Passing your driving test is a major achievement in a young person's life. You get the keys to the car and the freedom of the road. At least in theory. As many young people are discovering, the cost of insuring your first car can often be a deterrent. In fact it's not unusual for insurance costs to be several times the value of the car.
The simple answer to the question is risk. Young drivers are by definition less practiced than older drivers and as a result of this they are statistically much more likely to be involved in an accident. It's also much more likely that an accident involving a young driver will be severe. Young drivers tend to have bigger and more damaging accidents. They crash at higher speeds than older, more experienced drivers. They cause more damage to their vehicles and have a higher possibility of serious injury and death.
All of these factors are factored in when an insurance company decides on how to provide a policy and the premiums that young drivers should pay.
So how do you get around this? Many young people use their parents names and details for insurance purposes. They state on the policy that the car is owned by a parent and that the parent will be the main driver. They name themselves as a secondary driver in order to avoid the large cost that comes with a separate policy. It's a very common practice but it's actually fraud and it's illegal. Many people don't realise that this trick, which is know in the industry as "fronting" can lead to criminal prosecution. If you make a false declaration on your insurance application you are actually committing a crime and may find that you are actually driving without insurance, another serious crime.
It's a difficult and discouraging situation for young drivers, so what can you do to reduce the costs on insuring your first car?
Firstly, make sure you buy the right kind of car. It's no good buying something fast and sporty if you can't afford to drive it. Buy a small car with a small engine, it's not very sexy but it will allow you to reduce your premiums and begin earning that all important no-claims discount.
When you have your small car avoid the temptation to modify it. Insurance companies don't like modifications and will make you pay extra. Don't think you can avoid this by not telling them as if you have an accident there is a chance that your policy will be invalid.
Lastly, take the time to find cheap young driver insurance. Competitive policies are possible but it does mean that you might have to spend some time doing research and making phone calls.
Why is car insurance for young people so costly? This is a question that most insurance brokers hear on a regular basis. It's not abnormal for the cost of insuring your first car to be three or four times the value of the car itself and this seems like an absurd situation for young drivers.
The best solution to find cheap young driver insurance is to shop around and compare deals with as many companies as possible.
Author Resource:-
Doug Walker Dip CII is General Manager of Academy Insurance Services Ltd. Academy is an independent insurance broker specialising in niche insurance markets such as cheap young driver insurance and buy to let insurance.
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