Spending less on a first car combined with lower insurance premiums leads to an 11% drop, but parents still think that young driver insurance premiums are a ‘rip-off’
- Average cheapest annual car insurance premium for a 17 year old is down to £1,994 from £2,035 last year
- Almost a quarter (24%) of parents help towards the cost of car insurance for their children
- 60% of parents think that young driver insurance premiums are a ‘rip-off’
- Gocompare.com offers its top six tips to help younger drivers keep their premiums down
New research* from Gocompare.com Car Insurance has revealed that the cost of getting a young driver on the road has fallen by 11% to £5,733, compared to £6,455 last year**. The £722 drop can be attributed to a significant reduction in the amount of money being spent on first cars plus a £41 drop in the average cheapest car insurance premium for a 17 year old driver.
The average cheapest car insurance premium for a 17 year old driver has fallen by around 19% since 2009, moving from £2,477 then to £1,994 now. However, the cost of car insurance for a 17 year old driver still constitutes over one third of the total ‘new driver’ bill.
Over half (53%) of parents said the cost of car insurance is a major concern with 12% saying that their child has delayed getting a first car specifically because of the cost of insurance. After safety, the cost of car insurance is parents’ biggest concern when their child is learning to drive and 30% said that the cost was far greater than expected.
To help keep the cost of getting on the road in check, young drivers and parents are spending on average £3,006 on a first car, a substantial drop from £3,685 last year. However, this is still over £500 more than the average of £2,477 spent on a first car in 2009.
The survey of 1,000 parents revealed that most give their children a significant amount of financial help to get them on the road:
- Two thirds (66%)said that they have contributed to the cost of driving lessons,
- 62% have paid or intend to pay towards the cost of a first car for their child,
- 24% have helped or intend to help with insurance costs,
- However, 14% said they haven’t given or won’t be giving their child any financial help to get them on the road.
Matt Oliver, car insurance spokesperson for Gocompare.com, said: “The cost of car insurance makes up a significant proportion of the cost of getting a young driver on the road, so it’s good to see that the average premium for 17 year old drivers is continuing to fall. However, it remains to be seen whether recent changes to the personal injury discount rate, or Ogden rate, will reverse this trend over the next year.
“While many people feel that young drivers are treated unfairly when it comes to insurance premiums, unfortunately, statistics show that newly qualified drivers are more likely to have an accident. These accidents also tend to be more serious in nature, resulting in more expensive claims - hence the higher premiums.
Matt continued: “But younger drivers can help to lower their insurance premiums by choosing the right car. This can make a big difference as sporty cars with larger engines cost a lot more to insure than basic models with engines of less than 1000cc. Choosing a telematics or ‘black box’ insurance policy, which monitors their driving, will help young drivers prove that they can drive safely which in turn could help to reduce their premium.”
Choose a sensible car - Young drivers’ insurance premiums will be lower if they drive a standard car with a small engine in a low insurance group. It may not be a supercar but it makes sense to drive something smaller and slower until they’ve built up some no claims bonus and have shown a safe driving record. Also, avoid cars with modifications, as they can push the price of insurance up.
Consider opting for a higher excess – This may lower your premium but you will need to decide if paying a lower premium is worth the risk of having to contribute more towards the cost of a claim if you have an accident.
Thought about a ‘telematics’ policy? – Some policies require your car to be fitted with a ‘black box’ transmitter and others do a similar job with a smartphone app. In both cases the idea is that your driving is monitored by the insurer and your premiums can come down faster than with a traditional policy if you prove to be a safe driver.
Added extras – consider whether you really need added extras such as a courtesy car, legal assistance, breakdown cover and key cover. Some policies include these types of cover as standard or as add-ons but they’re not free – the cost will be built into the premium so you may be able to save money by removing them or choosing a different policy without all the bells and whistles.
Adding a safe driver – Adding another named driver with a clean licence and several years’ claim-free driving to a young driver’s policy could reduce their premium. This is one way a parent can help their child to get lower premiums without breaking the law.
Drive safely – By being careful on the road you will avoid accidents, fines and penalty points, all of which will affect your insurance premium.
Gocompare.com has produced a guide to learner and new drivers' car insurance.
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Notes to editors:
*Between the 8th and 14th February 2017 One Poll conducted an online survey among 1000 randomly selected British adults with children aged between 17 and 25 who can drive.
**£5,733 figure is based on the following: provisional licence (apply online) £34**; driving lessons (21 lessons at £24** per lesson – Source AA) £504; driving test fees - theory test (weekdays) £23**, practical test (weekdays) £62**; average cost of first car £3,006; car tax (Vehicle Excise Duty) £110 per year** based on a 2012 Vauxhall Corsa 1.2 SXi; one year’s fully comprehensive car insurance £1,994 based on Gocompare.com’s average cheapest quote for 17 year olds from the 1st of January 2017 upto and including the 19th March 2017.
***£623 = £504 (driving lessons) + £34 provisional licence (if apply online) + £85 driving test fees
Source: *DirectGov, ***The AA