First time young drivers car insurance
- State Car Insurance Requirements
- Optional Coverages
- Car Insurance Rates and Premiums
- Car Insurance Limits
- Car Insurance Deductibles
- How to Shop for Insurance
- Research Car Insurance Companies
- Getting Car Insurance Quotes
- Tips to Find Cheap Car Insurance
- Manufacturer-backed young driver insurance deals
- Where should I look for cheaper car insurance?
- What is black box car insurance?
- Can my parents help to lower my car insurance quote?
- What’s the best car to buy to get cheaper car insurance?
- Do I have to pay for my car insurance up front?
- Car insurance jargon explained
- First Cars on Auto Express...
- Cars for Teen Drivers
- Insurance for College Students
State Car Insurance Requirements
Before you hit the road, understand that nearly every state requires some form of financial responsibility from drivers. Most states require a minimum amount of car insurance, though some states allow drivers to prove financial responsibility via other means, such as filing a surety bond of a certain amount.
Liability insurance is a two-fold type of coverage:
- Bodily injury coverage: This covers injuries suffered by another person during an auto accident.
- Property damage coverage: This covers damage to another person's property during an auto accident.
Note that liability insurance doesn’t cover you or your car—unless you’re the injured party (and even then, it’s the other person’s insurance that covers you). Thus, it’s important to consider other types of optional coverage (see “Optional Coverages” below).
Because your car insurance provider is licensed to sell insurance in your state, your agent is schooled on your state’s minimum liability insurance requirements; still, you can prepare yourself by choosing your state in our section on Car Insurance.
There are many different kinds of additional coverage you can add on to your car insurance policy, and you can discuss additional coverage types with your insurance agent, who will talk with you about your specific needs.
Below are three of the most common types of additional coverage that drivers request.
1) Collision and Comprehensive Coverage
Generally, collision and comprehensive coverages are optional―unless you leased or financed your vehicle and your lender requires these coverage types until you pay off your loan.
Where liability insurance covers damages to other people's property, collision and comprehensive is considered physical damage coverage and protects your property.
- Collision insurance: This insurance covers damages to your own vehicle in the event of a collision.
- Comprehensive insurance: This insurance covers damages to your vehicle in the event of theft, vandalism, natural disasters, animal collisions, and weather conditions.
Purchasing these two types of coverage is a good idea even if you're not required to do so. It can be especially useful if you live in a large metropolitan area, or you often commute in heavy traffic.
However, if your vehicle is older, collision and comprehensive insurance might not pay off; in the long run, you could end up paying more in premiums than you would to repair your vehicle.
If you are like many first-time drivers, your first car will probably be second-hand or low-value, so you might want to avoid these coverages. Also, remember that this may be just another reason to avoid that flashy new car. A cheaper car probably doesn’t need as much coverage, so you’ll save money on the purchase AND on your insurance!
2) Underinsured and Uninsured Motorist Coverage
Uninsured and underinsured motorist coverage protects you in the case that you get hit by a driver who doesn’t have coverage to pay for your damages and/or injuries.
- Underinsured motorist coverage: This insurance protects you if you're involved in an accident with a driver who doesn’t have high enough insurance limits to cover the damages sustained.
- Uninsured motorist coverage: This insurance protects you if you're involved in an accident with a driver who has no coverage.
3) Personal Injury Protection (PIP)
Similar to underinsured motorist coverage, personal injury protection (PIP insurance) is a medical coverage that covers the cost of your own medical expenses related to an accident, whether or not you were at fault.
PIP insurance coverage allows you to get your medical bills paid without having to wait for the conclusion of a lengthy accident investigation.
PIP is also referred to as no-fault coverage, and is required in some states. Check our Car Insurance section to see what types of insurance you must buy in your state.
There are multiple other types of coverages. These include:
- Medical payments coverage.
- Rental reimbursement coverage.
- Towing and labor coverage.
- Emergency roadside assistance coverage.
