A simples guide

How to save money on your first car insurance policy

We remember the excitement of passing our driving tests as well as buying our first cars.

They’re definitely exciting times and we’re sure you’ll be raring to go. Just make sure you’ve got car insurance before you hit the roads.

Here are a few tips on how you might save money on that first car insurance policy.


What’s with all the paperwork?

If you’re planning on buying and insuring a new car, there’s some unavoidable administration involved.

You need to do three key things, register the vehicle in your name, tax it and finally insure the vehicle for the road.

In practice you can do them simultaneously to get you on the road more quickly, but let’s look at each quickly.

Registering the vehicle

If you’re buying a new car you may find that the dealer will register the car for you. That’s one less thing to worry about. You should then receive a V5C registration certificate in the post which is usually referred to as the ‘log book’. If the dealer doesn’t do it for you, don’t worry, you can do it yourself via the DVLA website (www.gov.uk) or you can visit the Post Office.

If you’re buying a used car, the process is going to sound more complicated. Trust us, it will make sense when you do the deed!

The seller needs to complete section 6 of his or her V5C form. This is called ‘new keeper or new name/new address details’. Both you and the seller then need to sign section 8. Finally, they should fill in section 10 ‘new keeper supplement’ and you take this section away with you.

After that they pop the amended V5C form to the DVLA in the post and you should receive a new one in return.

This can take anything from 2 to 4 weeks so don’t panic if it doesn’t arrive straight away. If, after 4 weeks it still hasn’t arrived you can find a V62 form called ‘Application for a vehicle registration certificate’ on either the DVLA website or in a post office. If you send this, along with the V5C supplement that you received from the seller, it will prevent you having to pay a new registration fee.


You can apply for the vehicle tax online via the DVLA website with either your new V5C form or the section 10 slip of the V5C you were given by the seller. Entering these details along with the vehicle registration will allow you to get your tax in place.


You must have insurance in place before you drive the vehicle on a public road. In theory, this is as easy as contacting an insurer with your details and paying for the cover. In practice, it is well worth shopping around for cover as we will see.


Why is cover so expensive?

When you start looking into it, you may be shocked at just how much insurance for first time buyers can cost. Insurers decide on their premium prices by looking at the risk each category of drivers pose. Unfortunately, statistically, young drivers are far more likely to be involved in an accident than drivers aged over 25.

AA research shows that while one in eight British drivers are aged under 25, they account for a quarter of all accidents.

We know that this isn’t your fault personally. You’ve had no opportunity to build up the no claims bonuses either. Unfortunately they’re just facts of insurance life.  

Is there anything you can do to reduce the costs of first time car insurance?

Well the good news is, while you might never class your car insurance as cheap, there are a number of things you can do that might make it cheaper.

1) Shop around

You might not want to go with the first insurance quote that you find – premiums can be expensive and it can pay to look around. Get a quote with us and you can compare various insurers to see if you can get a more competitive price.

2) The value and type of car

The market value and type of car could significantly affect the premium you’ll pay. If you opt for a new, high powered or luxury car you’re going to be quoted some very high premiums. A more common, standard model with a smaller engine might not sound as glamorous but it could save you money on your car insurance until you’ve clocked up some driving experience.

3) Excess

In insurance speak, your policy excess means the amount of money that you would need to pay in the event of any damage to your car before your insurance policy kicks in.

There are a few sorts of excess. The insurer may set a compulsory excess but you can choose to add an additional voluntary excess on top. You can decide to have no voluntary excess so you wouldn’t have to pay for anything over the compulsory excess if you were to make a claim. However, your premium could then be higher. Another type of excess that might be apply to you is a young driver excess which is applied to drivers under 25. Just be sure to read the T&Cs so you know what’s included in the premium.

4) Security

Increasing that security on your vehicle might help with the premiums.

Even something as simple as an industry approved steering wheel lock may make a difference. If you can afford it, investing in an immobiliser might be an option. If you have the option, parking on a drive could also help to lower your premium. Just bear in mind that you might need to speak directly with the insurer to accurately reflect the security measures taken in your premium.

5) Modifying your car

While you may love the idea of adding extras to your car, insurers don’t tend to be so keen. Insurers want you to stick to your factory specifications and could refuse to even quote you a price. Those that will insure you, could charge you more.

6) Restrict how much you drive

Limiting the amount of time you’re on the road obviously reduces your risk and with it, your premium. Most insurers will ask you for a mileage limit, so set this as low as you think you can comfortably achieve. Just make sure you’re being truthful – if you make a claim and you’ve considerably underestimated your mileage, you could end up with a void policy.

7) Drive well

If you make sure you drive well from day one, it could lead to lower premiums. Your premium will increase if you start to get penalty points or if you have an accident. But if something does go wrong and you do receive some points, make sure you tell the insurer. It could affect your premium, and might invalidate your policy if you don’t make them aware. 

Interested in telematics?

You might also be interested in getting a telematics insurance policy. This refers to a black box, a gadget placed in the car, or an app for your phone that relays details of how you’re driving to your insurer. If you drive well, they could reward you with lower premiums.

We know that insuring your vehicle for the first time is expensive. To see if you can save some money, start comparing now.  

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