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Young drivers insurance guide

Young Drivers' Insurance

Tips, discounts, cashback & more

Tony Forchione
Tony Forchione | Edited by Helen Saxon
Updated 9 February 2021

The cost of car insurance for under-25s dropped a little in 2020 as the various lockdowns meant there've been fewer claims. But, with the average car insurance cost for a 20-24-year-old still over £900/yr, premiums remain eye-wateringly high. Use our step-by-step guide to find out how you can cut costs.

Aged 25 or over? Head over to our main Car Insurance guide.

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1-min read to find your cheapest car insurance

Many can save £100s by switching car insurance policy. Here's a quick lowdown if you know what you're doing – alternatively, if you need a bit more help, you can read our full guide below:  

1. NEVER just auto-renew – instead combine comparisons to scour 100s of insurers in mins. Comparison sites don't search identical insurers, nor give identical prices, so try as many as you've time for in this order: Confused.com*, MoneySupermarket*, Compare The Market* and Gocompare* (see how we rank 'em).

2.Check big insurers, and hot deals, that comparisons miss. Direct Line* doesn't appear on 'em, and can be competitive. You also won't find some special deals – see hot deals comparisons miss.

3. See if these counter-logical savings work for you. It's worth checking if choosing comprehensive over third party, adding a responsible (often older) extra driver or tweaking your job title can save you cash.

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10 ways to cut young drivers' car insurance costs

Here are our top car insurance cost-cutting tips for young drivers that can save you £100s.

  • 1. Don't assume third party is the cheapest

    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.

  • 2. Adding a responsible 2nd or 3rd driver can cut costs, eg, your dad or Aunt Dot

    Adding a second driver should push the cost up, yet bizarrely it can cut your costs. 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 cut the premium by around £1,000. These seven tips show how it can cut your costs...

    • Car insurance is all about risk. That's why it can work, if you're a high-risk driver and you add someone who is a much lower risk as a 2nd (and/or 3rd) driver, they can bring down the average risk and you may get a cheaper policy.

    • This isn't just for young drivers. While it works well for young drivers as they are automatically seen as a high risk and know many people, like their parents, who may be lower risk it can work for anyone – but of course is especially powerful for those with costlier insurance.

    • The better the driving history and lower their risk, the more impact it should have.Those with a good driving record are likely to help make the most savings, but anyone who's a lower risk can help. By law insurers can't discriminate over gender, but age, driving experience and history can make a difference.

    • This is about trial and error not logic. Your mum may increase the cost, your brother may cut it, or vice versa. It's just a question of trying different quotes and seeing what happens.

    • Different insurers respond in different ways: One may cut your costs adding your uncle, another may increase it. Therefore a quick way to check is by varying quotes on comparison sites – it's easy to do, see our top comparison sites list below.

    • The second driver should be someone who would reasonably drive your car. So don't add Lewis Hamilton, unless you happen to be his brother (and even then racing drivers are likely a very high risk so I wouldn't bother) – but your mum, son, best mate or gran should be OK – as long as they would drive the car.

    • Never add someone as main driver if they're not. This is known in the industry as 'fronting' and is fraud. If you do it and are caught you can face a criminal conviction and your insurance will likely be invalid.

  • 3. Getting insurance 20-26 days ahead can be the cheapest time to buy, and can save £100s

    An MSE investigation in which we analysed more than 50 million quotes from three of the biggest price comparison sites revealed buying your car insurance three weeks ahead of the start day can save £100s compared with buying it 30 days in advance – when fewer insurers return quotes – or at the last minute as you’re deemed as higher risk (see the full price investigation).

  • 4. Make yourself attractive to the insurers

    Whether or not you're a young driver, insurance premiums (the payments made to insurance companies) depend on three things:

    insurance premium factors

    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.

    • Does the car type affect 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

    • 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.

    • Pimping your car can invalidate your insurance

      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 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 carriage ways 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.

  • 5. See if legitimately tweaking your job title could save £100s

    Another quick win is tweaking your job description (legitimately of course). An illustrator is often cheaper than an artist, an editor than a journalist, a PA than a secretary.

    Have a play with our Car Insurance Job Picker tool 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'm 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.

  • 6. Tell 'em the truth, the whole truth and nothing but the truth

    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.

    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.

  • 7. Never auto-renew. Loyalty is expensive

    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.

