Young driver car insurance

Young drivers’ insurance
Tips, discounts, cashback & more

Young drivers, particularly those under 25, have long encountered steep car insurance rates due to their elevated risk of accidents. Recently, the cost of insurance for this age group has surged by 46%, with the typical annual premium exceeding £2,000. However, it’s important not to assume that your renewal offer is the most competitive. By following our proven strategies, many have managed to save £100s.

What is young drivers’ insurance?

Your age is one element that insurers consider when determining your car insurance premiums, but it isn’t the sole factor (check out what influences your car insurance quote). Consequently, ‘young drivers’ insurance’ as a specific category doesn’t exist, since most car insurance policies are available to everyone.

Given that many young drivers often lack extensive driving experience and generally encounter higher insurance costs, we’ve created this guide with additional advice and strategies, such as exploring black box insurance options.

As with all car insurance, young drivers typically have the option to choose from three primary levels of coverage (for more information, see types of car insurance explained):

• Third party only. This covers damage to someone else or their property.
• Third party, fire and theft. As above, but cover if your car is stolen or catches fire.
• Comprehensive or ‘fully comp’. On top of third party, fire and theft, you can also claim the costs of repairing or replacing your own car if you were at fault and caused the accident.

ExEconomics Compare Car Insurance tool

You could potentially save £100s by switching your car insurer. It’s always wise not to automatically renew your policy—instead, use multiple comparison websites to explore a wide range of insurers in just minutes.

ExEconomics Compare Car Insurance tool is designed to simplify the process of finding affordable car insurance online. Here’s what you can do:

• Complete just one questionnaire. We’ve integrated compare form, so if you’ve used it before, your answers can be auto-filled.
• Receive ExEconomics money-saving tips as you proceed. For example, our ‘best time to buy’ tool helps identify the optimal time to get the lowest quotes.
• View insurance quotes as a baseline. These come from best rate comparison, but our goal is for you to find even better deals.
• Utilize personalized suggestions to reduce costs further. These include tips on adding a second driver, exploring multicar policies, or adjusting your job title, with easy checks to see if these changes lower your premium.
• Discover if other websites may offer cheaper quotes. We’ll let you know if Direct Line (which isn’t listed on comparison sites) might be cheaper for you, and share our latest ranking of comparison sites to try.

If you prefer doing more of your own research when looking for quotes, you can still follow our proven steps below to find the cheapest car insurance, including which comparison sites to use.

How to cut costs for young drivers’ car insurance

Here are our top car insurance cost-cutting tips for young drivers that can save you £100s.

1 – Don’t assume third party is cheapest

There are three different types of car insurance:

• Third party only
• Third party, fire and theft
• Fully comprehensive.

Ideally, third-party insurance would be the most affordable option for young drivers, given its lower coverage compared to fully comprehensive policies. However, this isn’t always the case.

The reasoning behind this is that insurers often view those who opt for third-party insurance as higher risk. In a case involving a low-risk young driver, we discovered that opting for comprehensive coverage resulted in an annual savings of £1,500 compared to a third-party only policy.

2 – Add a responsible second driver

Incorporating a responsible second or third driver, like your dad or Aunt Dot, can actually reduce your expenses.

While including an additional driver typically increases the cost, it can surprisingly lower your overall premium. For instance, when we added a 40-year-old family member as an ‘occasional’ driver (rather than the primary driver) to an 18-year-old’s policy, the premium decreased by approximately £1,000. Here are seven strategies illustrating how this approach can help you save money…

