What type of car insurance does a new driver need?
There are three main types of cover to consider when applying for new driver car insurance:
- Third party. This is the minimum level of insurance you require to legally drive on public roads. It covers the cost of compensating others for any damage or injury you cause to them or their vehicle. However, you won’t be covered for the cost of any damage to your own car.
- Third party, fire and theft. This covers the cost of damage or injury to third parties, but you could also be covered if your car is stolen or damaged by fire.
- Fully comprehensive. This is the highest level of insurance available and it can give you the most protection. Cover includes third party, fire and theft, plus any other damage to you or your own vehicle. Even though it’s the most comprehensive cover, it often works out cheaper than third party only insurance. That’s because it’s more widely offered and tends to be taken out by the safest drivers.
How much does car insurance cost for a new driver?
One of your biggest expenses when buying a car for the first time will be your car insurance. As a new driver, you’ll pay more for your cover than an experienced driver. That’s because there’s a bigger risk of new drivers being involved in a collision than motorists who’ve been driving for a number of years.
Based on Compare the Market’s data, the average cost of car insurance for drivers under 25 is £1,085. This compares with an average car insurance premium of £631 for motorists across all age groups, according to our latest Premium Drivers Index.
Why is car insurance for new drivers so expensive?
While inexperience plays a big role in the cost of car insurance for new drivers, even more important is the fact that most new drivers are young drivers, between the ages of 17 and 24.
Statistics have shown that drivers under the age of 25, who’ve recently passed their test, are more likely to be involved in an accident. According to the most recent Department for Transport data, the casualty rate for young car drivers 2019 was more than double the overall rate for car motorists aged 25-79, in terms of distance travelled.
More recently, the government-backed THINK! Campaign, aimed at promoting road safety, revealed that one in five drivers crash in the first year after passing their test. Research for the campaign shows that many new drivers feel vulnerable behind the wheel. This can lead to defensive driving and taking unnecessary risks to ‘over-compensate’ for their lack of experience. Even if you drive safely from day one, statistically, as a new driver, you’re considered a higher risk and the price of your premium will reflect this.
Another thing that could bump up your premiums is the fact that, because it’s your first policy, you’ve had no opportunity to build up a no claims bonus, which could help you reduce the cost of your car insurance further down the line. The good news is there are ways to reduce the cost of your insurance, even as a first-time applicant.
What other insurance options are there for a new driver?
Just like for any car insurance policy, there are various extras you can add to your new driver insurance. Once you’ve compared insurance providers to find a cheap car insurance deal, you can then select the policy extras that are important to you. Examples include:
- Breakdown cover – it’s not unusual for new drivers to buy cheaper or second-hand cars, which might be older and more likely to break down. Breakdown cover is one of the most common extras, allowing you to get back on the road as soon as possible.
- Courtesy car cover – if you’re unlucky enough to be in an accident and your car is in the garage for repairs, courtesy car cover will provide you with a new set of wheels while yours get fixed.
- Personal accident cover – if you don’t choose comprehensive cover, this is an extra you could consider. Personal accident cover can be used to claim for compensation if you or a passenger are killed or seriously injured in an accident.
Can black box insurance save new drivers money?
If you drive safely, a black box policy, also known as telematics insurance, can help young first-time drivers to lower their premiums. Our figures show that a telematics policy is cheaper than a non-telematics policy in 60% of enquires from drivers aged 17-20.*
Your insurance provider will monitor your driving habits, either through a small black box installed under your dashboard, a plug-in device or an app on your smartphone. The telematics will track things like your speed, acceleration, braking and location. Your insurance provider can then use this information to adjust your premiums based on how you drive. The more responsible you are behind the wheel, the lower your premiums are likely to be in the future.
You’ll also be able to see your black box data on your insurance provider’s website or app. This allows you to see whether there are areas you could improve, so you can adjust your driving habits and potentially get a lower premium.
