How young people can cut car insurance costs
Not all young drivers are boy racers, yet car insurance premiums tend to be prohibitively high for anyone under 21. Here are some tips that could help cut the cost of cover for those who’ve recently lost their L-plates.
One of the UK’s biggest insurers threw its weight behind responsible young drivers at last week’s Association of British Insurers (ABI) conference, urging the industry to recognise that not all young people are careless behind the wheel.
Simon Douglas, director of AA Insurance, said in a speech on Tuesday: “I believe the industry must work together to find a formula that recognises those who are able to demonstrate they take a responsible approach to driving.”
His words will strike a chord with many young drivers, or those who remember the pain of paying their first car insurance premiums.
Currently, many insurers will not offer cover to drivers below the age of 21, or even in some cases to those under 25.
Companies that will provide insurance for young drivers often demand impossibly high sums in return, and it is not unusual for new drivers – particularly young men – to be charged upwards of £2,000 for 12 months’ third party cover.
Faced with the prospect of such expense, it’s no wonder some young people feel despondent about their driving futures immediately after passing their tests.
However, being aware of the following dos and don’ts could help even the least experienced driver keep on top of their car insurance costs.
DO reduce your risk
All insurers price their customers’ premiums in line with the likelihood that they will claim. In other words, the more probable it is that you’ll have an accident or experience damage to your vehicle, the more it will cost you to buy car insurance.
Unfortunately, the statistics speak for themselves when it comes to young drivers. As Simon Douglas pointed out in his speech to the ABI: “One out of every five young drivers suffers a crash within their first year of driving, and young drivers are 10 times more likely to be involved in a serious collision than experienced drivers.”
One way to convince an insurer that you are a less risky prospect is to take a Pass Plus course. Pass Plus helps to extend a driver’s experience of different conditions and involves training on motorways, at night and on rural roads. A course typically costs between £100 and £150, but completing one could reduce annual insurance premiums by more.
DO improve your car’s security
On a similar note, anything you can do to reduce the risk your car will be stolen or criminally damaged should help control the cost of insuring it. Fitting your car with an alarm or immobiliser, and parking it in a garage or on a drive rather than on the street, could make a positive difference to the price you are charged.
DO choose your car carefully
When it comes to buying a vehicle, it is important to be aware that some will always cost more to insure than others. As a general rule of thumb, cars with powerful engines and soft-top vehicles tend to be comparatively expensive to insure.
The ABI gives all cars a risk rating that will affect the price of insuring them. More information can be found at www.thatcham.org.
DO add an older driver to your insurance policy
Adding an older friend or relative as a ‘named driver’ on your car insurance policy should help cut the cost of your premium. This is because your insurer will assume that, for at least some of the time the car is on the road, it will be driven by someone with more experience.
However, it is vital that an older motorist is not named as the main driver of a vehicle if it is actually a younger person’s car. This practice, known as ‘fronting’ among insurers, has become a significant problem in the industry – and young people and their families are particularly vulnerable to temptation.
Fronting is a serious form of insurance fraud, and if it is discovered by your insurer your whole policy will probably be declared invalid. This means any claim you make will not be paid, and you (and the older person involved in the fraud) could face prosecution.
DON’T modify your vehicle
Modified cars generally cost more to insure than unmodified vehicles – even if the changes that have been made have no impact on their speed or power. Young drivers should avoid making modifications to their own vehicles or buying second hand cars that have been modified.
DO consider opting for third party, fire and theft cover
Third party, fire and theft insurance cover offers far less protection than a fully comprehensive policy. However, it is likely to be the cheapest insurance option for a young driver.
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