  • 8. Multicar cover can save you £100s if you live with your parents or have more than one car

    If you have more than one car in your immediate family or household, this could be for you, and having different renewal dates needn't be a blocker. For some, discounts for adding multiple cars could save £100s, or even £1,000s in some cases, but for others it could actually be more expensive. 

    What tends to happen is multicar newbies get hot offers to suck 'em in, but that advantage can disappear at renewal.

    As comparison sites don't offer multicar discounts, you'll need to check the multicar price directly with the insurers below, and then compare those prices with the individual policy costs you get using comparison sites. Here are three steps to follow... 

    Get quotes for all cars on one policy. The big one is Admiral MultiCar*, while Aviva* and LV* also provide multicar policies. If your policies start at the same time, it's easy. If not, see below.

    • If you have different renewal dates, this is how it works

      The three insurers above let you set up a policy at your first car's renewal, while the other car(s) stay with their existing insurer, until their renewal.

      So you can get a multicar quote for all your vehicles with different start dates, eg, get cover for your lead car to start in three weeks' time, car two to start in seven months and car three in 10 months. Cars two and three will stay insured with their existing insurer until their current policy ends, at which time they will move across to the multicar policy, for the remainder of that term. 

      When you pay for the additional car(s) and when the discount kicks in differs (see table below). Once your multicar policy ends, all cars will be up for renewal at the same time.

    • How to compare prices

      If you want your multicar cover for all your vehicles to start at the same time, it's simple, you'll just be given one total cost. For different start dates, you'll be given a total price to pay, which'll cover all the cars (you just pay for however long each car is insured for), and you'll also be given an 'annual equivalent price', as if all vehicles were insured for a full year, to help you compare against other providers. 

    • 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.

    • Grab long-lasting quotes to lock in today’s price

      Some insurers such as Aviva* and Quotemehappy have quotes that are valid for 60 days.They let you get a quote two months before your renewal is due, and keep that price, beating any possible future premium increases.

      That quote should still be valid even if you get another quote nearer the time and the price has gone up. However, the price is fixed subject to you not changing any of your details.

    Separate policies with a discount. This is where you get separate policies with the same insurer, but you get a discount on the second vehicle. Insurers to try: More Than* 15% | Axa* up to 15% | Privilege % varies | Sheilas' Wheels* 10%. Also add Esure* to the list of insurers to check, as they also give a multicar discount.

    If you're not already a customer, you can take out two policies in quick succession to get the discount. Tip: Insure the car with the cheapest premium first because you'll usually get the discount on the next 'additional' car (and subsequent cars).

    Use comparisons for each car separately. Often it's likely just finding the cheapest standalone insurer will win anyway. So always do a comparison (see Combine comparison sites below), then try the deals directly below to compare.

  • 9. A telematics policy (aka black box) policy can save you £100s

    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 your cover via a telematics policy. Be warned, however, that driving badly could also see your premiums increase.

  • 10. Set the excess right 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 do 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.

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How to find the cheapest car insurance

Once you know the basics from our top 10 tips for cutting costs, it's time to follow the steps below.

Warning: No matter how tempted you are to say someone else is the main driver, or to pretend you have no points, or to deliberately underestimate your mileage to get a cheaper premium – don't. You must be completely honest or it could invalidate your insurance and even lead to prosecution. 

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Step 1: Get quotes from the top comparison sites 

Firstly, visit the comparison sites as these zip your details off to a number of insurers' and brokers' websites to find the cheapest quotes. As no single site captures the entire market and prices vary, combining a number of sites is the best way to make a saving. It's best to use all four, but if you don't have time, we've ranked them in order of the sites that most often return the cheapest quotes so you've the best chance of bagging the top deal.

  • How is the order picked?

    When ranking comparisons, we want to get you to use the best ones, as quickly as possible. We focus principally on price, as depending on who you are, you can get cheaper quotes on different screen-scrapers. However, we also factor in 'softer' features to assess the quality of each.

    Ranking on price

    We analysed the prices of a large range of insurance quotes given by Compare The Market, Confused.com, Gocompare and MoneySupermarket.

    • Step 1. Check how many times each comparison site returned the cheapest or within £5 of the cheapest quote.
    • Step 2. Rank the comparison sites in based on their 'score' in the first category.
    • Step 3. Assess how often each comparison gave a unique cheapest quote, ie, not just equal cheapest with a higher-scoring comparison.
    • Step 4. Alter the order to see if it's possible to increase the speed with which you access the cheapest quotes.

