Car Insurance for young and new drivers

According to data from MoneySuperMarket, which is accurate as of January 2021, car insurance costs 17-24-year-olds an average of £1,977 for vehicles fitted without telematic devices. Without a doubt, car insurance will be one of the highest costs that young and new drivers have to factor into their decision making when shopping around for their first car.

One of the key factors which determine the price of car insurance is age and experience. Insurance works by calculating the possibility of risk – therefore, new and inexperienced drivers are simply a more significant risk. Statistics show an increased probability that a reasonably new driver could be involved in an accident due to a lack of experience or poor driving standards.

For example, statistics from the AA and the Department of Transport show that young or new drivers are a third more likely to die in an accident compared to more experienced drivers and that as many as 23% of new drivers are involved in an accident in their first two years of driving.

However, the longer you drive, and the more years you build up your no claims discount or bonus, the lower your premiums should become. If you’re aged 17 to 24, you should shop around for ‘Young Driver’ insurance.

The insurance company will likely insist that you have a telematics/black box device installed in the vehicle so it can record your driving behaviour, including how fast you drive, how quickly you brake, and the distance you go. However, this is an excellent way to lower the expensive premiums for young drivers, and insurers will reward young drivers for driving sensibly.

Another way to include reducing your annual insurance premium is to increase the voluntary excess payment, which is the amount of money you have to pay when making a claim. Doing this shows insurance providers that you’re less likely to make a false claim as you’d be adversely impacted by paying the higher excess amount.

Adding an experienced driver onto your insurance policy will demonstrate to the insurer that it won’t be just you using the vehicle, and the premium should decrease.

It is also essential to consider which insurance group the car falls into. There are 50 insurance groups in total, with one being the lowest (and cheapest) and fifty highest. You will want to try and find a vehicle that falls into one of the lower insurance groups to try and keep your insurance premium as low as possible.

You can check which insurance group is allocated to a vehicle by using the following tool provided by Thatcham Research.

Car Tax

Officially known as the Vehicle Excise Duty (VED) it’s more often referred to as car tax.

If your car was first registered between 1 March 2001 and 1 April 2017, the cost of the tax depends on how much CO2 it emits. This will be shown on the V5C registration document. For cars registered before 1 March 2001 VED is based on the size of the engine.

You should look at how much car tax will cost you before buying a car. The cleanest cars may not pay any VED - for example, most electric cars don't.

For newer cars (registered since April 2017), there's a standard rate of VED that applies to all but the cleanest cars.

However, with Personal Contract Hire, car tax is normally included in the contract so it’s one less thing to worry about paying for.

MOT

Once a car is older than 3 years old it must undergo an annual MOT inspection to ensure the vehicle is still roadworthy and meets minimum safety requirements. Any maintenance needed to make the car fit for driving and to pass the inspection has to be carried out. This can include brakes, tyres and headlamps. The car must pass the test to be allowed on the road.

If you lease a car through Fleet UK the good news is that you probably won’t have to worry about getting your new or nearly-new vehicle MOT’d if your contract is two years long.

Servicing

The vast majority of vehicles need servicing annually. During the service, it’s typical for the engine oil and filters to be changed and any scheduled maintenance will be taken care of. The car should receive a mechanical once-over to ensure it’s in good condition.

Depending on the type of vehicle service you have, the costs will vary from as little as £150 to several hundred pounds should any parts need to be replaced.

If you lease a car through personal contract hire you can take out an optional maintenance contract for a monthly payment to cover the cost of servicing, replacement tyres and other repair costs. Another benefit of leasing a new or nearly-new vehicle is that it will also have the manufacturer’s warranty.

Tyres

Tyres can be another big expense so it’s best to get the most out of them. With some careful driving and regular checks, you should be able to get around 20,000 miles out of front tyres on a front-wheel vehicle and around double that for rear tyres.

You should:
• Check tyre pressures regularly – both under and over-inflation can increase wear and tear
• Check for uneven tread wear – either incorrect wheel alignment or having a worn suspension can contribute towards cutting tyre life and fuel consumption can increase as well
• Drive carefully – try to drive gently to avoid hard braking and cornering

And while tyres might seem like one of the most boring purchases you’ll have to make, they are the only link between you and the road surface, so don’t be persuaded to buy part worn tyres to save a few quid as many have dangerous defects – it’s just not worth putting your life and others at risk.

Easy ways to cut the cost of driving

Once you’ve bought your car and it’s taxed, insured and ready to rack up some miles, there are some steps you can take to lower the cost of driving:

• Don't delay or skip regular servicing – it keeps your car running at its best and will pick up any faults early
• Remember to check tyre pressures, engine coolant and the oil level every couple of weeks or so
• You could consider a hybrid or electric car as they are cheaper to run with lower maintenance and fuel costs