The cost of car insurance for under-25s has fallen but it's still eye-wateringly high, and the average premium for a 17-22 year-old is £1,242/yr. However, you can cut costs.
This is a step-by-step guide to young drivers' car insurance, helping you compare more than 100 providers in minutes, with specialised tricks, and dos and don’ts to save every spare penny.
If you're aged over 25 check our main Car Insurance guide for more.
In this guide
12 ways to cut young driver costs
Did you know the average driver faces an annual insurance premium of £549, with drivers under the age of 25 paying more than £1,200 for their cover? Here are our top car insurance cost-cutting tips for young drivers that can save you £100s.
There are three different types of car insurance: third party only, third party fire and theft, and fully comprehensive.
Logically, third party insurance should be cheapest for young drivers as it offers a lesser level of cover than fully comp, yet this isn't always the case.
The rationale is that insurers think people who choose third-party insurance are more of a risk. In one low-risk young driver quote, we found an annual £1,500 saving for having comprehensive cover over a third-party only policy.
Adding a second driver to the insurance, even if they won't use the car often, can smooth out the average risk and sometimes cut the price. Those with a good driving record are likely to help make bigger savings, but anyone that's in a lower risk category than you can help.
We tried adding a 40-year-old family member as an 'occasional' user (not a main driver) to an 18-year-old's policy which reduced the premium by approximately £1,000. It won't always work, but it's worth playing with quotes to check.
Beware - At no point should you add your name as the main driver on someone else's car, such as one of your children, instead of them. This is known in the industry as 'fronting' and is fraud. When you come to claim, this will be checked out and your insurance will be invalidated. It can lead to prosecution, so don't do it.
Ensure you always minimise your risk
Whether or not you're a young driver, insurance premiums (the payments made to insurance companies) depend on three things:
Car insurance rates are set by actuaries, whose job is to calculate risk. You can make big savings by showing an insurer you're not the typical high-risk young driver.
Each insurer's price depends on two things: the underwriters' assessment of your particular situation, and the pricing model that dictates the type of customers the insurer wants to attract.
Do I need a security device?
Any extra security will help. Fitting an alarm or immobiliser (especially one approved by Thatcham) can reduce the bill.
Does it matter where I park my car?
Theft and accidental damage add a wedge to insurance costs. If you leave your car in a garage or driveway, it's a big deterrent to theft and means accidental damage is less likely.
If you have points on your licence, the cost will be higher. While speeding points remain on your licence for four years, insurers usually check for convictions during the last five.
One speeding conviction can affect the price of cover by over 30% and a CU30 (using a vehicle with defective tyres) by more than 60%.
Being caught using a mobile phone is also a serious issue, it can double your quote and also give you three points on your licence, which stay on for four years. Approved hands-free kits are fine if used properly.
Should I try and reduce my mileage?
The less you drive, the cheaper your insurance can be. Where possible, try to reduce your mileage. This may sound trite, but actually the real key is incorporating the extra insurance cost when you make long journeys, not just the cost of petrol compared to taking the bus or train (also read the Cheap Trains guide).
Anecdotally, though many simply get a quote for 10,000 miles per year, MoneySavers have reported that 5,000 is the best figure to use - though we haven't tested this. If you drive your vehicle on business, always declare this rather than just including the business miles as personal, or the policy may be void.
Can extra driving courses help?
PassPlus: This Driving Standards Agency course is aimed at helping new drivers (who have passed their test within 12 months) become more confident on the road. There are six modules: town driving, all-weather driving, driving on rural roads, night driving, driving on dual carriageways and driving on motorways.
The course costs about £170 but this varies depending on where you live and the instructor or driving school you choose. Some local councils in England and Scotland offer discounts of up to 40%, which are usually for under-25s, while in Wales it only costs £20. See Gov.uk for more details.
Once you have the certificate some, although not many, insurers discount the price of your cover. Sadly it's become less and less recognised in the last few years, so the discounts aren't generally that high. There's a good chance you could get cheaper cover elsewhere.
Drive iQ: This course is provided by the AA and some independent driving schools - it's included within the cost of your lessons. It combines online learning with practical lessons for learner drivers.
It covers attitudes and behaviour to driving, rather than just car control skills, and is based around five units which also include motorway and night driving. It says once you’ve passed, you’re eligible for exclusive insurance deals. But check quotes with Drive iQ before you sign up, to see how it compares.