*A telematics policy is cheaper in 67% of enquiries from 17 to 20-year-olds, based on Compare the Market data for 1 January 2021 to 1 April 2021
Will adding another driver to my policy reduce the cost?
If you’re a new driver and share your vehicle with a more experienced motorist, adding this person as a named driver might save you money. Because you’ll theoretically be spending less time driving the car, your insurance provider may adjust your premiums to reflect this.
Even an experienced driver with a good record, who only drives your car occasionally, could make a difference. But you need to be honest about who’s the main driver of your car. If say you’ve claimed that your mum or dad is the main driver but they’re not and you’re really the person who drives the car all the time, you could be found guilty of 'fronting', which is a type of insurance fraud. At the very least, you could invalidate your policy and at the worst you could be prosecuted and end up with a criminal conviction.
How can I get cheaper car insurance as a new driver?
Even as a new driver, there are ways to potentially reduce the cost of your car insurance. Here’s how:
- Compare car insurance quotes. You’ll have a better chance of finding a great deal that suits your needs if you compare new driver car insurance quotes from a number of different insurance providers. Comparing quotes with Compare the Market is quick and easy.
- Choose your car with care. When choosing your first car, you might dream of owning a high-powered motor, your insurance premium will probably be more affordable if you opt for a standard car with a smaller engine. For more information, see our guide to the cheapest cars to insure.
- Consider a black box policy. Telematics insurance uses clever technology to show your insurance provider how you drive. A small device is fitted to your car, or sometimes you download an app to your phone, which measures when, where and how you drive. Your provider then uses this information to accurately calculate or adjust your premium. Drive safely and the reward could be cheaper car insurance.
- Steer clear of modifications. Try to avoid adding unnecessary modifications to your car, such as alloy wheels or a spoiler. Even the smallest mods could bump up your premium. Some insurance providers may even refuse to insure you.
- Increase your car’s security. If you reduce the risk of your car being stolen, by fitting an immobiliser or alarm for example, your insurance provider may offer you cheaper cover. Just bear in mind that you may have to speak directly with your insurance provider to get this saving.
- Reduce your annual mileage. If you can limit the time you spend on the road, you’ll be seen as a lower risk to your insurance provider, which could reward you with a cheaper premium.
- Pay annually. If you can afford to pay for your car insurance up front, it’s usually cheaper than paying in monthly instalments.
- Pay a higher excess. If you’re willing to pay more towards any claims you might make with a higher excess, this can make your insurance premiums cheaper.
- Pass an advanced driving course. If you can prove that you’re a safer driver, insurance providers may reward you with a cheaper premium. Advanced driving courses, like Pass Plus, are a way to show your insurance provider that you have more experience and training, despite being a new driver.
How long are you considered a new driver?
It’s hard to say, as different insurance companies will have different views. However, a new driver is essentially someone who’s just passed their driving test and has no driving history. Therefore, once you start building a no-claims bonus, you should start to see your car insurance get cheaper.
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New drivers’ car insurance on a company car
If you are given a company car by your employer, you might not need to take out your own car insurance, as the car could be insured by the company you work for. However, make sure you check this with your employer, and let them know that you’re a new driver, as this may make a difference.
Frequently asked questions
Should I add any extras to my car insurance?
Although optional extras can give you more protection, you might have to pay for them in addition to your standard policy. This could push up the overall cost of your premium which, as a newb driver, is expensive enough already.
Before you consider taking out any additional cover, ask yourself, ‘do I really need it?’.
Most providers offer a range of optional extras such as:
- Windscreen cover – covers the cost of repairing or replacing a damaged windscreen
- Courtesy car cover – a replacement car while yours is being repaired
- Personal accident cover – a lump-sum pay-out if you’re seriously injured or killed in a road accident
- Key cover – covers the cost of replacing your keys or fob if they’re lost, damaged or stolen
- Legal protection – can help cover legal costs if a claim is made against you or you’re accused of a motoring offence
- Misfuelling cover – covers repair costs if you put the wrong fuel in your car
Depending on the policy, some of these might already be included as standard. That’s why it’s always a good idea to compare deals so you can work out which is better value for money.