• Car insurance fundamentally revolves around assessing risk. Consequently, if you’re considered a high-risk driver, including a driver with a significantly lower risk profile as a secondary (or even tertiary) driver can reduce the overall risk level. This adjustment may result in a more affordable insurance policy for you.
• This approach isn’t limited to young drivers. Although it is particularly effective for them due to their high-risk profile and extensive network of potentially lower-risk individuals such as parents, it can benefit drivers of all ages. Its impact is notably significant for those facing higher insurance costs.
• The quality of one’s driving history and their risk level play a significant role in determining potential savings. Drivers with a strong record are more likely to benefit from greater savings, though even those who present a lower risk can contribute to savings. While insurers are legally prohibited from discriminating based on gender, factors such as age, driving experience, and history can influence the outcome.
• This process relies on trial and error rather than logic. For example, your mother might raise the price, your brother might lower it, or the other way around. The key is experimenting with various quotes and observing the outcomes.
• Different insurance companies have varying policies: adding your uncle might reduce your costs with one insurer but could increase them with another. To quickly assess the impact, try comparing quotes on different comparison websites—it’s a straightforward process. Check out our recommended comparison sites list below.
• The second driver should be someone who would realistically operate your vehicle. So, avoid including someone like Lewis Hamilton, unless you happen to be his sibling (and even then, racing drivers might pose a significant risk, so it’s best not to include them). However, including your mother, child, close friend, or grandmother is fine, provided they are likely to drive the car.
• Don’t list someone as the primary driver if they aren’t. This practice, known as ‘fronting’ in the industry, is considered fraudulent. If you’re caught doing this, you could face criminal charges and your insurance may become invalid.

3 – Getting quotes 26 days ahead can save £100s

Securing car insurance 26 days in advance can save you £100s, though rates are still relatively affordable a few days before or after this period. We first examined this topic in 2018, noting that 21 days ahead was the optimal time for getting the best insurance quotes.

Recent data from our partner, covering over one million quotes from January to April 2024, indicates that 26 days before your renewal date is generally the most cost-effective time to get quotes. However, quotes obtained between 20 and 27 days before renewal are fairly consistent in price.

This latest analysis revealed that a policy on renewal day costs an average of £2,277 annually, whereas getting quotes 26 days in advance drops the average cost to just £906 per year—a significant saving of £1,371.

Typically, the closer you get to your renewal date, the more risky you appear to insurers, which could increase your premium. Conversely, seeking quotes too early, such as 28 days or more in advance, may also result in higher prices due to fewer insurers being willing to provide quotes at such an early stage.

If you’re within the 20 to 27-day window, it’s wise to get quotes now as prices tend to rise as the renewal date approaches. If you’re closer to your renewal date, every day counts, so obtain quotes as soon as possible.

For a comprehensive guide on securing the cheapest policy, refer to our comparison site recommendations below.

4 – Make yourself attractive to the insurers

Whether or not you’re a young driver, insurance premiums (the payments made to insurance companies) depend on three things:

1. The insurer
2. Level of cover
3. Your risk level

Car insurance premiums are determined by actuaries who evaluate risk factors. You can potentially save a significant amount by demonstrating to an insurer that you’re not the typical high-risk young driver.

The cost quoted by each insurer varies based on the underwriters’ evaluation of your unique circumstances and the insurer’s pricing strategy designed to attract specific customer profiles. For more details on what influences your quote, see the relevant information.

Should I try and reduce my mileage?

Driving less can lead to lower insurance premiums. Whenever possible, try to minimize your mileage. While this may seem obvious, the real key is to factor in the additional insurance costs for longer trips, rather than just comparing the cost of fuel to taking the bus or train (you might also find our guide on cheap trains useful).

From anecdotal evidence, although many people quote an annual mileage of 10,000 miles, some have found that 5,000 miles is often more effective, though this hasn’t been scientifically verified. If you use your vehicle for business purposes, make sure to report this accurately; otherwise, including business miles as personal could invalidate your policy.

Can extra driving courses help?

PassPlus: This program, offered by the Driving Standards Agency, is designed to boost drivers’ confidence on the road. It includes six key modules: urban driving, driving in all weather conditions, rural road driving, nighttime driving, dual carriageway driving, and motorway driving, with a minimum duration of six hours.

The cost of the course ranges between £150 and £250, depending on your location and the driving instructor or school you select. In some areas of England and Scotland, local councils may offer discounts of up to 40%, typically for drivers under 25. In Wales, the course is available for just £20. For more information, visit Gov.uk.

With the PassPlus certificate, a few insurers may offer discounts on your insurance premium. However, recognition of the course has declined in recent years, so these discounts might be limited. It’s possible that you could find cheaper insurance options elsewhere.

5 – Tweak your job description

Explore how a genuine adjustment to your job title might save you £100s.

Another easy adjustment involves tweaking your job description (legitimately, of course). For instance, an illustrator might cost less than an artist, an editor less than a journalist, and a PA less than a secretary.

