7 factors that affect the cost of car insurance: a new driver’s guide

Millions of people purchase car insurance without knowing why they have been quoted the price they’ve received.

It is important for you as a new driver to know what affects the cost of your car insurance to make sure you know what you need to or can do to keep your costs down. Here are the key variables insurance companies use to determine the cost of car insurance and the price you’ll pay (in no particular order):

1. Your years of experience will affect the cost of car insurance

How long you have held a full driving licence affects the cost of car insurance, simply because less experienced drivers are more likely to be involved in a collision and make a claim.

A simple way of reducing the cost of your young driver insurance is to find another driver to name in your insurance.

This works best if it is someone older than you, like your parents; coupled with the number of years (or even decades!) they have spent driving.

The best checklist to follow for this is:

  • At least 5 years older (older is better)
  • Is someone who is aware of, and happy to be a named driver (imperative!)
  • Has 0 points on their licence (the lower the better)
  • Has not claimed on their own insurance countless times (deemed less of a risk)

A word of caution about insurance fraud

A word of caution to all of this; putting somebody else as the main driver and you as the named driver is illegal and will probably result in insurers rejecting claims.

Don’t do it, even if everyone says they’re doing it or have done it!

A survey conducted by GoCompare Car Insurance in February 2019 found that of 1000 parents, with children aged between 17 and 25 who had passed their driving test, a staggering 10% had insured their child’s car in their name. Worryingly, another 34% of parents said they would consider doing the same; called ‘fronting’.

‘Fronting’ is actually considered as an offence of insurance fraud; the results of which are extremely serious. Again, our advice is don’t do it! It’s just not worth the risk.

Top Tip: You can gain more experience and prove it to your insurance company by taking a Pass Plus Course or an Advanced Driving qualification from the Institute of Advanced Motorists

2. Engine size and its impact on the cost of car insurance

The larger an engine your car has, the higher a cost your insurance will be.

Sometimes the difference between a 1.9 and a 1.6 can be over £1,000. The higher the engine size, the most likely statistically you are to have an accident, especially as a new driver.

Top Tip: Hold out on the car you’ve always wanted for at least a year and get yourself a 1.4-litre engine (or smaller).

Your bank balance will thank you for it.

3. Where you live

If you live in an area with a high rate of car-related crime or insurance claims you’ll be hit with a higher insurance quote.

For the insurance company, they see you as more of a risk if you live in an area where your car is more likely to be stolen, broken in to or vandalised.

Top Tip: It would be a stretch too far if we were to advise you to move away just to reduce your car insurance cost, however, if you are a student living in term time in an area with a higher crime rate than at home, you may want to consider leaving your car at home.

4. Age

The younger you are, the more of a risk you are.

Statistically, you’re much more likely to be involved in an accident if you are 18 than if you are 25.

Top Tip: Unfortunately there’s nothing you can do to tackle this particular variable, other than to be a safe and considerate driver so young people in years to come don’t have to pay out as much as you did.

5. Stealability of your car

This variable is assessed on how prone to theft your car is. So this depends on the type of security your car has and how many are stolen or broken into of that type.

Don’t pimp your ride; modifications will most likely increase your insurance

If you had grand ideas about pimping your car up, raising or lowering it, adding larger wheels or other hip and trendy things, you may want to reconsider.

Car insurance companies do not like modified cars. Period.

One of the reasons for this is because they know that a car works best when it is left to how the experts (the manufacturers) made it.

They know that modifications people make to their car such as a raised back are things the car manufacturers did not do out of safety.

If you have the salary of a rap superstar then, by all means, modify your car to your heart’s content, otherwise, keep it sensible.

Top Tip: Look at investing in additional security measures for your car. Ring insurance companies up to see what they recommend and how much this will affect the cost of your car insurance.

6. Profession

Insurance companies categorise people into professions. The most expensive professions to be in car insurance-wise include footballers, delivery drivers and travelling salespeople.

Top Tip: Do not, under any circumstances lie or stretch the truth about what your profession is. Inaccurate information when found out will make your insurance void.

7. Car safety features

The more safety features your car has (particularly for fully comprehensive insurance) the cheaper your insurance will be.

An increased number of safety features makes you less of a risk to the insurance company.

Top Tip: Consider carefully what car you get with regards to safety features. This not only will save you money but could potentially save your life.

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