  • If I use a comparison site will it show up on my credit file?

    Yes and no. Comparison sites send your details to a raft of insurers, they then use information on your credit file to judge your quote. This leaves a 'soft search' on your file which you can see as a reference if you get your credit report – but this worries many people.

    Yet crucially lenders CAN'T SEE these soft searches, so they have no impact on your credit worthiness. The only time a hard search – which lenders can see – may go on your file is if you then go on and actually apply for insurance; specifically 'pay monthly' insurance (because they effectively pay upfront for you and you repay the loan over the year).

    More info in our Will buying insurance from a comparison site affect my credit score? 60-second guide.

  • Which comparison sites offer incentives?

    Some comparison sites include 'free' gifts for every policy you take out. At CompareTheMarket.com there's a soft toy meerkat (you can choose from eight) for each new policy plus 2for1 cinema tickets and 2for1 at 1,000s of restaurants (see Meerkat Movies & Restaurant trick for full details).

    Though remember, don't end up paying a higher premium than you need to because you are sucked in by the incentives on offer from one particular comparison site.

Confused

First try Confused.com* as our analysis shows it gives the cheapest quote for the majority of people.

Try it*

MoneySuperMarket

If you move on to MoneySupermarket* next it'll boost your chances of getting the cheapest quote as it was the second-best site.

Try it*

Comparethemarket

Thirdly, get a quote from Compare The Market* as it's the next best at returning a cheap quote.

Try iT*

GoCompare

Then try Gocompare* (next best) as it'll mean you've covered all of the big four comparison sites to increase your chances of a cheap quote.

Try it*

Try to nail down all the quotes

If you still haven't found a deal you're happy with, or want to push the envelope, there are some more options to try. Try QuoteZone* if you have time – usually takes about five to 10 minutes.

  • 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: Get a quote from an insurer comparisons miss

Comparison sites let you compare 100s of insurers quickly but they don't capture the entire market as some large competitive insurers only offer their products directly. 

So benchmark your cheapest comparison quote against prices offered by Direct Line*, as you won't find them on a comparison site, unless you go direct.

Step 3: Hot deals comparisons miss

If you can't get cashback it's worth noting a few companies have special deals not mentioned by comparison sites. These include:

Post Office

Free basic RAC cover via Post Office

Buy a new motor insurance policy directly from Post Office and you will get Roadside and Recovery vehicle based cover free for a year.

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.

Pay how you drive (telematics)

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.

telematics policies

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.

Specialist providers to consider

Several providers offer telematic products. Here we've listed a selection of the best around.

  • 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. Motorists aged 17-25 who get Co-op's* young driver insurance will have a box fitted to their cars to monitor their acceleration, speed, braking, cornering and what time they're driving. You can pay upfront for the year or by direct debit.

    But to gain a discount before buying, download the Co-op young driver app to your smartphone and drive 200 miles over at least 10 different days to get a driving 'score'. You'll then receive a link via email and any discount (up to 20%) will be automatically applied to your online quote.

    The price of the insurance (and the amount of discount) can vary, depending on how well the car's been driven. The better you drive the more discount you're likely to get, and continued bad driving could see your insurance cancelled.

learner driver insurance

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.

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.

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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.

Cashback websites

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.

cashback websites

Those new to cashback sites should ensure they read the Top Cashback Sites guide for pros and cons before using them. 

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 screen scrapers' 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.

illustration

Coronavirus car insurance cost-cutting

Many of us are using our cars much less than normal, whether that's because we're furloughed from work, working at home or just not going out as much due to the lockdown.

Yet it's led to many asking whether they still need car insurance, or if they can just cancel. Others have asked if there are ways to cut costs without going that far. We've help for both scenarios...

  • Not using your car? You can declare it 'off the road' to save on tax and insurance

    Since 2011, you need insurance when you own a car, not just if you're driving it. But there's an exception to needing to pay.

    If you can keep your car on private land, for example, your drive or garage, or a friend's property, you can declare it off the road via a Sorn (statutory off-road notification).

