A Guide to Cheap Car Insurance for Students and Young Drivers

February 6th, 2020
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Whether you are preparing to take your driving test or have recently passed, you will likely be shopping around for the most affordable insurance policies.

As most young drivers are less experienced, insurers believe that they are more likely to make mistakes than drivers who have been driving for some time and have refined their skills. This means that car insurance for young and newly qualified drivers can be costly, but there are things you can do to secure lower premiums. Here are some of our top tips.

Telematics insurance

Also referred to as black box insurance, telematics policies often provide lower premiums for young drivers. Standard insurance policies are based on the average driver but telematics premiums are based on how conscientious and safe a driver you personally are.

Although cover might not always be cheaper than standard insurance policies from the beginning, provided that you drive safely, your insurer is likely to reward sensible driving with a discount on future premiums.

Most drivers with telematics policies benefit from discounts on their premiums of up to 10%. The best drivers can expect to be rewarded with a discount of up to 20% on standard policies.

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What is telematics insurance and how does it work?

With a telematics insurance policy, your insurance provider will install a black box in your car. This will allow them to monitor your driving habits and adjust your premiums based upon their analysis of the data they collect.

Your insurance provider will be able to monitor a variety of metrics, including how you handle corners, how you brake, and your driving speed. Responsible drivers will likely see their insurance premiums lowered in the future. So, if you believe you are better than the average driver in the UK, it will likely be worth having a telematics device installed.

Additional factors that might have an impact on the cost of future premiums include how many miles you drive and when you drive. This means that limiting your mileage and avoiding curfew times and rush hour can deliver additional savings.

Are there different types of telematics insurance?

Most telematics insurance policies use black box technology, but increasing numbers of policies are now using plug-and-drive technology and telematics apps.

Different telematics insurance providers might analyse your driving differently, so it will be worth checking precisely how your provider will calculate your unique driving score. For example, you should look into whether you might incur penalties if you were to drive after a certain time as the increased premiums resulting from this might make this type of insurance policy more expensive for you in the long run.

Why is telematics insurance useful for young drivers?

In addition to potentially providing you with access to lower premiums, telematics insurance policies have a variety of other benefits that other types of cover simply can’t offer.

As you will also be able to monitor your data via a smartphone app or your insurer’s website, this type of insurance policy can help you to improve your skills and make you a better driver. You will likely receive feedback on your driving and advice on where you can improve.

If you have a history of driving convictions, telematics insurance policies can reduce the cost of policies that will have been made more expensive by past mistakes.

For parents of newly qualified drivers, this type of policy can provide reassurance that they are driving safely and sensibly.

How do I get telematics insurance and what is the installation process like?

The way your telematics device is installed will depend on the type of device your policy provider uses. The installation of a black box will usually be arranged by your insurer. If you opt for a plug-and-drive device, this will simply be sent to your chosen address. When it arrives, all you will need to do is to plug it into your car’s cigarette lighter or charging port. If your policy uses an app and GPS technology, all you’ll be required to do is download it onto your smartphone device.

What does the telematics box record and who can see the data?

Insurers take data privacy very seriously and will use secure encryption, updates, authentication and firmware to protect your information.

Your insurance provider will keep the data they collect about your driving safe and secure. It will generally only be used to check claims and monitor your driving habits. Your provider might also choose to share it with some of their business partners, but they will never sell it on to a third party.

Current telematics devices do not record any in-car audio, and will only monitor very specific metrics including the number of miles you drive, driving and acceleration speed, and how you take corners.

Other metrics captured include:

  • Distance travelled
  • The type of roads you drive on
  • Journey times
  • Elevation
  • Number of journeys made

Temporary car insurance

Whilst it is important to note that purchasing temporary car insurance policies occasionally is not an acceptable or viable alternative to insuring a vehicle you own, there are instances when temporary cover is beneficial.

What is temporary car insurance and how does it work?

Also sometimes referred to as short term insurance, temporary car insurance will provide cover from between one and 28 days.

What are the benefits of temporary car insurance over naming a second driver?

This type of policy can be useful if you need irregular cover, want to borrow a friend’s car, are moving to a new house, or only need cover for a few days.

Is temporary car insurance an option for drivers under 21?

Although insurers generally provide cover for all drivers over the age of 18, many will only offer temporary insurance policies to drivers over the age of 21.

How your car might affect your insurance quote

There are a variety of factors that can affect your insurance premium, and the type of car you drive is a significant one. More expensive cars will cost more to replace if written off or stolen. Some cars might also cost more to repair, especially if they are less common.

More powerful and faster cars are more likely to be involved in accidents, so cars with a larger engine will typically incur higher insurance costs.

Is third-party or third-party fire and theft essential?

Third-party only insurance policies provide the most basic legal level of cover. Although this will protect other vehicles, people and property should you be involved in an accident, damage to your own vehicle will not be covered.

Third-party fire and theft policies will also allow you to claim for fire damage, damage incurred during an attempted theft, and replacing your vehicle if it is stolen.

Many people opt for these policies because they view them as being cheaper than comprehensive cover, but this isn’t always the case. In many cases, comprehensive policies are comparable in price, but it is also worth thinking about the benefits you will be missing out on by choosing a basic policy, for example, windscreen cover and a pay-out for your own vehicle if it is written off.

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