Try using our Car Insurance Job Picker tool to see if minor modifications to your job description could lead to savings. Always be honest—misrepresentation can be deemed fraudulent. To determine if your description is reasonable, ask yourself, “Would a reasonable person find this a fair representation of my job?” If you have doubts, it’s better to be cautious.

What should I put if I’m unemployed?

If you’re unemployed, you might see your insurance costs increase by up to five times if you declare your job status as such. Homemakers (both housewives and househusbands) are not subject to these increased costs. If you fall into this category, be sure to indicate it to prevent a rise in your insurance premiums.

However, you should only use the homemaker designation if you are genuinely not looking for work and are not receiving benefits that necessitate job searching. Misrepresenting your status could be considered fraud.

6 – Tell ’em the truth, the whole truth and nothing but the truth

If your situation isn’t typical—such as having filed a claim recently, owning a modified vehicle, or anticipating to drive 100,000s of miles a year—inform your insurer. Failing to do so could invalidate your policy, even if you later make a claim for an unrelated matter.

You should always inform your insurer of any changes, including something as minor as a new address, to avoid potential issues with claims. If your policy gets canceled, securing new insurance can become challenging and costly, and it may impact you long-term.

Changes in your situation, such as a job change, can influence your risk profile according to insurers. It’s worth noting that unemployed individuals often (though not always) face higher car insurance rates, so keep your provider updated if you’re unemployed.

In the realm of insurance, keep in mind the golden rule:

Tell them the truth, the whole truth and nothing but the truth.

If after reviewing these tips you think, “it’s simple to deceive about this,” you’re absolutely correct. However, misrepresenting information on your insurance form constitutes fraud. This can result in your insurance being voided and, in the most severe situations, lead to criminal charges for operating a vehicle without insurance.

7 – Never auto-renew. Loyalty is expensive

Sarah Cooper’s tweet perfectly captures how car insurance companies take advantage of their loyal customers. She tweeted, “My car insurance renewal is £1,200, but a new policy with the same company is £690. How is this justified?” The answer is simple: it isn’t. They simply do it.

Insurance companies increase rates year after year, counting on customers’ inertia to keep them from switching. To avoid this, make a note of your renewal date. Compare quotes on various comparison sites, and then reach out to your insurer to see if they can match or even beat the lowest quote you found. If they can, you’ll save money.

8 – Multicar cover can save you £100s if you live with your parents or have more than one car

If your family or household has more than one vehicle, you might find this information useful. Adding multiple cars to a single policy can result in savings of £100s, or even  £1,000s, of pounds for some individuals. However, it might not always be cheaper for everyone.

To assist you, our comprehensive Multicar insurance guide provides details on when to consider a multicar policy, how these policies function, and how to secure one, even if your vehicles have different start dates.

9 – A telematics policy (aka black box) can work out cheaper for safe drivers

Telematics is a type of insurance policy that adjusts your premiums based on your driving behavior, including when, where, and how you drive. This is monitored by a device called a black box, which is fitted in your car. Your driving performance directly influences the cost of your insurance—good driving can lead to lower premiums. In some cases, this monitoring is done through a smartphone app.

If you’re sure of your driving skills, a telematics policy could save you £100s on your insurance. However, be cautious: poor driving could result in higher premiums or even the cancellation of your policy.

10 – Set the excess at a level you can afford

Consider opting for a policy with a higher excess—the amount you have to pay yourself when making a claim. Choosing a higher excess can lead to lower premiums, but ensure you can handle the premium if you need to make a claim.

For many, claiming for damages under £500 can increase future insurance costs and potentially invalidate no-claims bonuses, making such claims less beneficial.

Why pay extra for a lower excess? Some insurers may offer reduced premiums for a £500 excess, so explore this option when comparing quotes. However, be aware that a larger claim will require you to pay more out-of-pocket, in addition to any compulsory excess that comes with the policy.

If a high excess concerns you, consider an excess protection policy. This policy allows you to reclaim the excess amount. However, ensure that any discount from your insurer outweighs the cost of the excess protection policy.

Keep in mind that this protection policy does not cover you within the first 30 days of purchase. During this period, you will need to pay the excess upfront and wait for reimbursement, regardless of who is at fault.

Compare cheap car insurance costs

What do I need to get a young driver insurance quote?

Once you know the basics from our top 10 tips for cutting costs, it’s time to follow the steps below.