Visit our Auto Insurance Coverages section to learn all about the types of coverages available from most car insurance companies.
Car Insurance Rates and Premiums
Your car insurance rate, or premium, is the payment you make to have car insurance coverage.
Rates vary from provider to provider, but some of the most common factors car insurance companies use when determining your insurance rates include:
- The amount and type(s) of coverage you want (and need).
- Your driving record, also known as a motor vehicle record (MVR). Your MVR is a record of your driving history and helps car insurance companies determine the risk involved when insuring you. MVRs provide information including your:
- Current driver license status.
- Any traffic violations (including the associated driving record points).
- Any at-fault accidents in which you’ve been involved.
- Your vehicle. This includes factors such as:
- The make and model.
- How at risk the vehicle is for being stolen or vandalized.
- How much it would cost to repair the vehicle.
- How many (if any) safety features the vehicle has installed.
- The vehicle’s overall safety rating.
- Where you park your vehicle (specifically, how safe the location is).
- Where you live. Vehicles in urban areas notoriously are more expensive to insure than those in rural areas.
- How often you drive. Vehicle owners who don’t drive much tend to get lower rates than those who spend a lot of time behind the wheel.
- Your credit score. Many auto insurance companies determine factors such as how likely you are to make payments on time or file a complaint based on your credit history.
- Some personal information, such as your age and gender.
- For example, females 25 years old and older tend to get lower premiums because they belong to two groups less likely to become involved in accidents: women and drivers over 25.
Again, because providers’ rates vary, it’s important to shop around for car insurance coverage. Get quotes from a variety of companies before choosing the best insurance policy and rates for you.
See “How to Shop for Insurance” below for more details.
Car Insurance Limits
Your car insurance limit is the highest amount of coverage your company provides on a specific coverage.
For example, if your collision limit is $10,000 and you incur $15,000 in damages to your vehicle, your car insurance company will pay $10,000 and you’ll be responsible for the remaining $5,000.
Sometimes, you’ll see policies written with two numbers, such as 50/100. For example, if your bodily injury liability coverage is written as such, it means that it will pay:
- $50,000 maximum for bodily injury to a single driver in an accident you cause.
- $100,000 maximum for bodily injury to multiple people in an accident you cause.
Increasing your limits means your car insurance company will cover more of the costs, but increasing your limits often means increasing your rates, too. Make such a decision based on how much you can reasonably afford to pay in premiums.
Car Insurance Deductibles
A car insurance deductible is the out-of-pocket amount of money a driver pays before his car insurance coverage will kick in to pay a claim.
For example, let’s say you have an accident and rack up $2,500 worth of damage to your car. If your deductible is $1,000:
- You pay $1,000 toward the damage repair.
- Your insurance company picks up the remaining $1,500.
Typically, the higher the premium, the lower the deductible, and vice versa.
Although choosing a higher deductible so you can get a lower premium seems like a good idea, it’s not always financially responsible. Why? You might have to pay that deductible some day, and if it’s too high (especially depending on where you are in life), you might no be able to afford it.
Always be mindful when choosing your deductible about whether you can reasonably afford to pay it if you get into an accident.
How to Shop for Insurance
You probably already know you can directly shop for car insurance online or in person, but did you know there are even more thorough ways to go about it?
For example, you might use an agent or a broker when shopping for auto coverage.
Generally, car insurance agents work with specific companies; on the flip-side, brokers (sometimes referred to as independent agents) work with several different insurance companies. As such, brokers tend to give you a more well-rounded view of your options. However, they might charge you a broker fee.
Additionally, agents might be more knowledgeable about the companies they work with, including discounts provided by those companies!
Research Car Insurance Companies
Whether you use an agent or broker or go it alone, it’s crucial to research car insurance companies before applying for quotes and choosing a provider.
Ways to dig a little deeper into companies include:
- Check with your state’s Department of Insurance for consumer complaint ratios.
- Learn about the provider’s financial standing.
- Reputable companies that can help you do this include J.D. Power and A.M. Best.
