Insurance Hints for Young Drivers

Finding cheap insurance as a young driver can be a big problem. After being impressed with our website, we were contacted by Moneysupermarket.com, who have offered the following article which we feel may be useful to our pupils and other young drivers who find increasing premiums tough to deal with.

The cost of car insurance is increasing, with moneysupermarket.com reporting that the average driver paid 40% more for insurance in 2010 than on the same policies in 2009.

Young and newly qualified motorists have been the worst hit by this, with an 18 year old male driver with a 1.25 litre Ford Fiesta likely to face an annual bill of close to £7,000. However there are a number of things you can do to lower your insurance expenditure and make car insurance affordable once you pass your test:

The policy holder

The policy holder (i.e. you) is the factor which has the single biggest influence on car insurance quotes on offer. This has been demonstrated by horrendously out of proportion premiums which have recently been offered to both young and newly qualified drivers.

There isn't much you can do about your age, but you can improve your experience levels. Completing advanced driving courses such as pass plus will help with this, making you statistically less likely to be involved in an accident and make a claim. Insurers will recognise this in the form of cheaper car insurance prices.

Named drivers

Adding named drivers to a policy is another way to reduce car insurance prices. These named drivers should be both more experienced and older in order to generate cheaper premiums, with parents being the usual candidates.

With young drivers being victimised with increasingly ludicrous premiums, there has been an increase in the number of young drivers becoming the named driver themselves and having the older/more experienced driver become the main policy holder. However, this practice is called "fronting" and is actually illegal.

Choose the right car

Your choice of car will have a massive impact on the car insurance prices you are offered. Each vehicle is assigned to an insurance group numbered between one and fifty, with cars in insurance group one the cheapest to insure. This is determined based mainly on the performance and security levels of the vehicle.

Young and newly qualified motorists should therefore opt for a vehicle in the lowest insurance group possible in order to make insurance affordable.

Parking and security

You can reduce your premiums further by parking your vehicle in a secure location such as a locked garage rather than on a public road. This should be done where ever possible and it dramatically reduces the chances of your vehicle being stolen or vandalised, thus attracting these car insurance savings.

This statistical likelihood can be further reduced with the addition of alarms and/or immobilisers that are manufactured by companies such as Thatcham who are recognised by the insurers.

Choose your excess

Excess is the amount of money you will be forced to pay towards the insurer's expenses when ever a claim is made. There are two forms of this:

Compulsory excess- this is usually £250 and is non-negotiable
Voluntary excess- this is the amount extra you are willing to pay whenever a claim is made. The sum can be anywhere between £100 and £500.

The more you are willing to contribute towards insurers expenses, the less they will be forced to pay out when a claim is made. This means that people paying higher levels of excess will generally be on the receiving end of cheaper car insurance premiums. However, be careful not to offer to pay more than you can afford.

Levels of cover

There are three different levels of cover to choose from:

Third party- covers the cost of repairs to other people's property, but insurer will not pay out for any repairs which you needed on your own vehicle. This is the bare legal minimum.
Third party fire and theft- covers the cost of repairs to other people's property and will also agree to cover the policy holder if their vehicle is either stolen or damaged by fire.
Fully comprehensive- Covers the costs of repairs to both other people's property and your own vehicle.

Fully comprehensive is the most complete package and is therefore the most costly of the three options.

The level of cover you should choose is really dependent upon your own personal situation. If you own a vehicle which is worth under £500 it would seem foolish to opt for anything other than third party, as the excess you would be forced to pay would likely be worth more than the car. However if you car is worth much more than this, then fully comprehensive would seem to be the only sensible option.

Mileage

An insurer will consider someone who is planning on travelling 20,000 miles over the course of a policy far more likely to be involved in an accident and make a claim than someone who is only planning on completing 10,000 miles. The driver with the smaller mileage allocation will therefore be on the receiving end of cheaper car insurance premiums.

However, do not set a mileage allocation which you know you will exceed as this will render your car insurance policy void once you pass this point, and insurers will be legally entitled to refuse to pay out when a claim is made.

Shop around

Combining all of the above points when filling in your application for a car insurance policy should help to significantly reduce the premiums that you are offered.

However, in order to be sure that you are getting the best deal available you should compare offers available through every different car insurance company available. The only problem is that there are hundreds of them, which makes it a very time consuming activity.

You can reduce the amount of time required to do this by utilising price comparison websites which will compare deals available through the vast majority of these companies in a matter of minutes. There are still some insurers, such as Aviva or Direct Line, who will not be included on such websites but this doesn't mean that you can compare prices available on their websites as a complimentary activity to your price comparison site usage.