How can I avoid 'ghost brokers'?
If you get a quote that’s too good to be true, or you’ve never heard of the company trying to flog you cover, double-check it’s not a 'ghost broker' selling you worthless insurance. Ghost brokers are fraudsters who pretend to sell you insurance, but pocket your cash instead.
Tell your insurer about special circumstances
If you haven't got 'normal' circumstances, eg, you've made a claim in the past few years, have a modified car or expect to drive 100,000s of miles a year, tell your insurer. If you don't and then try to claim, even for an unrelated issue, your policy may be invalid.
You also need to tell your insurer about any changes as this reduces potential problems in the event of a claim, even if it's just your address. Trying to get insurance after you've had a policy cancelled is very difficult, very expensive and will follow you for the rest of your life.
A change in circumstances includes moving jobs, as insurers believe this can affect your risk. Scandalously, the unemployed often (though not always) pay higher rates for their car insurance - so tell your provider if you're out of work.
Sexy it might be, MoneySaving it ain't. The more changes you make to your car, barring security ones, the more you'll be charged.
Always make sure you inform your insurer of any modifications to your car, whether you made them or not, or it may invalidate your policy.
What counts as a modification?
A modification is anything that isn't part of the standard vehicle specification, including factory-fitted optional extras such as alloy wheels.
Does the car type affects the insurance cost?
The combination of popularity, engine size and value all have an impact on car insurance cost. It's worth considering this when you buy; insuring a super-powerful beast of an SUV for a 17-year-old would cost enough to make Bill Gates weep.
Set the right excess without breaking the bank
It's worth thinking about going for a policy with a higher excess - the amount of any claim you need to pay yourself. A higher excess will result in lower premiums but make sure you can afford the premium in the event you need to claim.
Many people find that claiming for less than £500 of damage both increases the future cost of insurance and can invalidate no-claims bonuses, meaning it's not always worth making a claim.
So why pay extra for a lower excess? A few insurers will substantially reduce premiums for a £1,000 excess, so try this when getting quotes. The downside of this is if you have a bigger claim you'll have to shell out more, so take this into account.
How can I protect my excess?
If the thought of a high excess worries you, an excess protection policy is available – this allows you to claim the excess sum back. But make sure the insurer’s discount exceeds the cost of this excess policy to make it worthwhile.
It is also worth noting that with this policy, you are not covered within the first 30 days of taking out the contract. You’ll still need to pay the excess, and wait for reimbursement.
With insurance, remember - the golden rule is:
Tell them the truth, the whole truth and nothing but the truth.
If you've read these tips and thought, "it's easy to lie about this", then of course, you're right. Yet lying on your insurance form is fraud. It can lead to your insurance being invalidated and, in the worst case, a criminal prosecution for driving without insurance.
Another quick win is tweaking your job description. To help, we've built a fun Car Insurance Job Picker tool to show the riskiest jobs and see if small changes to your job description could save you cash. Remember, never lie as this will be considered fraudulent. If it worked for you, share your success stories with our forum users.
Thank you @MartinSLewis after rewording my job occupation on car insurance I have managed to save £400. @JenStaCreations
I did this too thanks to @MartinSLewis from creative director to marketing manager = saved £300+ Crazy world isn't it? @fabsternation
What if I am unemployed?
If you don't have a job, you face a potential fivefold jump in insurance costs by declaring you're unemployed. The same hikes don't apply to homemakers (house wives/house husbands). If that's you, say so to avoid a hike in costs.
However, only enter homemaker if you're genuinely not seeking work or receiving benefits which require you to seek work. Otherwise, it's fraud. Read the full MSE News story: Unemployed walloped with high insurance.
Nothing better illustrates car insurers preying on loyal customers than Sarah Cooper's tweet. "My car insurance renewal is £1,200. New policy with same company is £690. How do they justify this?" They don't. They just do it.
Insurers charge increasing amounts each year, knowing inertia will stop policyholders switching. If your renewal is coming up, jot it in your diary to remember it. Compare comparison sites and then call your insurer to see if they can match, or even beat, the best quote you found. If they can, you're quids in.
