new policies many car insurance companies have begun adopting. For example, raising the excess (deductible) to £1,000 can help new drivers with their no claim discount. You might also consider the pay as you drive policy. This allows 18-21 year olds to pay only for the mileage actually driven, and tracks the place and hour of day the car was used.

Useful tips

· Some tips to consider when new drivers are shopping for car insurance are to consider adding a parent onto the policy. This tends to drop the premium 10-15%.
· Think about paying more than the standard excess
· Ask if there is a monthly installment payment plan to pay your premiums; if so, are there extra fees involved?
· Any extra features added to the car for security will automatically give a discount. An approved anti-theft car alarm or an immobilizer greatly helps the insurance company locate your car if stolen.
· If the car is driven minimally, tell the insurance company; this will lower the premium as well.
· Garaging the car also helps in lowering the yearly premium for new drivers.
· Don’t forget to shop around and it’s a good idea to make a list of everything you want in a car insurance policy and then choose the company that fits your individual needs.

New and teenage drivers should consider getting their own policy rather than using their parents’ - to be able to build up their no claims bonus, which will give them a discount after a year. Also, if the new driver takes the Pass Plus driving course, many insurance companies will give a 35% discount on the first year rate.