- Look up the company’s rating on the Better Business Bureau (BBB).
- The BBB rates businesses from A+ to F and provides a wealth of specific information including customer complaints and how long the provider has been in operation.
- Find the provider’s social media accounts (such as Facebook and Twitter).
- Reach out and ask specific questions about coverage options and cost. Gauge responses and determine the quality of customer service.
- Talk with family members and friends about their auto coverage providers.
- What kinds of experiences have they had? Are they pleased? Why or why not?
Getting Car Insurance Quotes
Now that you have a handle on a few possible companies, it’s time to apply for car insurance quotes.
In addition to some of the tips and discount information listed below, it’s important to never limit yourself to one company. Always get at least three quotes from three different providers. This is easy to do in today’s market, as you can get multiple quotes online at one time.
You will need to have some information on hand, such as:
- Your Social Security number.
- Your VIN number.
- Your car’s make and model.
- Your daily mileage.
Giving yourself as many options as possible opens the door to better coverage, more affordable rates, and a multitude of discounts.
Tips to Find Cheap Car Insurance
You know that getting as many quotes as possible is one way to find more affordable coverage. Now try some of these tips for first time drivers on getting discounts and the best car insurance rates:
- Ask about multi-line coverage.
- Also known as “bundling,” insuring multiple properties (such as vehicles and houses) can get you a discount on both lines of insurance.
- Look for good-driver rewards programs.
- Some companies provide drivers with discounts after a certain period of accident- and violation-free time.
- Complete driver’s education or driving training courses.
- Even if they’re not required in your state, some insurance providers offer discounts for successfully completing these driver-training classes.
- Keep a clean driving record.
- Car insurance companies are notorious for hiking up rates if you have a history of license suspensions, traffic violations, and at-fault accidents.
- Learn about discounts for teen drivers.
- Teen drivers are among some of the most expensive to insure, but many companies provide discounts to those who’ve completed Driver’s Ed or bring home good grades each semester.
- Choose a safe vehicle for your first car. Safety features get you discounts and keep you protected!
Understand, this isn’t an exhaustive list. You can—and should—always ask each car insurance provider about discounts for which you might be eligible.
Learning to drive is an expensive business. Booking lessons with a driving school or instructor costs a pretty penny, and if you're being taught by a family member, learner driver car insurance can be nearly as expensive as having professional lessons. And once you've passed your test, the expense simply continues.
If you're a first-time driver but are a named driver on somebody else's policy, that'll be pretty expensive, and you'll face the same expense if you buy your own car - it's likely that the cost of your first car could be far outstripped by the insurance. And that's before you've even factored in the usual running costs associated with owning a car. Add it all together, and the expense could put you off driving for life!
However, there are ways of cutting insurance costs for new drivers. A quick search online reveals that some insurance companies offer schemes that are designed with young drivers in mind, and in general the require policyholders to have their every move tracked by a little black box and satellite GPS. Such schemes can save worthwhile amounts of cash, but not usually enough to take the sting out of getting covered. The truth is that any form of young driver insurance has the potential to be prohibitively expensive, which is one reason why youngsters aren't as keen as they used to be to get behind the wheel.
• Best first cars for young drivers
But are sky-high insurance costs for new drivers fair? Well the insurance industry thinks so, with figures showing that one in five UK drivers will have an accident in their first year on the road, while 25 per cent of all accidents involve at least one driver under the age of 24. But while the safety statistics prove that girls are safer new drivers than boys, EU regulations outlaw the provision of cheaper premiums based on gender.
Whoever you are, you need to be armed with as much knowledge as possible to ensure your first insurance policy offers the best value possible. And the following guide gives a rundown of the best young driver car insurance options available...
Manufacturer-backed young driver insurance deals
Car makers need sales, and getting a new driver behind the wheel is one way of doing it. But the high cost of insurance, let alone the cost of buying a brand-new car, is going to put most new drivers off going to their local dealer, unless they have the bank of mum and dad to help cover the costs.
