There are few rites of passage as exhilarating as passing your driving test. The shackles of public transport, or worse yet getting a lift off mum and dad, are cast off and the world is yours to explore.
Of course, things like insurance don’t seem that big a deal, but young drivers’ car insurance can end up costing more than your first car. And even if you passed your test a few years ago and have been accident free, the cost of insurance can still be high for the under-25s.
It may sound condescending, but there is a lot of evidence that younger people take more risks than older people. According to research by the Transport Research Laboratory teenage drivers account for just 1.5% of motorists in the UK, but 12% of all accidents.
Younger drivers are more likely to take risks when driving because of their lack of experience, and they are also less likely to spot potential hazards. It all adds up to more expensive premiums. Other factors that affect young drivers’ car insurance costs include:
There are many elements about your car that will be taken into consideration when calculating your premium: its age, value, engine size, and the time and cost that repairs to the model typically cost. New, powerful cars will tend to be more expensive.
We’ve already seen that being young results in young drivers’ insurance being higher, but where you live, your occupation and whether you have any no-claim discount also play a part.
Car insurance comes in three flavours: comprehensive, third-party, or third-party fire and theft. Higher risk drivers often opt for third-party cover, resulting in more claims against this type of policy, which can make third-party cover more expensive.
When you take out your car insurance you will be asked to choose your excess. This is the amount of money you have to pay before the insurance company picks up the bill. The more excess you’re willing to pay the cheaper your premium will be. But remember to only choose an excess you can realistically afford.
A fast, flash car is the dream of many young drivers, but sadly these types of cars will be in higher insurance groups. More power and speed means an increased risk of accident, and accidents in fast cars tend to be more expensive than in slower vehicles. Also, fancy cars will always make more enticing targets for thieves. So while it may not have the same kind of street cred, a smaller car with a less powerful engine will be cheaper to insure.
If you can, make sure your car is parked off the road at night, and ideally in a garage, as this will keep your car insurance premium lower. Security devices such as an alarm, immobiliser and tracker will all help too.
Before you get your own car, consider being a named driver on your parents’ car. Often you can build up a Named Driver Discount, which you can transfer across when you then take out a policy of your own. This can help bring down the cost of a young driver’s car insurance.
Insurance costs for students will typically be high because they tend to be younger drivers. So, for the reasons above their premiums will be higher than older drivers.
Coupled to this is the fact that universities are located in cities (where crime rates are higher compared to small towns and rural areas), which means insurance claims are statistically higher. Areas that students live in often have higher crime rates than surrounding areas too. This puts their cars at increased risk of theft and vandalism.