If you've two or more vehicles between friends or family members in your household (vans can be included in this but bikes usually aren't), some providers offer discounts if you insure them together. Comparison sites don't have the technology to do these searches, so you need to compare manually.
Use comparisons for each car separately. The discounts are usually around 10%, so often it's likely just finding the cheapest standalone insurer will win anyway. So always do a comparison first (see Combine comparison sites below), then try the deals below to compare.
Get all cars on one policy. Admiral* gives a discount of up to 25% for up to five cars. All cars will be covered on one policy, so the renewal dates will be aligned.
Separate policies with a discount. Other insurers allow cars to have separate policies but give a discount as long as the vehicles are in the same household.
Additional providers who also give a multi-vehicle discount are Aviva*, Churchill*, Direct Line* and Privilege*. Discounts vary and depend on your circumstances but all the above are worth adding to your list to try.
Telematics is a policy which prices your premiums depending on how you drive. A device - known as a black box - installed in your car monitors your actions behind the wheel so the better your driving, the less you pay for cover.
If you are confident that you can drive well you can earn £100s back on the your cover via a telematics policy. Be warned however, that driving badly could also see your premiums increase.
Providing you drive well and don't have any accidents, your insurance premium should get cheaper after the first year. However, don't automatically stick with the same provider.
Apply for cover from your existing insurer as a new customer and it's likely you'll be given a cheaper price.
Will my insurer remind me when it's time to renew?
Insurers usually send out notifications at least 21 days before renewal. This doesn't leave much time, and you can end up rushing to find a cheaper price.
To avoid being forced to decide quickly, put a warning in your diary six weeks before your renewal date, so there's plenty of time to sort out a new provider. Alternatively, use the free Tart Alert which sends a reminder text or email.
Step 1: The top comparison sites
Comparison sites zip your details to hosts of insurers' and brokers' websites, scraping their data off the screens to report back the cheapest. So be aware they often feed your personal details to insurers.
They don't all compare the same companies, so the best strategy's to combine them. We've analysed the comparison sites, using a large range of monthly data, focused mainly on which ones produce the cheapest results. For drivers aged 25+, see our Cheap Insurance Guide.
On top of the price data, we've conducted separate research to see if quotes from comparisons match up to the prices on insurers' own websites, how consumer-friendly the quote process is, and the speed at which the comparison delivers results. See How the order is picked for more information on how we rated these 'soft features'.
Our comparison site order in full technicolour detail
No single site captures the entire market, so combining a number of sites is the best way to make a really meaningful saving. If you missed our explanation of how we pick our comparison sites, please see the top comparison sites section above.
- Price for add-ons clearly displayed? Yes
- Received marketing calls when we asked for none? No
- Prices match insurer's site more than 80% of the time
- Excesses match what was asked for? No
- Tick-box for marketing calls? Opt-out
- Prices match insurer's site more than 80% of the time
- Price for add-ons clearly displayed? Yes
- Excesses match what was asked for? No
- Marketing calls: You have to opt out of calls
- Received marketing calls when we asked for none? Yes
- Received marketing calls when we asked for none? No
- Prices match insurer's site more than 90% of the time
- Price for add-ons clearly displayed? No
- Excesses match what was asked for? No
- Marketing calls: You have to opt out of calls
Always double check the price
Click through to the insurance provider's own website to double-check the quotes, as to speed up searches some comparison sites make a few assumptions (see what to check).
Examine the policy's coverage
Check whether it's suitable . If you want "free car hire" while your car is being fixed, is it included?
Plus while you're there, it's worth playing with the policy details to see if you can finesse the price down. Look at the excess, and whether adding drivers cuts the cost.
Step 2: Check the insurers not on comparison sites
Three of the biggest insurers on the market, Direct Line, Aviva and Zurich, only offer their products directly and aren't on comparison sites. Benchmark your cheapest aggregator quotes against the premiums offered by these sites to see if you can slash costs further.
Direct Line*. Get 10% off for every additional vehicle you add to your policy or if you have any other Direct Line product, get 10% off with Direct Line Together.
Aviva*. Grab up to 20% off online and an extra discount of up to a third by adding a second car or van to your policy.
Zurich. Get a courtesy car following an accident on standard policies, if you use one of its approved repairers.