    This cancels your vehicle tax, which may net you a pro-rata refund for the rest of the year. Once you've declared it off-road, you can then cancel your insurance, though do note your car won't be covered for damage, fire or theft. You also you won't get the year's no-claims bonus and you'll often need to pay an admin fee for cancelling (though some have waived this – see a round-up of 20 top insurers below).

    In light of all that, is it worth doing? Here's Martin's view...

    The difficulty is we don't know how long lockdown will last. If it's just weeks, this'd be a faff for a small saving. Yet if you don't think you'll drive much anyway even when the rules relax, for example, if you've two cars and are only likely to use one, it could save you cash. Though do remember if you've no car insurance, your car isn't covered for damage or theft.

    However, if you think it's for you, here's how to do it, how to reverse it, and the risks involved:

    • Step 1: How to Sorn your car

      You can do it on the DVLA website, and it's effective once you've made the declaration.

      The DVLA will then work out whether you're owed a refund of unused vehicle tax. If you are, you get any full calendar months back – so if you Sorn your car on Saturday 25 April, and it's taxed until 10 July 2020, you'll get May and June's vehicle tax back. 

      The DVLA will automatically issue a cheque for the refund and send it to you, though this can take up to six weeks to come. 

    • Step 2: How to cancel your insurance (or check if you can get 'laid-up' cover)

      Once you've declared your car off-road, you can then cancel your insurance. There's often an admin fee of about £50 to pay, though some insurers have waived this entirely and in almost all cases will do if you're in financial difficulty due to coronavirus.  

      A few insurers let you cancel online; Axa is one. But for most, such as the AA, Aviva and Esure, you will need to call, so currently you could face long queue times. Check your insurer's website to see if you can cancel there, or if not, to get its phone number.

      You should be entitled to a refund if you've paid upfront for an annual policy, provided you haven't claimed since it started. If you pay monthly, your insurer is likely to tell you to cancel your direct debit.

      You also won't earn any no-claims bonus for the year, so you'll need to be making a substantial saving to make this work.

      Don't want to cancel your insurance fully? See if you can get 'laid-up' cover...

      'Laid-up' cover is when the car is insured against fire, theft and damage, but not for any use on the roads. It's often bought by people restoring classic cars, which aren't yet roadworthy. You will need to keep the car – like you would for Sorn – on your drive, in your garage or on other private land.

      However, if you're Sorning your car during coronavirus, it may be worth seeing if your insurer offers it as it gives a level of peace of mind if anything were to happen to the car. As you're not driving and far less likely to have an accident, laid-up cover is usually much cheaper than full insurance cover.

      But many insurers don't offer it: Aviva, Axa, Churchill, Direct Line and More Than all said they don't. But if you're an existing LV policyholder, it told us you can reduce the cover to 'laid-up' insurance, and then reinstate – with the inclusion of road use – when needed.

      Check with your insurer if it can offer this reduced level of cover.

    • Step 3: Know the risks of Sorning

      The main risk of Sorning the car is that you won't have cover for anything that happens to it. So if the vehicle gets damaged, stolen or goes up in flames, you won't be covered for any claim (unless you've bought 'laid-up' cover). 

      You also will lose your year's no-claims bonus if you cancel your insurance partway through the year. This is less of an issue if you're a couple of months into the policy, but may be a bigger issue if you've only a month or two left. 

    • Step 4: How to get your car back on the road

      Once lockdown's over, if you're heading back to work, or back to your normal routine, it's easy to get your car back on the road.

      First buy the insurance (see how to find a cheap policy). Then go to Gov.uk and re-tax the car. This will automatically 'unSorn' the vehicle.

  • I'm still driving but much less than I used to. Can I save on my existing policy?

    Insurance is all about risk, so the more chance they think you have of claiming, the more they charge. So driving more, or having riskier drivers on your policy, will likely mean you pay more. 

    The good news is that driving less often reduces that risk, so here are three things to look at that could result in a saving. But insurance pricing is personal to you, and much also depends on how much you'll save from these changes and whether your insurer charges admin fees if you change things around (see a round-up of 20 top insurers below). So try these to see if they work for you:

    • Reducing the estimated mileage

      It stands to reason that the more you drive, the more likely you are to get into an accident, whether it's your fault or someone else's (though bizarrely not driving enough miles could class you as 'inexperienced').

