Newly qualified drivers are one of the most discriminated against groups on the road. This is due to insurance premiums being calculated based on statistics; with drivers that lack experience being statistically more likely to have an accident and hence make claims which their insurer will have to foot the bill for.
In attempt to compensate for these likely expenses, insurance companies offer significantly higher premiums to statistically risky drivers. Newly qualified young male drivers are perhaps the worst effected; standing to pay up to four times more than the average driver for the same levels of cover.
Insurance is not the only running cost expense which might take new drivers by surprise; with fuel also needing to be considered. However, this doesn’t mean the end of the road as there are still a number of actions that can be taken to ensure that motoring is affordable upon passing your test.
Insurance prices
The AA reports that the average car insurance premium has more than doubled in the past seven years from £456 in October 2004 to £921 in October 2011.
These rises are being attributed to the increased number of claims that are being made by motorists on the back of the credit crunch and the progressively more prevalent ‘no win, no fee’ legal services which are being advertised on television. This has resulted in the number of claims being made increasing by 70% over the past decade according to the BBC.
Car insurance companies are forced to pick up the cost of these claims; and are therefore attempting to remain profitable by charging higher premiums on policies. The AA’s Simon Douglas commented: “The past two years have seen the biggest-ever rises in premiums as insurers struggled to close a widening gap between premium income and claims costs.”
However, there are a number of things that can be done to bring down car insurance premiums:
• Less miles = miles better- The fewer miles a driver states that they are going to be travelling when arranging for insurance cover, the statistically less likely they are to be involved in an accident and make a claim or having a claim made against them. You should therefore keep your stated mileage allowance to a minimum but bear in mind that your policy could become void if you have an accident after having exceeded your stated limit.
• The name of the game- Adding additional named drivers to your policy that are either older and/or more experienced will reduce the statistical likelihood of claims being made in the eyes of the insurer who will assume that driving duties are being shared between the inexperienced motorist and the other named driver/s.
• Living to excess- Offering to pay a higher voluntary excess on top of the compulsory one will result in cheaper premiums being offered on account of the insurer not having to fork out as much if a claim is made.
• Feeling secure- Parking your car in a secure place like a locked garage will result in cheaper car insurance quotes being offered as it is less likely that the vehicle will be either stolen or vandalised.
• Mod it up- Making performance enhancing or aesthetically pleasing modifications to your vehicle, such as the addition of spoilers or alloy wheels, will result in higher premiums. However, not all modifications will be frowned upon; with security enhancing features such as the addition of alarms and/or immobiliser bringing cheaper prices.
One key point to bear in mind is that opting for third party cover rather than fully comprehensive is no longer likely to be a cheaper option; this is despite the fact that third party packages offer less protection. This is a recent trend which was sparked by the fact that higher risk motorists such as newly qualified or young drivers tended to opt for this as it used to be the cheaper option. However, this resulted in those opting for this level of cover being statistically more likely to be involved in accidents and having claims made against them.
Become a Drivers Edge UK member here.
Sharing is caring – Tweet & Like this for your friends to see!