Get ready for a big bill – car insurance for new drivers is very expensive! Luckily there’s some options to make it cheaper such as black-box insurance, and you just can’t beat spending some time shopping around. But don’t worry, it gets cheaper over time.
New driver? Don’t fret, we’ve got you covered. Getting the right car insurance for a good price is easier said than done, but luckily we’re behind the steering wheel.
What actually is car insurance?
Insurance is super boring, but a legal requirement so it’s not something you can avoid. You can insure you, your vehicle, other drivers and their vehicle(s), incase you have an accident or cars are damaged from vandalism, and theft. And what do we mean by insurance? Well the insurer will give you money to pay for repairs, a replacement vehicle and even compensation for injuries.
There are different types of car insurance from all sorts of insurance companies, with quite wild price differences – it definitely pays to be clued up before going head first into the complicated world of insurance, so keep reading and we’ll run through how to find the best deal for you.
What are the different types of car insurance available?
The 3 main types of car insurance are:
Third party is the minimum level of insurance required by law. It’s very basic, and only covers damage caused to other people’s car and injuries to the driver.
If you caused an accident that injured another driver and damaged their vehicle, your insurance would only cover their compensation and costs. Any passengers in your car would also be covered – but as the driver, you’d be left to cover the repair costs for your own vehicle, which can be expensive, and no cover for your own injuries.
Third party, fire & theft
As you might guess, this kind of insurance is identical to basic third party, but with the added bonus of covering, you guessed it – fires and theft.
Fully comprehensive cover is the best ‘all round’ type of car insurance. (often just called fully comp). It can cover pretty much anything – damage or injuries to you and your car, plus other people and their cars, fire, theft and anything in between.
Read this before looking for a deal: you might be thinking, “I’ll just go with basic third party as it will be the cheapest…”
In fact, as with almost everything in life, companies are trying to pull a fast one and make you part with as much money as possible, and insurers have wised up to this exact psychology. They’re now betting you won’t even look at deals for third party, fire and theft, or fully comprehensive, and have massively increased the prices of just basic third party, which can now be even more expensive than fully comprehensive! So far less protection, for more money.
Nuts About Money tip: always check every type of cover, or you might find you are overpaying for the most basic cover.
How much is car insurance for new drivers?
For the majority of new drivers, you’re probably going to be spending at least £1,000 on car insurance for your first year – and if you fall into the 17–20 age bracket (lucky you!) you could even be paying upwards of £1,800 (not so lucky!).
It’s all a matter of risk for the insurance company. Usually, the less experienced you are on the road, the more you’ll be paying for your insurance, which unfortunately means that insurance is often pretty expensive for new drivers.
But there are ways to get the price down, if even by just a little bit.
How to get cheaper car insurance for new drivers
1. Add a responsible 2nd driver to your policy
Adding a second ‘responsible’ driver to your policy (e.g. mums, dads, aunts and uncles) can really help to cut costs. Car insurance is really all about risk, so adding a second driver (so 2 people are insured, not just you), with a good track record can help to lower the overall risk of your application.
However, a couple of things to bear in mind. Firstly, this won’t always guarantee a lower premium, so you may need to play around a bit by adding/removing different family members. Secondly, the added individual would need to be realistically able to drive your car – which is why household members and close family are usually best.
2. Check out multi–car cover
If there’s more than one car in your household, sometimes you can start to make some big savings by insuring multiple vehicles under the same policy. You’ll need to check this directly with the insurer, as in some cases it can end up being more expensive, but it’s definitely worth investigating.
3. Pick an affordable excess
Insurance jargon alert! Your ‘excess’ is the amount of money you’ll personally be contributing towards any claims, if there’s ever a car accident and you want to claim on the insurance.
If there is an accident and it wasn’t your fault, you’ll often be refunded this excess. However, you usually need to pay the excess up front to get a claim started – so you just need to make sure you can afford it.
A bit more about your excess
A higher excess means you’re volunteering to pay more towards the damages – but also means you’re likely to be paying a lower premium (since in the eyes of the insurer, you’re taking on more risk.)
And a lower excess? You guessed it. You’re volunteering to pay less towards any claims, but you’re likely to be paying a higher premium.
In the world of car insurance, paying a slightly higher excess can have some benefits. Many people find that claiming for less than £500 worth of damage isn’t really worth it, as making a claim can increase the cost of future insurance policies, and can affect the discount all insurers give you when you don’t claim, called a no-claims bonus – so there isn’t much point in setting a low excess.