      Your mileage will be specific to you and your 'risk profile', but when we looked at insurance data, we found savings could be had. As an example, in our tests of 80+ quotes, the average saving dropping from 15,000 to 3,000 miles a year was £155/yr – though this is just £13 saved if you've a month left on your policy.

      Similarly, dropping from 8,000 miles a year to 6,000 only saved an average £24 over the year, just £2/mth.

      If you're going from a very high mileage to a low mileage, this could work, but if you're already on quite a low mileage, you're unlikely to see big savings.

    • Changing the usage

      Driving for work is normally pricier than just social, domestic and commuting purposes – so it may be worth having a read of your insurance certificate to see if it includes business use.

    • Removing younger, or riskier, extra drivers

      Younger, or higher risk, drivers pay more as the insurer – in simple terms – classes them as riskier drivers. This also includes those who have a history of claims and/or points etc. But if you remove 'em, they'll be breaking the law if they drive your car.

      Savings can be bigger here. Based on over 500 quotes, removing under-25s from the policy resulted in an average saving of £675/yr (or £56/mth).

    So is it worth changing an existing policy for these savings? Our view is that it's a faff, so you'll need to have many months left on your policy to make it worth it, and big savings from the changes, eg, large mileage drops, taking younger drivers off a policy.

    For everyone else, use this as a trigger to check if you should look for a new policy, as big changes can mean another insurer is cheaper, and you may have been overpaying anyway.

  • Help if you're struggling to pay each month

    If you're struggling to pay your insurance premiums because your income's been affected by coronavirus, your insurer should help you. It should first review your policy to make sure it's suitable and as cheap as it can be. If that doesn't help, then it should work with you on a repayment plan that suits you both.

    While any help you get will be based on your individual circumstances, measures your insurer might offer could include:

    • Reviewing your policy. This is the first port of call, and insurers would look at whether you can drop extras you may not be using, such as key cover on car insurance. Insurers could also look at whether a cheaper policy with lower cover levels may be suitable. 

    • A (further) payment deferral. This is likely to be a short-term measure only, and may be offered if your circumstances are still changing, and you're not able to commit to a longer-term measure such as setting up a repayment plan.

    • A (further) period of reduced payments. If you can pay something but can't make the full contractual repayment, your insurer or premium credit lender may agree to you making reduced payments. Again, this is likely to be short-term only.

    • Waiving or reducing interest. If you can't meet your payments, the insurer or lender needs to make sure the amount you owe isn't rising out of control, so it may need to cut or waive the interest it's charging you. 

    • Agreeing a repayment plan. This is where your insurer or lender works with you to set up a plan that doesn't meet contractual repayments, but allows you to pay off the debt in a reasonable amount of time. 

    However, the FCA says insurers and lenders SHOULD report any further forbearance (such as extra payment deferrals) after 31 October to credit reference agencies. Lenders will need to let you know if the support they're offering you would have an impact on your credit report. 

    The measures above cover all types of general and protection insurance, and it also includes premium credit providers – these are the companies that give you a 'loan' meaning you can pay monthly premiums rather than annual.

  • How do I make a change to my policy, and is there a fee?

    This depends on your insurer. Many let you make the changes online (eg, Admiral, Axa and Direct Line), but not all (eg, Age Co, Hastings Direct and LV). If you're in financial hardship, you'll need to call your insurer to discuss your options.

    Most insurers will waive admin and cancellation fees if you're struggling to pay monthly, but some have extended this to include any coronavirus-related change, such as reducing your mileage. Sadly not all have done this and while we're unable to list all insurers, we have a round-up of 20 big insurers' policies below. If yours isn't listed, check its website for details as most have info about the help they are offering.

    Bear in mind that you may need to reverse the changes once we get back to some semblance of normality, so make sure you've calculated the admin fees against the savings you could make. 

    Insurers' fees for coronavirus-related changes – see which have waived them

    Insurer If you're in financial hardship For everyone else NotesTABLE_CELL_STYLE
    Cancellation or change fee (1)

    Allows payment holiday?