What about breakdown cover?
One added extra you might want to consider is breakdown cover. It gives you the peace of mind that help is on the way if something goes wrong on the road.
Most car insurance providers offer breakdown cover as an optional extra, or you can buy your own cover directly from a breakdown provider. Just check in case you’re already covered – some bank accounts include breakdown cover as do many car dealership packages.
What’s the difference between compulsory and voluntary excess?
In insurance speak, the compulsory excess on a policy is the amount of money you’ll need to pay when you come to make a claim. This figure is set by the insurance provider.
Then there’s the voluntary excess in addition to this, which you can set yourself. Increasing your excess to an amount you’re sure you can afford could help to reduce your premium. If you do need to make a claim, you’ll have to pay the compulsory and the voluntary excesses together, so make sure you can afford the total.
Is a higher voluntary excess better?
If you want to reduce your car insurance premium, a higher voluntary excess could help. But remember – if you make a claim, you’ll have to pay more towards it.
What’s a no-claims bonus?
A no-claims bonus is a discount you earn for every year you drive without having to make a car-insurance claim. You can start to build up a no-claims bonus from your first year as a qualified driver. The longer you drive without claiming, the bigger your car insurance discount could be.
You can protect your no-claims bonus so you can make a set number of claims per year without your discount being affected. You’ll have to pay extra on top of your car insurance to do this.
Is it better to pay monthly or annually?
An annual lump sum payment will usually work out cheaper than monthly instalments. That’s because interest is added to your monthly payments. However, paying monthly can be helpful if you’d rather spread the cost. New drivers in particular may find this the easiest way to manage their finances, as their total premium may be considerable.
If you’re 17 you can’t apply for credit in the UK, so you might have to see if you can find an insurance provider offering a rolling one-month contract instead. If your birthday is not far off, you might consider getting temporary insurance, say one month at a time, and then applying to pay monthly when you can.
However, this could work out more expensive than just paying it all in advance. But it might be worth doing the sums and seeing what’s best for you.
Do driving courses lower the cost of insurance for new drivers?
Advanced driving courses that you can take after passing your test, for example Pass Plus or IAM RoadSmart, are designed to improve your skills and safety behind the wheel. While some new drivers may be able to get a discount on their insurance with extra training under their belt, it’s not guaranteed. And even if your insurance provider does offer a reduced premium, the saving you make might be less than the cost of the course itself. It’s best to check to see if the saving outweighs what you’ll spend on the course.
Is it worth taking a Pass Plus course?
The government’s Pass Plus course is designed to help newly qualified drivers improve their driving skills and safety on the road.
Even if you use probationary (P) plates to show you’ve just passed your driving test, the first few months as a qualified driver can still be pretty daunting. Pass Plus can help boost your confidence and get you used to driving on different types of roads and in all-weather conditions. It’s a great way to build your skills while learning to be a safer driver.
There’s no guarantee that taking a Pass Plus course will reduce your car insurance. But learning to drive safely and confidently could lower the risk of you having an accident. The skills you learn at the very beginning will help you become a better driver, and over time this could mean cheaper car insurance.
Car insurance fronting is when an experienced driver claims to be the ‘main driver’ on an insurance policy, but it’s actually the less experienced driver who does most of the driving. People do this to try to cut the cost of the younger person’s car insurance.
For example, if your parents take out a car-insurance policy and add you as a named driver, but you’re the one who uses the car on a daily basis, then that is fronting. It’s considered fraud, and is illegal.
If you’re found guilty of fronting you could face a substantial fine and get six penalty points on your licence – if you’ve had your licence for less than two years, it’s enough for an instant driving ban. Your licence will be cancelled and you’ll have to take your test again. You’ll also find it difficult to get affordable car insurance in the future.