If that's the case, there are plenty of tempting finance deals that offer affordable ways to drive off in a new car, and the manufacturer will sometimes help to insure young drivers, too.
Ford offers a contribution of up to £500 off Marmalade insurance if you buy a new Fiesta, for example, as long as you fit it with a black box (explained below). You must be between 17-24, and the offer is subject to all the usual eligibility criteria.
Where should I look for cheaper car insurance?
The quickest and easiest way to find the cheapest car insurance quote is to go online to one of the various comparison websites.
Simply key in a few details about yourself and your car, and you’ll bring up a long list of options to choose from. Remember that this will not be an exhaustive list, and quite often going to a broker or directly to the major insurers that aren't signed up to the comparison websites can get you a better deal.
There are a few pitfalls to be aware of when using comparison websites, too. First, be careful to check the details. For example, to reduce the premium in order to rank higher on the sites, insurance companies will often include a higher compulsory excess, which may not suit your needs.
Consider ringing up the insurer directly, too. They’ll sometimes be able to beat the online quote, as they won’t have to pay the fee that the comparison site charges. Don’t assume fully comprehensive cover will be more expensive than third party, either. Sometimes the fully-comp deals come out less expensive, because insurers believer that somebody who is willing to pay for comprehensive cover is going to be a more thoughtful and conscientious driver.
What is black box car insurance?
Telematics or 'black box' car insurance is an emerging market that continues to offer young drivers a way to get cheaper premiums.
The technology – in the form of a black box - is fitted to your car. This then gathers driving data, such as your speed, distance travelled and at what time of day, and this is then fed back to the insurer to generate a more accurate premium for individual drivers. If you keep a good record, then your premium will be adjusted accordingly, and you will earn rewards in the form discount vouchers for shopping and eating out, for example.
If you’re a safe driver you’ll also be rewarded with bonus miles or may get a discount at renewal time. Choosing a policy with telematics as part of the deal will almost certainly reduce your premium as a young driver, so it's well worth considering.
Can my parents help to lower my car insurance quote?
When filling in your insurance details, there’s no benefit to bending the truth. If you insure a vehicle in your parents' name, with you as a named driver, rather than putting yourself down as the main driver, it might not be in your best interests. Not only is it illegal, but in the event of an accident it would invalidate your cover altogether. However, there are some simple ways that parental help can get you a cheaper annual insurance premium.
• History of the UK driving test
Consider doing the opposite, and add a parent as a named driver on your insurance policy, even if they only drive the car occasionally. You must list yourself as the owner and lead policyholder but there’s nothing wrong with using an additional experienced driver to help cut costs.
Similarly, if your parents have insurance cover on their own cars, consider getting a multi-car policy. Larger insurers will offer a discount for insuring a fleet of family cars, and as a result your individual insurance quote will be less.
Car insurance is affected heavily by location as well. Clearly we’re not suggesting you move house to get a cheaper insurance deal, but getting your car off the road and onto a driveway or into a garage will help lower your risk and subsequently reduce your premium. Fitting an alarm or immobiliser to your car will help, too.
What’s the best car to buy to get cheaper car insurance?
Young drivers who’ve just passed their test all want a flash car to show off to their mates, but as a general rule, the flashier the car, the more the insurance. There’s obviously the purchase price to think about, but even if you can find the funds to buy that dream car or you’ve been given the cash as a present – you might not be able to insure it.
• Cheapest cars to insure
Nearly half your premium is dependent on what type of car you’re driving, so as a young driver starting off on the road you want a car that’s in one of the lowest insurance groups. A car will often fall into a lower insurance group if it’s got a cheaper list price and smaller engine.
Another way to avoid paying over the odds is to avoid modifications. Adding a spoiler or a bodykit may look good to boy racers, but insurers may take it as a cue to charge you more. Check out our top 10 list of the cheapest cars to insure to help you with your decision.
Do I have to pay for my car insurance up front?