    		 Cancellation fee Change fee (1)
    AA £0 ✓ £0 £0 All fees have been removed until at least the end of May. Normally £58 to cancel, £25 to change.
    Admiral £0 ✓ £55

    £9.50 (online),

    £25

    (by phone)

    		 You can pause cover providing you Sorn your vehicle and reactivate cover within 90 days (if 33+ days before renewal).
    Ageas Will consider waiving fees ✓ £50 £0 (online),£25 any other way Assessing on a case-by-case basis. 
    Aviva £0 ✓ £38 £0 (online) For 'non-financial hardship' changes, you'll be charged an admin fee if you call when you're able to make the change online.
    Axa

    £0

    		 ✓ £52.50 £0 (online),
    up to £10 any other way    		 For 'non-financial hardship' changes, you'll be charged an admin fee for making changes by phone.
    Bell £0 ✓ £55

    £9.50 (online),

    £25

    (by phone)

    		 You can pause cover providing you Sorn your vehicle and reactivate cover within 90 days (if 33+ days before renewal).
    Churchill £0 ✓ £53.76

    £0 for mileage amendment

    or £28.66

    		  
    Dial Direct £0 ✓ £60 £20  
    Diamond £0 ✓ £55

    £9.50 (online),

    £25

    (by phone)

    		 You can pause cover providing you Sorn your vehicle and reactivate cover within 90 days (if 33+ days before renewal).
    Direct Line

    £0

    		 ✓ £48.16 £0  
    Elephant £0 ✓ £55

    £9.50 (online),

    £25

    (by phone)

    		 You can pause cover providing you Sorn your vehicle and reactivate cover within 90 days (if 33+ days before renewal).
    Esure £0 ✓ £0 £0 Fees only apply if the change is not as a result of coronavirus – £60 to cancel, £26 to change.
    Hastings £0 ✓ £45 Up to £30 (see notes) No fee when changing mileage, use, occupation, level of cover or extra drivers.
    LV £0 See notes £40 £15 Doesn't offer payment holidays, but you can apply for a £20-£50 grant if in financial difficulty.
    More Than £0 ✓ £0 £0 Fees only apply if the change is not as a result of coronavirus. 
    NFU Mutual £0 ✓ £0 £0  
    Privilege £0 ✓ £53.76

    £0 for mileage amendment

    or £28.66

    		 For 'non-financial hardship' changes, will only waive fees for short-term mileage amendments during the coronavirus pandemic.
    Quotemehappy £0 ✓ £50 £0 Changes can only be done online.
    Saga Will consider waiving fees ✓
    		 £50 £25 Assessing on a case-by-case basis.
    Swiftcover £0 ✓ £52.50 £0 (online), up to £10 any other way  

    (1) A change fee would cover any amendments to a policy, such as decreasing mileage, adding or removing an additional driver or removing an 'added extra' such as key cover. 
    Correct at May 2020.

    Quick Questions

    • What if you were charged a fee?

      If you were charged a fee – before the Financial Conduct Authority introduced new guidance for insurers on Monday 18 May – to make a change, or to cancel your policy, because of Covid-19, there is a chance you could get the fee back.

      While you have no right to a refund, there is no harm in asking, as David's email shows...

      I cancelled my car insurance on 18 May, to read in the MSE newsletter that More Than may be waiving cancellation fees. On 20 May, I complained and got the £50 fee refunded.

  • Lost your job? You MUST tell your insurer about this and other major changes

    You need to tell your insurer about big changes in your circumstances, such as losing your job, changes to how you use your car, big mileage alterations, plus new convictions or medical issues. You'll also need to tell it if you're moving home as this'll affect where the car's kept.

    However, you don't need to tell it if you're furloughed from your current employer.

    Major changes can lead to a charge or, better, a saving. Yet even if it'll cost more, you do need to tell your insurer. If you've not been entirely truthful with it, your insurance could be cancelled.

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 20-24-year-old is over £900, paying by installments can easily add in excess of 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 screen scraper and a broker?

    Brokers and screen scrapers 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.

    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.

    Screen scrapers are different: it's like sending someone round supermarkets and bakers to note all their prices.

  • Are there any ways to get a no-claims bonus faster?

    Some schemes do offer an accelerated no-claims bonus. MSE's forumites have suggested 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.

  • 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.

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 small print. It's always worth trying to call your provider first, but, if not, then…

Free tool to help you complain

This tool helps you draft and manage your complaint. It's totally free to use, and it's offered by Resolver, a firm we work with to help people get complaints justice.

RESOLVER – FREE COMPLAINTS TOOL*

If the company won't help, Resolver also helps you escalate your complaint to the free Financial Ombudsman Service.

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