Warning: Even if you’re tempted to claim that someone else is the primary driver, deny having any points, or deliberately understate your mileage to lower your premium, resist the urge. Full honesty is crucial, as dishonesty could invalidate your insurance policy and potentially result in legal consequences.

Step 1: Get quotes from multiple comparison sites

To start, visit comparison websites where your details are sent to multiple insurers and brokers to find the lowest quotes. Since no single site covers the entire market and prices can vary, using several sites is the most effective way to save money. Ideally, you should use all four, but if you’re short on time, we’ve ranked them according to which ones most frequently offer the lowest quotes to increase your chances of securing the best deal.

Keep in mind that comparison sites perform a soft search on your credit file to provide quotes, which does not affect your future credit opportunities.

How do we pick the order?

We examine insurance quotes from Compare The Market, Confused.com, and MoneySupermarket to determine pricing trends. Our process involves:

1. Assessing how often each comparison site provided the lowest or nearly lowest quote (within £5).
2. Ranking the comparison site that offered the most lowest or nearly lowest quotes at the top.
3. Comparing the top-ranked site with each of the other two sites to identify which pair yields the highest number of lowest quotes. This combination will then be prioritized to enhance the likelihood of obtaining a competitive quote quickly.

Here are the latest scores

This month’s data reveals that Compare The Market offers the lowest quote 53% of the time, outperforming the other two comparison sites. By obtaining quotes from both Compare The Market and MoneySupermarket, you can enhance your odds of receiving a lower quote to 81%.

To further improve your chances of finding a budget-friendly quote, consider getting estimates from Compare The Market, MoneySupermarket, and Confused.com.

If you’re under 25, follow this sequence. However, if you are 25 or older, have no more than three penalty points on your license, have a clean claims history, and the car isn’t a company vehicle, refer to our guide on cheap car insurance.

Try comparison sites in this order

Struggling to find (affordable) cover?

If you’ve experienced a series of claims or accidents, have a medical condition that impacts your driving, or hold four or more points on your driving license, obtaining an affordable quote from a comparison site might be challenging. You might even struggle to find coverage altogether.

If you’re not receiving quotes from many insurers on these platforms or if the premiums seem excessively high, think about seeking assistance from a broker. Search the British Insurance Brokers’ Association website to find someone who can help.

Always double-check the price

Visit the insurance provider’s official website to verify the quotes, as comparison sites may sometimes make certain assumptions to expedite the search process.

What to check

They aren’t always flawless—ensure your results are accurate.

Occasionally, the details you input might not fully transfer to the insurer’s website. Therefore, after obtaining results from comparison sites, make sure to verify the quotes and included details directly on the provider’s website.

This is particularly crucial for individuals with unique circumstances, as it’s essential to double-check that all your needs are accurately reflected.

Examine the policy’s coverage

Verify if “free car hire” is covered while your vehicle is under repair. Additionally, while you’re reviewing the policy, consider adjusting the details to potentially lower the price. Examine the excess charges and explore if including additional drivers might reduce the overall cost.

Step 2: Try a specialist telematics policy

Telematics, also known as “black box,” “smart box,” “pay-as-you-drive,” or “usage-based” insurance, is a form of motor insurance where your premium is influenced by your driving habits.

With this policy, a device is either installed in your car or an app is downloaded to your phone to track your driving behaviors, including when, where, and how you drive, as well as your braking patterns, speed, cornering, and mileage. The downside is that risky driving behaviors can lead to higher costs or even cancellation of your policy. Essentially, better driving habits can lead to lower insurance premiums.

These policies are now commonly listed on comparison sites, and if you are a cautious driver who drives infrequently and primarily during off-peak times, you might benefit from reduced premiums.

How do insurers judge your driving?

It’s not merely about maintaining a grip at ten and two and smoothly changing gears. Insurers will consider several factors to decide if they will recognize your responsible driving habits.

• The time of day or night you drive (10pm to 5am may cost more)
• Your speed (stick to the limit)
• Gentle braking reactions (hard and sharp stopping is not good)
• Gentle acceleration and cornering is good (don’t treat your local roads like Silverstone)

Although your insurance company will monitor your driving habits closely, there are generally few limitations regarding when and where you can drive.

Do I have to pay for a black box?

