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Whether you’re buying your first car or looking to borrow someone else’s, if you’ve just passed your test you need car insurance.
Unfortunately, new driver insurance can be quite expensive due to your lack of driving experience. But having cover in your name will enable you to build up a no-claims bonus (NCB), which can mean access to cheap car insurance in the future.
New driver insurance is car insurance suitable for people who have recently passed their driving test. New drivers can apply for standard car insurance or specialised products designed for new or young drivers.
Whatever type of car insurance you choose, it’s important to understand the different types of car insurance and what is covered by each type.
Third party: this is the minimum level of cover you legally need. It covers damage to other people’s vehicles and property, and injuries suffered by other people. However, if you cause an accident, third party insurance won’t cover damage to your own car or your injuries. It also won’t pay out if your car is stolen or damaged by a fire
Third party, fire and theft: if you take out third party, fire and theft insurance, it’ll include third party cover but will also payout if your car is damaged or destroyed by fire, or stolen
Fully comprehensive: the highest level of car insurance, fully comprehensive, covers third party, fire and theft, but it also includes damage to your own car and your own injuries. This means you can claim for repairs to your car after an accident and your own medical expenses, even if the accident was your fault. A full comp policy might also include cover for vandalism and legal expenses
It can be tricky to find cheap insurance for new drivers. This is because young or new drivers are statistically more likely to be involved in an accident due to their lack of driving experience.
For example, the average fully comprehensive car insurance policy for a new driver who has held a licence for less than 12 months cost £1,533. That’s based on policies purchased from MoneySuperMarket between July and September 2023.
A third party policy cost on average £1,537, while third party, fire and theft was the cheapest at £1,310.
How much new drivers pay for car insurance will depend on various factors, including:
New driver insurance usually costs more than learner driver insurance. Learner drivers on a provisional licence are always driving under supervision, which means they are less risky for insurers.
New drivers who have passed their test can drive alone – but a lack of experience means this demographic presents a higher insurance risk. For example, according to the Association of British Insurers (ABI), drivers aged 17 to 24 only make up 7 per cent of UK licence holders and drive fewer miles than average, but this age group is involved in 24 per cent of all fatal collisions.
This also means that younger drivers – who make up the largest portion of new drivers – have been hit the hardest by rising car insurance costs. The latest data from Consumer Intelligence shows that quoted premiums rose 73.1 per cent for under-25s in the year to November 2023, compared to 57.2 per cent for drivers over-50.
We’ve compiled 10 tips for how you can try and reduce the cost of your cover, and get the cheapest car insurance for new drivers available.
When buying your first car check which insurance group your intended purchase falls into. All cars are categorised into insurance groups from one to 50 – the more powerful and expensive your car, the higher the insurance group and the more you’ll pay. Cars such as the Fiat Panda, Ford Ka Plus or Nissan Micra are in Group 1, and so are the cheapest to insure. If an older or second-hand car is purchased, the insurance premium might be lower as a result of the lower value of the car itself. However, this won’t apply universally.
The excess on your policy is the amount you’ll need to pay towards any claim. All policies have a compulsory excess; adding a voluntary excess too can lower your premium.
If you can afford to, it’s best to pay your car insurance premium in one go each year. Most insurers offer the option to pay monthly, but this works out more expensive.
You’ll need to state your estimated annual mileage when you buy car insurance. It might be tricky to estimate this figure as a new driver but bear in mind that low mileage means fewer chances of an accident, and, in turn, lower premiums.
Insurers don’t like modifications, such as spoilers and tinted windows – these changes to your car will result in higher premiums.
Having an immobiliser or tracker in your car can reduce your insurance premium as there is less chance of it being stolen and an increased chance of recovery if it is. Dash-cams can be useful to prove what happened in the event of an accident.
It’s important for new drivers to build up a no-claims bonus (NCB) – you can do this by driving carefully and not making any claims on your policy. A NCB means your insurance will be cheaper when it’s up for renewal. Keeping a clean licence will help too, as speeding and motoring convictions mean paying more for insurance.
This is an advanced driving course which teaches drivers to improve their skills and drive more safely. Once you’ve completed Pass Plus and got a Pass Plus certificate, you will qualify for a discount from some insurers.
When you’ve had your own car insurance policy for a year your insurer will send you a renewal quote – but you don’t have to accept this. Instead compare prices elsewhere and make sure you state you have a NCB if yours is still intact.
