The cost to run a car for drivers under the age of 25 have fallen by £386 since November 2024, from £2,846 to £2,460 in November 2025.
During the same period, average car insurance premiums fell by £393 – from £1770 to £1377
Ahead of renewing their insurance, it’s a good idea for young drivers to shop around to search for a policy that suits their needs and budget.
10th December 2025 – Car costs for drivers under the age of 25 have fallen by £386 year-on-year, driven by a fall in insurance premiums according to research conducted by Compare the Market.
The average cost of driving – including car insurance, fuel, road tax and annual MOT costs – was £2,460 in November 2025, down 13% from £2,846 in November 2024.
During the same period, car insurance premiums fell by £393 – from £1770 to £1377. Car insurance now represents 56% of total car running costs for young drivers, compared to 62.2% last year.
Premiums have been on a downward trajectory in recent years. In August, they hit a two-year low of £1,336. In September and October, premiums rose slightly– by £119. But then in November they fell again, putting current premiums now just £41 above their record August low.
Compare the Market: Annual cost of running a car for a young driver (aged under 25)
Cost | 2024 | 2025 | % of total cost (2025) |
|---|---|---|---|
Car Insurance | £1,770 | £1,377 | 56% |
Fuel | £831 | £833 | 33.9% |
Est. VED (Road Tax) | £190 | £195 | 7.9% |
MOT | £55 | £55 | 2.2% |
Total cost per year | £2,846 | £2,460 | 100% |
As premiums are declining, young drivers who shop around before renewing their car insurance could find potential savings by switching.
Shopping around and comparing prices online could help motorists to save even more on their MOTs, servicing, and repairs services with access to thousands of garages nationwide through Compare the Market.
Amy Rootham, Insurance Expert at Compare the Market, comments: These figures show an ease on the financial pressure young drivers have faced in recent years, with overall motoring costs dropping by nearly £400 since November 2024. Despite the decline in insurance premiums, it’s still a good idea for young drivers to compare insurance prices online before renewing, as they could save by switching or finding a policy that is more suitable for their requirements.
For further tips on how to save money on car insurance, visit: Compare the Market's tips on how the get cheaper car insurance
Notes to editors
Fuel cost
Annual fuel costs based on drivers travelling 7,000 miles per year (ONS NTS0901 – Average All Cars: total annual mileage 2023)
Petrol priced at £1.45 per litre in March 2024 and £1.38 in March 2025 (Source: BEIS Monthly: Typical/average annual retail prices of petroleum products and a crude oil price index (tab 4.1.1 quarterly).
Fuel efficiency is 5.40 litres per 100km as of 2020 (Source: Department for Transport ENV0103)
MOT cost
Cost for a car - £54.85 (source: https://www.gov.uk/getting-an-mot/mot-test-fees )
Vehicle Tax Rate
Petrol car registered on or after 1 April 2017. Rates for second tax payment onwards. Single 12 month payment - £195 source: https://www.gov.uk/vehicle-tax-rate-tables