After enrolling in a policy, you’ll need to schedule an installation date for a black box in your vehicle, unless your policy is app-based.

Usually, you won’t be required to pay a separate fee for the box itself; its cost will be included in your premium. However, some insurers may charge you if you miss the installation appointment, need to transfer the box to a different car, or wish to have it removed.

Additionally, if you attempt to tamper with the box, such as trying to move or deceive it, and it gets damaged, be prepared for a significant charge for a replacement.

Step 3: Check cashback sites to see if you can get cashback

If you use cashback websites, you’re probably aware that when you purchase car insurance through them, they earn a ‘lead fee’ for directing you to the insurer. After the insurer pays this fee, the cashback may be given directly to you. However, some cashback sites are now opting to donate the cashback to charity instead.

This information, including whether the cashback will be directed to a charity, should be noted alongside the insurance provider. It’s a good idea to verify this if you have any doubts.

Opting for cashback sites can be advantageous compared to comparison sites, but make sure the quote you get through a cashback site isn’t higher. Treat the cashback as a potential bonus rather than a certainty, as sometimes the deal may not be tracked or the cash might not be paid out. Consider these two options when making your choice.

• Route 1: Explore cashback sites’ own comparison tools. For instance, using Topcashback* will provide a Confused.com comparison, while Quidco* offers a MoneySupermarket comparison. If you purchase a policy through either of these cashback sites, you can earn £45 cashback. However, keep in mind that you won’t receive the standard Confused or MoneySupermarket benefits since these are branded versions of their comparisons.

As mentioned earlier, it’s important to verify the quotes you receive, as they might differ from those on Confused’s or MoneySupermarket’s platforms. To find the best deal, compare the quotes provided, subtract £45 from the lowest quote on Quidco or Topcashback, and determine which option is the most cost-effective for you.

• Route 2: Start by identifying your most affordable insurer, then use a cashback website. Once you’ve pinpointed your cheapest insurer, verify the cashback amount available through platforms like Quidco* or Topcashback*.

However, ensure that the desire for cashback doesn’t overshadow the importance of choosing the right insurer. Select your insurer based on its merits first, and then seek out cashback offers. Don’t prioritize cashback amounts over the insurer’s suitability.

Also, confirm that the price you receive through this method matches the prices from your previous comparisons. If it’s higher, evaluate whether the cashback compensates for the difference. If not, stick with the quotes you initially obtained.

Step 4: Haggle with your existing insurer

Once you’ve identified the lowest quote, consider negotiating for a better deal with your current insurer. While haggling isn’t essential, especially if you’re thinking of switching providers, it can be advantageous if you plan to stay with your existing insurer.

After securing the best possible rate, reach out to your insurer by phone or through their online chat to see if they can offer a better price or match the quote you’ve received. Typically, it’s a straightforward process, but if you encounter difficulties, refer to our Car and Home Insurance Haggling Guide for effective strategies.

What extras can I get with car insurance?

• Courtesy car.Examine the types of cars available, the situations in which they might be suitable, and the duration for which you can have them. You might also have the option to upgrade and extend this coverage if it doesn’t quite meet your needs.
• Breakdown policy. Examine the coverage details closely, as many policies only provide basic protection, which might not include home breakdowns or travel to your destination. While upgrades are frequently available, if you’re opting for more expensive insurance with breakdown coverage, be sure to compare it with a budget-friendly standalone car breakdown policy.
• Protected no-claims discount.If you maintain a car insurance policy for a full year without filing a claim, you’ll receive a discount for the next year. This discount can be quite beneficial, so you might want to consider protecting it to avoid losing it. For more information, check out what no-claim bonus protection entails.

While it’s not necessary for your policy to include additional features, if certain aspects are crucial to you—such as having access to a courtesy car if you can’t use your own—ensure that the policy you choose includes these provisions.

How to complain about your insurance provider

The insurance sector is often criticized for its customer service, and experiences can vary greatly between providers. While some insurers might offer satisfactory service, others can be quite problematic.

Frequent issues include delays in claim payments, complete denial of claims, or undervaluation of your vehicle following a total loss. Additional grievances might involve unjustified fees for updating details like your address or vehicle, or hidden exclusions buried in the fine print. It’s generally a good idea to reach out to your provider directly first. If that doesn’t resolve the issue, consider using the free complaint tool Resolver. This tool assists in managing your complaint and, if necessary, helps escalate it to the free Financial Ombudsman Service.

