Keep Costs Down When Adding Young Drivers
Are you getting ready to add a young drivers to your car insurance policy? Be careful to do this in the right way, or you could see your premium climb an extra £5,000 per year.
Car Insurance is Expensive for Young Drivers
Car insurance rates for drivers under the age of 25 are extremely high. Rates for these young drivers can cost as much as £1,800 a year. That’s usually too expensive for most young people to afford. As a result, many parents add the kids to their existing auto insurance policy.
Even so, parents will see their own premium skyrocket. However, there are some ways to help keep premiums a little easier on the wallet.
Comparison Shop for a Lower Car Insurance Premium
Experts recommend that parents comparison shop before adding young drivers onto their policy. The reason is that by doing a little research, it may be possible to find a lower premium that includes the younger driver.
Before you begin the process, be sure to have this information put together:
- Personal information: including address, date of birth, occupation, driver’s license, marital status (for each person you want to add to the policy)
- Vehicle information: mileage, date of purchase, VIN (vehicle identification number) for each car.
- Driving history: should include all claims, violations and tickets (for the past 5 years) for each person, plus any driving courses are taken
- Current or previous insurer’s name
- Then you’ll need to decide on the type of coverage you want.
With all of this information, you’ll be ready to visit insurance comparison sites. Be sure to use more than one site, as the prices for premiums will vary. It’s always a good idea to write down the quotes you receive, so you can use this information to compare with other sites.
Add an Experienced Driver
Another way to save on your monthly premium is to add a second more experienced driver or someone that has a no-claims policy. These will help reduce the cost of your auto insurance.
You can also consider adding your spouse to your son or daughter’s policy as a named driver, as long as they have a good driving record. However, beware that the named driver on the policy must occasionally drive the car. If not, then you will be guilty of fronting.
Fronting is illegal and is often done by parents as a way to help their kids save on car insurance. Not only is fronting illegal, but it’s also a fraud, which carries serious consequences that include a criminal record. So, avoid this issue by ensuring the named driver really does use the car once in a while.
Consider Adding a Black Box to the Car
Another way to save money on auto insurance is by choosing a telematics policy. A telematics policy can save you quite a bit of money. Under this type of car insurance, the insurer installs a black box on the car used by the younger driver. The black box gathers data on the driving habits and behaviours of the young driver.
If the driver does a good job, then the insurer may lower the insurance premium. However, driving badly could also increase your monthly premium.
Third-Party May Not Be the Best Choice
When it comes to buying motor insurance, there are three different types to choose from:
- Third-Party Only
- Third-Party Fire & Theft
- Fully Comprehensive
Third-party is the most basic type of car insurance legally required to operate your vehicle on the road. On the other hand, a fully comprehensive policy is the most expensive.
With a third-party policy, if your car is damaged in an accident, third party coverage will pay for repairs to the other vehicle involved, but not your car.
Most people believe that buying only third-party coverage for their kids is good enough. However, remember that insurers view young drives as a higher insurance risk. Experts warn that some insurance providers may set a higher third-party premium for younger drivers. However, they may offer a lower premium for a comprehensive policy.
So be sure to carefully check the price differences when comparison shopping for an auto insurance policy. Prices vary greatly from provider to provider.
Try Different Job Titles
Another way to try to lower your car insurance premiums with a younger driver is to try different job titles when comparison shopping. Make sure the job title is correct.
For example, an editor will have cheaper rates compared to a journalist. The reason is that the editor will mostly be in the office and not drive as much, while a journalist will be on the road quite a bit. This is only an example – just try to find a job title that is correct, but that has cheaper rates. You may be able to shave quite a bit off the cost of your premium.
No matter which method you choose to save on premiums, be prepared, as adding a younger driver will still make your premium quite a bit higher. This is because insurers see younger drivers (under age 25) as a higher risk.