Paying a lump sum up front for a whole year's worth of car insurance can be daunting, and for young drivers it will often be more than the value of their car, but it’s often cheaper than paying by a monthly Direct Debit.
Many insurers will offer monthly repayment plans or split the cost into two six-monthly payments, but the reality is you’ll end up paying more in the long run. Some insurers add up to 10 per cent onto the quoted premium if you pay monthly, while others charge interest on a monthly direct debit. If you can find the cash upfront, it’s the most cost effective way to pay.
Car insurance jargon explained
Inevitably, there's a lot of jargon attached to the car insurance market but our handy guide will explain some of the key terms...
This is the amount you’ll have to pay if you make a claim before the insurance company will pay out. If you have a claim for £1,000 and your excess is £400, you’ll pay the first £400 with the insurer picking up the tab for the rest. Compulsory excess is what the insurer sets while voluntary excess is decided by you. Setting a higher excess will reduce your annual premium.
These policies offer the most complete level of car insurance protection available. With comprehensive car insurance, you can claim from your insurer for accidents that are your fault or when fault can’t be proven such as in a car park.
It’s the minimum amount of protection you can buy. It covers you against damage to another vehicle or structure, injuries to a third party or your own passengers and medical treatment cost and legal cost claims against you. Third party, fire and theft cover adds protection against someone trying to steal your car or set fire to it.
Tell us your experiences or trying to get car insurance as a young driver in the comments section below...
First Cars on Auto Express...
Everything you need to know about learning to drive, getting your driving licence and choosing your first car...
Learning to drive
- How to get your driving licence
- What is the highway code?
- Best intensive driving courses
Passing your driving test
- Driving theory test: everything you need to know
- Hazard perception test: what to expect and how to pass
- Driving test 'show me, tell me' quesions: hints and tips
- Practical driving test: how to pass
- Driving test pass rates explained
- Driving test aids product test
- History of the UK driving test
Getting your first car
- Best first cars for young drivers
- Cheapest cars to insure
- Cheaper car insurance for young drivers: our top tips
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Starting to drive is an exciting moment for teens, but for their parents, it can be stressful and it will certainly be expensive. The good news is that you can check quotes from different insurance companies and minimize the damage to your wallet. Let us guide you through buying car insurance for young drivers to help you save money.
Find out about…
• Insurance for College Students
Before your teen starts driving, you should know:
- All drivers in a household need to be added to a car insurance policy. There is no easy or cheap way to get around car insurance for a new driver. Either you need to add your teen to your policy, or the teen needs his own policy.
- Sharing a joint policy with a teen is cheaper than paying for separate policies. Additionally, there is no benefit to a teen getting his own policy. This doesn't mean, however, that you should simply add your teen to your current policy and be done with it. Adding a new driver means your company generates your rates all over again, and a different company may give you a better deal. Shop around by getting quotes from several companies.
Do I have to add my teen once he has a learner’s permit?
The process of insuring a new driver typically starts when the teen gets a learner's permit. Once teens get a learner's permit (aka provisional license or instruction permit in some states), some companies allow you to add them to your policy at no additional charge until they get their licenses or turn 18. They allow this because state permit-holder laws require a licensed driver age 21 or older in the passenger seat, making the young driver less of a risk. Other auto insurance providers require that teens be added when they are in the permit stage, so check with your provider.
Do I have to add my teen to my policy if he doesn’t own a car?
Yes. It doesn’t matter that he doesn’t have his own car; he has access to yours. If you don’t add him to your policy and he is in an accident, your policy may not cover him. Some car insurance companies explicitly note in their policies that unless you notify them of additional drivers or risks, those individuals will not be covered. If they do cover the accident, the insurer may require you to pay back premiums from the time the teen was licensed.
If your teen is getting a license but isn’t going to drive your cars -- ever -- then in some states, some insurers will let you exclude the teen from your policy. If you do exclude a teen, or anyone, from your policy, there will be no car insurance coverage extended if they are in an accident. Many insurance companies want you to tell them about household residents who are over a certain age (usually 15) whether that person is licensed or not.