It may be that you’re fronting without realising it. But ignorance is no excuse – if you’re in any doubt, speak to your insurance provider.
What else could affect the cost of my car insurance?
Less obvious things, like where you park your car or how many miles you do each year, can also affect the cost of your car insurance. Parking your car overnight on the street means there’s more risk of it being damaged or stolen. And the more miles you drive over the course of a year means there’s more chance of being involved in an accident.
A speeding fine can also impact your car insurance, especially if you’re a new driver. Be aware that six penalty points on your licence within the first two years of passing your test could also result in an instant driving ban.
What is the cheapest car for a 17-year-old to insure?
The cheapest car to insure for young drivers is something that will change regularly, so you should always be comparing car insurance quotes to find the best deal for you. However, according to Compare the Market data, the cheapest car to insure for 17-24-year-olds is the Volkswagen Up! with an average premium of £636**.
**Average price amount based on Compare the Market data from November 2020 to January 2021, where total enquiries are over 1,000. The average is based on all variations of the vehicle model and uses risk data from people with different age ranges, addresses and driving histories. You may find a cheaper or more expensive quote based on your circumstances.
Does a learner driver need insurance?
Yes, learner drivers still need to be insured. This can include being added to a friend or family member’s policy as a named driver, or you can take out separate learner driver insurance. Just remember, learner driver insurance only covers you as long as you’re a learner. The moment you pass your driving test, the insurance will no longer be valid and you’ll need a new policy.
Does your age impact your car insurance?
Unfortunately, being a younger driver does usually make your car insurance more expensive. This is because young drivers don’t have as much experience on the road, which means they’re at a higher risk of being in an accident. As you get that experience, your insurance tends to get cheaper. However, as you start getting older (80+), it can start to get more expensive again, because elderly drivers are also a higher risk.
Can you lower your car insurance by buying a cheaper car?
Buying a cheaper car can make your car insurance cheaper because it could mean your insurance provider won’t need to pay out as much if your car was written off. However, it can work both ways. If you’re buying a cheap car because it’s really old, this could be a red flag to insurance providers, who might see it as a greater risk in terms of it breaking down or not having modern safety features.
If you’re looking for cars which are cheaper to insure, have a look at our car insurance group checker.
Why should I compare car insurance?
The price of car insurance can come as a nasty shock when you’re a newly qualified driver. Not only is it eye-wateringly expensive, but there’s also a whole load of new insurance jargon to learn.
By taking a few minutes to shop around and compare different quotes, young drivers could save £201^ by finding a cheaper deal. We’ve also made it easier to compare quotes by including key features of each policy.
And while it’s important to read the terms and conditions of your policy, car-insurance jargon can be mind-boggling when you’re just starting out. If you’re not sure what all the terms mean, check out our handy car insurance glossary for an easy go-to reference guide.
What do I need to get a quote?
To find your first car insurance policy, just fill in our online form and we’ll show you a list of quotes to choose from. We’ll need a few details about you and your car, including:
- Your car registration
- What you use your car for
- Where you keep your car
- Your annual mileage
- Where you live
- Your driving history
Why compare first-time driver insurance with Compare the Market?
We independently compare a wide range of the UK’s insurance providers, to provide new and young drivers with competitive car insurance deals.
We’ll show you policies based on price, cover level, add-ons and annual or monthly payment terms, helping you compare policies based on your needs.
We compare prices for 141 car insurance products^^
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51% of young drivers could achieve an annual premium of £1,069^^^
^^Correct as of September 2021.
^^^50% of young drivers between 17-24 years old could achieve a quote of up to £1063 for their car insurance based on Compare the Market data in June 2021.
From the Motor team
What our expert says...
“The make and model of car you drive also has an impact on how much insurance you pay. Each car is assigned an insurance group from 1 to 50, with the cheapest cars to insure falling into the lowest groups. So, if you’re a new driver, it’s worth bearing this in mind when choosing your first car, to help keep your running costs down.”