If you can't get cashback it's worth noting a few companies have special deals not mentioned by comparison services. These include:
Use this Co-operative insurance* link to buy a new car insurance policy by 31 Aug and receive a Karcher K2 compact pressure washer worth £79.99.
You'll be sent a letter or email 14 days after you've bought the policy with details about how to get the washer. You'll then have 30 days to redeem it, online or by phone, and it will be sent within 90 days of the policy start date (see T&Cs for more).
Free RAC cover
Insurance broker Be Wiser offers free RAC membership for policies bought via its website.
Free Green Flag breakdown cover*
New customers who buy a Sainsbury's* motor policy by 28 Sep will get Green Flag breakdown cover free for a year. Nectar cardholders will also get up to a third off their car insurance and double Nectar points for two years on shopping and fuel.
What happens if my insurer goes bust?
Insurance providers regulated in the UK are covered by the same Government-backed Financial Services Compensation Scheme (FSCS) as banks, so if they go into default, you're protected.
A number of insurers - particularly those who offer telematics pay-when-you-drive cover - are based in Gibraltar. However, a special FCA rule says these policies have the same protection as those from UK-based insurers. Specifically: "The UK requires all EEA (European) insurers... to participate in the FSCS in the same way as all insurers that are directly authorised by the FCA."
In the unlikely event a regulated insurer goes bust, the FSCS will try to find another provider to take over or issue a substitute policy. However, if you've ongoing claims, or need to claim before a new insurer is found, the FSCS should ensure you're covered. For more see the insurance section of the Savings Safety guide.
Step 4: Try specialist policies
Once you’ve tried the comparison sites, it's time to check specialist young driver policies to see if they undercut them. If you are a careful driver who doesn’t cover many miles and drives during off-peak hours, you could see a reduction in the premium.
Despite some confusion, Telematics is not an 1980s games show hosted by Noel Edmonds (that was Telly Addicts!). Telematics is a type of motor insurance policy which prices your premiums depending on how you drive.
A device inside your car monitors your actions behind the wheel. So the better you’re driving, the less you pay.
Remember, telematics policies have more aliases than a rap group. If you're looking at "black box", "smart box", "pay-as-you-drive" or "usage-based" insurance then you're looking at a telematics policy.
The black box feeds data back to your insurer, which takes this into account to reward you, with money back on your premiums, if you can prove you're more Driving Miss Daisy and less Fast & Furious.
How much is a black box?
Once you’ve sign up for a policy, you’ll need to arrange a date for a black box to be fitted to your car. You don’t typically have to pay an upfront cost for the box but the price of it will be incorporated within the premium. Some insurers will impose a fee if you miss a fitting appointment, need to move the box to another car or want it removed.
And if you start tampering with it - thinking you can move it or trick it, and it breaks, expect a hefty bill for a replacement box.
How do they judge you?
It’s not just a case of keeping your hands at ten and two and shifting smoothly up the gears. Insurers will take the following into account.
- The time of day or night you drive (11pm to 5am may cost more)
- Your speed (stick to the limit)
- Gentle braking reactions (hard and sharp stopping is not good)
- Gentle acceleration and cornering is good (don't treat your local roads like Silverstone)
Telematics providers will charge you more if you speed or start cornering like Lewis Hamilton. In addition, you won't earn any rewards if you don't drive responsibly. With insurance so expensive, any money back on your cover should be an incentive in itself.
While your insurer will be following your driving closely, there are relatively few restrictions on when and where you drive.
Some insurers, such as iKube and Co-op*, have curfews in place meaning driving at certain times (usually between 11pm and 5am but up to 6am with the Co-op) could result in a fine or an increase in premiums.
Several providers offer telematic products. Here we've listed a selection of the best around.
Direct Line Drive Plus. Direct Line Drive Plus* gives a 25% discount upfront which can be lost if you don't drive appropriately.
Coverbox. A 'pay as you drive' scheme from Coverbox* which allows you to choose from as low as 3,000 miles and is available for a wide range of ages. with no curfews.
So if you're a low mileage driver this can cut costs. You also get the option to buy more miles if you underestimate your annual mileage.
iKube. Alternatively, iKube is aimed at 17-25 year olds who don't often drive between 11pm and 5am. There's an extra fee for driving between these times, making the cost prohibitive if you do so.