Do I have to tell my insurance company about my teen if he isn’t licensed?
Yes, you usually do. When you renew your policy, you are usually asked for information on everyone in your household. If your child hasn’t received a permit or license yet, the teen usually can be listed as unlicensed on your policy. When a young driver is noted as unlicensed, he also should be unrated by the car insurance company, meaning the teen wouldn't affect your rates.
Who should insure a teen if the parents are divorced?
In general, the custodial parent’s policy is primary for the newly licensed driver. However, if the child will drive when staying at the second home, both parents typically need to list the teen as a driver. Car insurance companies deal with this situation differently, so check with your company and ask what your new rates will be. This way you’ll know what to shoot for if you decide to shop around for a better deal.
How can a teen get his own policy?
A teen driver can get a car insurance policy of his own, but if he’s under 18, a parent or guardian signature is required on the policy since insurance is a legal contract. Even if you are willing to sign on the policy with a young driver, keep in mind that it’s cheaper if the teen is added to your policy instead. Read our age-specific guides for teen drivers to see how rates differ depending on whether the teen is on his own policy or the parent;s:
How much does car insurance for new drivers cost?
Our analysis of the cost of adding a teen driver showed an average increase of 160% when a married couple added a teenage boy to their car insurance policy. This number can only be used to give you a very general sense of how much your rates will increase. Every situation is different, and rates depend on your insurance provider, coverage options, ZIP code, vehicles, driving records, how much you drive and many more factors.
Why is car insurance for young drivers so expensive?
Teens are inexperienced behind the wheel and immature by nature. That's a bad combination. A brand-new driver is 12 times more likely to have an accident than someone with a year of experience, says the National Institutes of Health. A 16-year-old who’s had one accident is 50 percent more likely to have another, says the National Highway Transportation Safety Administration. In addition, maturity levels change quickly. Teens who get their licenses at age 18 have fewer fatal accidents than those who are licensed at age 16. Many insurers no longer lump all young drivers together but instead rate age groups separately.
At what age do young drivers' rates go down?
The age of 25 is typically when insurance companies begin to offer the same rates they do to all other adults. Some carriers will lower rates for women when they turn 21 and men when they turn 24. Once you’re no longer priced as a “young driver,” your insurance provider will rate you based on your driving record rather than those for young drivers in general. In addition to rating drivers based on age, insurers can also levy a surcharge for inexperience, usually for those who have been licensed less than a year. To get a better sense of how insurance rates change by age, see average insurance rates by age.
Good student discount
Encourage your kid to do well in school because student car insurance discounts can help bring down your rates. Each insurer has its own guidelines, but typically the discount can be 10 percent to 15 percent. Each insurer always has its own rule for what constitutes a “good student” – either a 3.0 grade point average or above, placement on dean’s list or honor roll, or ranking in the top 20 percent of the class.
Safe driver discount
Look into discounts for new drivers who take a safe-driver course, sometimes sponsored by the insurance company. This may mean attending an actual classroom driver’s education class, watching a driving video, or passing a written driving safety test. Your company may also offer discounts if the teen drives with devices that monitor driver behavior.
Cars for Teen Drivers
Given the cost of car insurance for your teen, you may want him driving a car this is cheap to buy and cheap to insure. Check out our list of the 20 best used cars for teens.
The least expensive cars to buy aren’t always the least expensive to insure. Some cars cost more to repair after an accident, and some have a record of more injury claims than others do. And the least expensive car to insure may not be the safest. Electronic equipment such as stability control and antilock brakes can help novice drivers avoid accidents, and there can be a discount for having them. The lowest car insurance rates are often given to drivers with minivans and small SUVs.
Insurance for College Students
When a teen moves out to go to college, you’ve got another car insurance decision to make, based on whether the teen owns a car, how far he moves, if he’s going to drive a family car while in town, etc. Read our guide to car insurance for college students to get guidance for your unique case.