It’s best to buy car insurance about three or four weeks before your renewal is due – studies show that drivers who leave it until the day their insurance is due for renewal could pay
Use a price comparison site to compare new driver car insurance quotes from different insurers. Premiums can vary considerably for new drivers as some insurers are keen to have these customers while others purposefully price themselves out of the market.
You don’t have to take out a standard annual car insurance policy as a new driver. There are a number of specialist options that could either save you money, or better suit your needs:
With a telematics or black box car insurance policy, your insurer will monitor your driving habits via a device fitted in your car. Drive well and you’ll get cheaper cover.
New drivers can reduce their car insurance premiums by adding an adult (for instance, one or both of their parents) as a ‘named driver’ on their policy. However, it’s important to be honest about who actually drives the car the most – lying to get cheaper premiums is known as ‘fronting’ and is illegal.
If you only need to drive in short bursts, you could consider temporary car insurance. This will allow you to take out insurance for as little to one hour, up to a few months. Importantly, if you were to get in an accident, it wouldn’t affect the no-claims bonus of the car owner.
Sometimes called pay-per-mile insurance, this type of policy charges you a set rate for insurance for each mile you drive. Your distance is measured by a telematics device in your car. Pay-as-you-go car insurance can work out good value for occasional drivers, but might be costly if you need to ramp up your mileage
An alternative to pay-per-mile insurance, if you drive less than 6,000 to 7,500 miles a year, you could consider a low-mileage car insurance policy. These policies are typically cheaper than standard cover, as it indicates you are on the road less, and therefore a lower accident risk.
“It might be worth considering getting a telematics policy, where the insurer instals a box in your car to track your driving. If you drive sensibly, you should start to see some financial reward for this. If you’re only planning on driving occasionally, it may make sense to avoid an annual policy altogether. A new breed of insurers offers cover by the day or even by the hour. If you do have your own car and will be the main driver, it’s important not to let your parent put themselves as the main driver on the policy. This is called “fronting” and is illegal. It could invalidate your insurance altogether if the insurer finds out.”
Car insurance policies vary regarding what they cover for new drivers. Some of the things below will be covered as standard on new driver insurance policies, while others can be covered for an extra fee.
When choosing a car insurance policy as a new driver, think about the additional cover options that will be most useful for you:
When you apply for your first car insurance policy, the price comparison site or insurer will ask questions about both you and your car.
Here’s what you need to tell them about:
| Your car | You |
|---|---|
| Make and model | Name and date of birth |
| Value | Address |
| Year of registration | Type of driving licence and the year you got it |
| Registered owner and keeper | Driving convictions |
| Security and modifications | Occupation |
| What you plan to use the car for (social/commuting) | Details of previous car insurance claims (for instance, while learning) |
| Engine size and number of seats | Named drivers |
| Predicted annual mileage | Homeowner status |
| Where the car is kept during the day/overnight | Marital status/dependents |
Here’s what to look for when comparing new driver car insurance quotes:
| Factors to consider | What it means |
|---|---|
| Level of cover | Third party/ third party fire and theft/ fully comprehensive |
| Premium | Annual cost of the policy |
| Total excess | Amount the policyholder pays in the event of a claim |
| Optional extras | Add-ons such as legal expenses, windscreen cover and personal belongings |
| Courtesy car | A car you can drive while yours is being repaired in the event of a claim |
| Breakdown cover | Assistance if your car breaks down on the road/at home |
| Legal expenses | Financial protection against legal fees if you’re involved in an accident that’s not your fault. For instance, personal injury, excess recovery, loss of earnings |
| Personal accident | Provides you or your family with financial support if you’re injured or die in an accident |
| Telematics | A black box fitted in your car to monitor your driving |
All mainstream insurers offer cover to new drivers. There are also a number of specialists who focus on new drivers. These include:
Assuming you don’t make any claims, your car insurance should get cheaper each year as you get older, and also as you build a NCB. Some telematics policies will lower your monthly premium if you have driven well the previous month.
New drivers can be added to other people’s car insurance policies as a ‘named driver’. However, adding a new driver to their policy could result in paying more for cover as inexperienced drivers present a higher risk to the insurer.
Telematics insurance can sometimes be a good value option, but it won’t necessarily be the cheapest car insurance for new drivers. It depends when (the time of day) and how well you drive. When comparing car insurance quotes, you should look at both standard and telematics car insurance policies.
Some insurers offer a discount if you take an advanced driving course such as IAM RoadSmart’s Advanced Driver Course or the DVLA-endorsed Pass Plus course. But this doesn’t necessarily mean that the discounted premium will be the cheapest option for you – you should still carry out a full car insurance quote comparison to find the best value deal.