Drive Like A Girl. Another policy aimed at 17-25 year-olds who avoid driving overnight (this time between 11pm and 4am) is Drive Like A Girl*. It's not just for girls, it's open to boys too - but show you can "drive like a girl" and you could get money back. It's also open to all ages.
Insure The Box. With Insure The Box*, you can pick either a 6,000, 8,000 or 10,000 mile-per-year policy for your premium, and then you can earn extra miles by driving safely - or buy more online if you need to during the year.
Here, GPS or tracking devices monitor how you drive. Of course, even then, the price still depends on your personal risk profile.
Co-op. The Co-op's* young driver insurance fits a box into 17-24-year-olds' cars to monitor acceleration, braking, cornering and time of driving. You can pay upfront for the year or by direct debit.
The price of the insurance can vary, depending on how well the car’s been driven. Severely bad driving could see your insurance cancelled.
While comparison sites are very good for people with normal situations, for others they can under perform. Swinton's Young Driver insurance is worth checking out, as it searches a panel of young driver and student car insurance providers.
Other brokers providing for young drivers include A Plan, Thames City, Only Young Drivers, Adrian Flux and Endsleigh (best to call for quotes, as not all offer these online).
Or try speaking one-on-one to a local insurance broker about your individual circumstances to see if they can find you a decent policy (search on the British Insurance Brokers' Association website).
Learner driver insurance
If you're a learner, it often means being added to parents' or friends' car insurance as an additional driver which can up the cost, and put no claims bonuses at risk.
However, it is possible to get specific policies just for the provisional driver which protect this, for example via Marmalade's Learner Driver* insurance.
Provisional Marmalade also has a reward scheme to get a £100 discount if you move to Marmalade's New Driver* insurance when you’ve passed.
With Marmalade's New Driver* insurance you get the insurance policy alongside low-risk new or nearly new cars on a two to five-year hire purchase or personal contract plan.
This can bring the insurance cost down dramatically, but obviously, you're buying a car at the same time. Do the numbers very carefully before signing up, though it can work out cheaper in the long run for some.
Marmalade's New Driver* car policies also include telematics devices. The cost savings for good drivers are built into your starting price, so it can be increased if your driving is poor.
Step 5: Cashback, discounts & haggling
By now you'll know the cheapest provider, yet you may be able to cut the cost even further. The list below takes you through a variety of options to improve your deal.
These sites carry paid links from some retailers and financial services providers; in other words, if you click through them and get a product, they get paid. They then give you some of this cash which means you get the same product, but a cut of its revenue.
Don't choose based only on cashback, see it as a bonus once you've picked the right cover.
Those new to cashback sites should ensure they read the Top Cashback Sites guide for pros and cons before using them. Otherwise use the Cashback Sites Maximiser tool to find the highest payer for each insurer.
Things you need to know before doing this...
- Never count the cash as yours until it's in your bank account. This cashback is never 100% guaranteed, there can be issues with tracking and allocating the payment, plus many cashback sites are small companies with limited backing, and you've no protection if anything happens to them.
- Withdraw the cashback as soon as you're allowed. Money held in your cashback site account has no protection at all if that company goes bust, so always withdraw it as soon as you're eligible.
- Clear your cookies. While it shouldn't be a problem, if you've used comparison sites beforehand, there is a minor risk that the cashback may not track due to cookies - so it's good practice to clear those first (read About Cookies).
Haggle on your car insurance
The car insurance market is very competitive and companies are desperate to retain business - but never just auto-renew.
Insurers love auto-renewing, as it's a fine for apathy where they hoick the premium knowing you'll pay. If a policy has automatically renewed, getting out of it usually means charges and fees, so don't get caught out.
Once you've got your overall cheapest price, get on the phone and try to haggle as your renewal is a starting point. There's often massive price flexibility, but be fully armed with the screenscrapers' cheapest quotes and any available cashback first.
The first port of call should be your existing insurer. If it can beat or even match the best quote it saves the hassle of switching policy. If that doesn't work and you're still in the mood, take it to a broker. For more haggling tips, read the full Haggle On The High Street guide and The top 10 firms to haggle with.
Have you used this guide's techniques to save on your car insurance? If so, please feed back on the price you found in the Young Drivers' Insurance Savings forum discussion.