Young drivers’ insurance Q & A

Q – Why is car insurance so expensive for young drivers?

A – Several factors contribute to this situation. Younger drivers, due to their lack of experience compared to older drivers, fall into a higher risk category for insurers. Their inexperience often leads to a higher incidence of accidents, resulting in more claims, which prompts insurance companies to raise their premiums to cover the increased risk.

However, by driving prudently, you can help reduce this risk and potentially lower your premium. For more information on how to do this, refer to the details above. Additionally, our guide to car insurance for new drivers provides comprehensive insights to assist you.

Q – Should I take a monthly payment plan?

A – Be cautious with ‘pay monthly’ options – typically, the insurer lends you the annual fee and then applies high-interest rates on top. For those aged 20-24, with average costs exceeding £900, splitting the payment into installments can add over £200 to your premium.

If possible, pay the full amount upfront. If that isn’t feasible, consider borrowing the funds from a cheaper source, such as a 0% credit card for spending, and ensure you make sufficient repayments to settle it within a year.

When using a credit card, verify whether the insurer or provider imposes a fee for this payment method – though this fee is usually lower than the interest charges for monthly installments.

Q – I’m not driving my car for a bit, does it need to be insured?

A – Yes, vehicles are required to have insurance unless they are officially declared as off-road. The Continuous Insurance Enforcement system mandates that every car must be insured, regardless of whether it’s in use. This initiative aims to address the issue of around two million drivers who are uninsured by cross-referencing vehicle and insurance databases.

To avoid this requirement, you must submit a SORN (Statutory Off Road Notification) to confirm that your vehicle will not be used. Make sure to search for the best insurance rates ahead of your policy’s renewal to avoid automatically renewing at a potentially higher rate and incurring a penalty.

Q – Am I covered to drive others’ cars on my insurance?

A – If your insurance policy permits, using another person’s vehicle instead of your own can help you reduce your mileage. Make sure to review your policy details to confirm if this is an option.

If you have a comprehensive insurance plan, it may include “driving other cars” coverage, which often offers third-party protection while allowing you to lower your mileage and, consequently, the cost of your own insurance.

Q – Would it be cheaper for me to just get a motorbike instead?

A – Typically, insurance costs are significantly lower for mopeds or motorbikes compared to cars. Additionally, some insurance providers may transfer any no-claims bonus from your bike policy to your car insurance if you choose to insure your car with them later. However, it’s important to consider safety as a new driver—being in a car generally offers better protection in the event of an accident. For more details, refer to the Bike Insurance guide.

Q – Are there any ways to get a no-claims bonus faster?

A – Certain insurance schemes provide an accelerated no-claims bonus. If you have been an additional driver on someone else’s policy, such as your parents’, you might want to contact your insurer and inquire whether they could consider this experience towards your no-claims bonus.

Q – Must I inform my insurer if I have an accident but don’t claim?

A – If you’re involved in an accident and end up damaging another person’s vehicle, but choose to pay for the repairs out of pocket, you should still notify your insurance company about the incident.

Many people skip this step, believing it might lead to higher premiums. However, if you were to have another accident and it’s determined to be connected to the initial incident, you could face issues. In such cases, your claim might be denied rather than your policy being canceled or flagged for fraud. Nonetheless, this situation could potentially cost you £1,000s.

Q – What happens if my insurer goes bust?

A – Insurance providers regulated in the UK are safeguarded by the Government-backed Financial Services Compensation Scheme (FSCS), just like banks. This means that if an insurer defaults, you are protected.

Some insurers, especially those offering telematics pay-as-you-drive policies, are located in Gibraltar. Nonetheless, a specific FCA regulation ensures that these policies are protected in the same manner as those from insurers based in the UK. To be precise: “The UK mandates that all EEA (European) insurers… must participate in the FSCS just as UK insurers directly authorized by the FCA do.”

Should a regulated insurer collapse, the FSCS will attempt to find an alternative provider or issue a replacement policy. If you have ongoing claims or need to file a claim before a new insurer is appointed, the FSCS will ensure you remain covered. For further information, refer to the insurance section of the Savings Safety guide.