Why is car insurance for young drivers so high?

cartoon angry kid on the street

Posted by Holly West-Robinson on 23 May 2017

Admittedly, it can be difficult for a young driver to get on the road in this day in age. You spend all that money taking lessons and practising - finally pass, get your hands on an awesome little motor and then come to realise that it’s going to cost you an arm and a leg to be able to drive it…

Not only is the cost of insurance a concern, you’ve also got to fork out for servicing, maintenance, tax, MOT and petrol. When all added up, it’s enough to put most people off even wanting to drive, especially if they are a student or not on the greatest income in the world. But there are valid reasons why car insurance premiums are so excessive for young people.

How is car insurance calculated?

It all comes down to risk. Insurers take into account the type of vehicle including its engine size, age, value and how many miles it’s done. Most importantly insurers look at who’s driving the car. Because at the end of the day it’s not the cars that are the MAIN risk, it’s the drivers. This is why things like your age, postcode, and how many years you have been driving are all taken into account.

Some of these things may seem a bit unfair. After all you can’t help how old you are, and not all of us can afford to live somewhere like Kensington Palace or Mayfair Street! But when it does come down to the areas we live in, insurers aren’t penalising you as a person for residing there, it’s mainly due to things like high crime rates, collision risks (if you live in a built up part of town), uninsured drivers and overall amount of claims.

Why are young drivers considered such a high risk?

When an assessment is carried out on an actual person, it’s much harder for companies to determine what kind of driver they are. Obviously insurers cannot evaluate every single detail about a customer, so they have to ask for top line information and base the premiums generated on statistics and facts.

It has been statistically proven that young drivers make up a staggering 25% of all fatal collisions on UK roads, and are also much more likely to have an accident within the first year of driving. This is why a 17 year old with zero No Claims Bonus earned and hardly any experience on the road, is naturally going to pay more than a 40 year old who has been driving for 20+ years with countless years of No Claims Bonus under their belt. The more experience a young person has on the road, and the longer they go without making a claim, the less they will pay for their cover.

What other things are factored into young drivers insurance premiums?   

A person’s occupation can also have an effect on what they pay for their insurance. If you were working in a job which required you to do a lot of driving such as delivery or taxi driver, again you are likely to be more at risk of an accident because you are generally on the road a lot more than someone who commutes 5-10 miles a day to their job.

The number of miles you expect to drive is another thing that is taken into account - as well as previous convictions and claims. Most young people (you would hope) wouldn’t have either of those when they are new to the road – but you would be surprised at how many calls we get from people looking for cover, who have been pulled up for speeding within the first few months of driving!

Why some vehicles cost more to insure than others

via GIPHY

Companies look at the factors we’ve detailed above, when it comes down to you as a person. But those aren’t the only things that are factored in when generating an insurance quote. The car the person chooses to drive can also play a big part in the price. Flashy, high performance cars with large engines and modifications will cost you a tonne more to insure than a little box standard 1.0L - simply because they are more powerful and of much greater appeal to thieves. Large, expensive cars also cost a lot more to repair!

The car’s age is also a factor, because newer cars are built with more safety features and are generally more reliable than older cars. These days you can get some very reasonable deals for new cars on finance which come with some great benefits! Most new cars come with a 5 year warranty as well as free tax for the first year. Not only that but you don’t have to have an MOT until they are 3 years old!

What can I do to get cheaper car insurance?

  • Avoiding the suped-up dragsters and opting for a small, reliable run-around with low miles is a great start!
  • By adding a parent as an additional driver onto your policy, some companies will offer you a discount on your insurance, providing they have a clean driving record, and no previous claims.
  • Black box insurance is another great way of keeping the costs to a minimum and helping you to develop safer driving skills. Companies base your premiums on how well you drive and generally offer discounts or rewards for driving in a safe manner.

Remember – it may seem like you’ve got it tough as a youth on the road right now, but over time and as you build up your no claims bonus, your premiums will become less and less. Most of our own drivers’ safe up to 33% on average at their renewal… and that’s after 1 year! So after 2 or 3, you’ll most certainly start to see a healthy reduction in price as you gain experience and continue to drive well! :)

About the Author

Holly West-Robinson
Holly West-Robinson

Hi I'm Holly and I'm a young driver based in Peterborough! I love tattoos, food, drawing and anything art related, enjoy hanging out with friends and family and making a fool of myself XD I'm a huge lover of music and also a part time DJ in the underground drum and bass scene. I passed my driving test first time when I was 17 years old have been loving life and my new found freedom ever since! I'm definitely one of the adventurous types who's always up for a good old road trip!