How to complain about your insurance provider
The insurance industry doesn't have the best customer service reputation and while a provider may be good for some, it can be hell for others. Common problems include claims either not being paid out on time or at all, unfair charges, or exclusions being hidden in the small print. It’s always worth trying to call your provider first, but if not then…
Free tool if you’re having a problem
This tool helps you draft your complaint and manage it too. It’s totally free, and offered by a firm called Resolver which we like so much we work with it to help people get complaints justice.
If the complaint isn't resolved, Resolver will automatically escalate it to the free Financial Ombudsman Service.
Important: if your issue is about a voucher or incentive that was part of an MSE Blagged deal, then instead just let us know by emailing firstname.lastname@example.org as that’s usually quicker.
Young drivers' car insurance Q&A
Why is car insurance so expensive for young drivers?
Unfortunately there are several reasons for this. Young drivers are less experienced than older road users, bringing them into a higher risk category with insurers. Less experienced drivers are more likely to have more accidents, and therefore put in more claims to their insurers - so insurance companies make their premiums more expensive to compensate.
Yet by driving carefully you can help offset this and lower your premium - see above for more.
Should I take a monthly payment plan?
Beware 'pay monthly' options - usually the insurer just loans you the annual cost and then charges interest on top at hideous rates. As the average cost for a 17-22 year old is £1,242, paying by installments can easily add another £200 to your premium.
So either pay in full, or if you can't afford it, try to borrow the money elsewhere more cheaply (ideally on a 0% credit card for spending, ensuring your repayments are big enough to clear it within a year).
If paying by credit card, check if the insurer or provider charge a fee for doing so - though the fee is usually less the monthly installments interest charge.
I'm not driving my car for a bit, does it need to be insured?
Yes - cars must be insured unless declared off-road. The Continuous Insurance Enforcement scheme means all cars must be insured - even if no one drives them. The aim's to crack down on two million uninsured drivers by matching up the database of cars and insured drivers.
The only way out is to apply for a SORN (Statutory Off Road Notification) declaring your car will never be driven. Ensure you search for the new cheapest in advance of renewal, or you'll end up just auto-renewing to stop the fine.
Am I covered to drive others' cars on my insurance?
If your insurance allows it, driving someone else's car instead of yours can be a way to cut mileage. Check your policy details carefully to find out if you can.
If you have fully comprehensive insurance then often, although not always, it includes what’s called "driving other cars" cover. This provides you with third party cover whilst reducing your mileage and therefore the cost of your own policy.
Would it be cheaper for me to just get a motorbike instead?
Generally, insurance is a lot cheaper for a moped or motorbike than for a car. Plus, some insurers may put any no claims bonus from bike insurance on your car insurance too if you later get your car insured with them. Yet do take safety into account as a new driver - if you're in an accident, you're better-protected if you're in a car. See the Bike Insurance guide for more.
What's the difference between a screenscraper and a broker?
Brokers and screenscrapers may seem like they're doing a similar job, as each search a number of different insurers; yet they're radically different beasts. A good analogy for this is to compare it to searching for the cheapest loaf of bread.
Individual insurers are like bakers, your choice is simply to buy its cheapest loaf that suits.
Brokers are like supermarkets; they stock a range of bakers' loaves and the price charged depends on their relationships with suppliers.
Screenscrapers are different: it's like sending someone round supermarkets and bakers to note all their prices.
Are there any ways to get to a no-claims bonus faster?
Some schemes do offer an accelerated no-claims bonus - giving you a year's no-claims bonus after 10 months - such as Admiral's* Bonus Accelerator.
MSE's forumites have also suggested another tip. If you've previously been insured as an additional driver on, for example, your parents' policy, call your insurer and ask if they'd be willing to take this into account for a no-claims bonus. Some insurers do this, including Direct Line*. See the Great Young Drivers Insurance Savings Hunt discussion for more tips and tricks.
Must I inform my insurer if I have an accident but don't claim?
If you have an accident, and damage someone else's car, but decide to cover the costs yourself, then strictly speaking, you should still tell your insurer about it.
Many don't, thinking it will increase premiums, yet a problem may arise if you have a second accident and it is found to be related to work undertaken for the first. If this happens it would most likely result in the claim not being paid, rather than the insurance being cancelled or being reported for fraud. But it could still end up costing you £1,000s.