No-claims bonus: after every year you don’t claim, you’ll get a 1 year no-claims bonus, which is transferable across insurers, and these can add up to big discounts, so it’s worth keeping in mind when looking to claim for small amounts.
4. Play around with job titles
There’s some trial & error involved here, but (legitimately) tweaking your job title when applying for insurance can actually reduce the cost.
This is because insurers calculate their costs based on certain professions.
For instance, switching from ‘creative director’ to ‘marketing manager’ can save you money – or selecting ‘personal assistant’ rather than ‘secretary’. As we say – this is about trial and error rather than logic – but if it can save you cash, it’s worth having a go!
However, you should always be honest when providing information, so stick to the truth, even if it’s just a tiny bit stretched.
5. Look your best for the insurer
There’s a few things that can make you look a bit better in the eye of the insurer:
Buying a car with, or fitting, security devices (e.g. alarms, immobilisers)
Avoiding modifying your vehicle, such as lowering or adding expensive items like sound systems
Parking your car in safe spaces, like garages and driveways (if possible)
However, the golden rule is to always tell the truth – it can be tempting to bend the truth to try and lower the cost, but if you ever need to make a claim and something doesn’t add up, the insurer won’t pay out on the claim, ouch!
Now that you know how to reduce your costs, you might be asking – where do I start hunting for the right insurance policy? Good question! Let’s run through the 3 simple steps.
Step 1 – search the market
Comparison sites are a great place to start your search for car insurance. They’ll search almost all of the insurers out there and give you a list of options and prices so you can easily compare.
However, they are all slightly different, with deals from different insurers, so it’s best to check all of them if you have the time. We’ve ordered them for you below in terms of where you can normally find the cheapest deal.
Search the market
Comparison sites are a great place to start your search for car insurance.
And before you rush off and start getting quotes through comparison sites, you’ll need the following information:
Personal details (name, age, address, etc)
Driving licence information (i.e. license number)
Car information – make, model, engine size, etc
Nuts About Money tip: if you’ve found some tempting deals on comparison sites, it’s worth clicking through to the provider’s site and double checking the cost. Sometimes comparison sites make assumptions to speed up the process, and the actual prices may differ slightly. And it’s worth checking what’s included, such as courtesy cars, key replacement or windscreen replacement – the cheaper deals often exclude some things that you might need.
Step 2 – check direct-only deals
Using comparison sites will give you the majority of your options, but they don’t cover every single provider.
Some insurers only offer deals directly to customers, and so won’t appear on comparison sites. There’s not many, and in fact, Direct Line is the only one worth checking. It’s worth having a quick check if you’ve got time – we know how busy you are!
Step 3 – check black-box deals (telematics)
If you’re scratching your head and wondering what on earth ‘telematics’ means, don’t worry – it sounds more complicated than it is.
With a telematics policy, you have an electronic box (black box) fitted to your car that measures your driving – the better you drive, the cheaper your insurance. Sounds pretty sensible, right?
And these days, some insurers will just use your smartphone instead of fitting a black box.
As you drive, the insurer will be tracking things like:
Your driving speed, and whether it’s within the limit
Your brake speed (sharp and sudden braking isn’t great)
Acceleration and cornering speed
The time of day/night that you drive (driving between 11pm–5am can cost more)
Telematics insurance can be a good option for new drivers, as you’re given the opportunity to prove that you’re not high risk, which is usually the assumption insurers make. Knowing that your driving is being monitored can also encourage safer driving, which is never a bad thing.
A CompareTheMarket survey found that telematics insurance was the cheapest option for 68.9% of 17–20 year olds – so if you’re a young driver, it could well be worth looking into this to save some cash.
You also won’t need to fork out for the device itself, as this is usually wrapped up in the cost of the insurance.
However, some telematics policies do include some restrictions – they might ask you to estimate your mileage for the year, and if you exceed your estimate, you may be charged extra. Some providers also enforce a driving ‘curfew’ to discourage driving during more dangerous times – usually after 11pm.
All you need to do is follow our three simple steps and you’ll be driving round in no time – well, if you can afford petrol after you’ve paid for the insurance!
And something to bear in mind – in 12 months time when your insurance runs out, don’t auto-renew! You’ll get a bad deal and the insurer will be laughing all the way to the bank – there will be brand new cheaper deals out there, and all you need to do is search again and switch to the best one, it only takes a few minutes, and you’ll keep your no-claims bonus too. Good luck!
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This article has been fact checked
This article was written by the team at Nuts About Money, and fact-checked by 2 independent reviewers. You’re in safe hands.
Search the market
Comparison sites are a great place to start your search for car insurance.
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