Young driver's insurance - get the best deal plus read about the "Black Box"
For a newly licensed young driver, the promise of their own transport and independence signals an exciting phase of their life, but for many, the cost of insuring a car is prohibitively expensive.
Indeed, the average annual comprehensive cover for a 17 to 22-year-old is more than £1,100. To keep your insurance premium as low as possible, follow these tips.
What you need
When it comes to insuring your car, you have three basic options - third party, where you are only insured for damage caused to other cars, third party, fire and theft, and fully comprehensive. In theory, third party should be the cheapest of those three types, but that is not always the case, as insurers often see third party cover as a sign that you'll be more careless, and push up your premium as a result, so be sure to check all the options when you come to getting quotes.
There have been many reports recently of parents being listed as the main driver of their child's car, thereby reducing the insurance costs. But remember, 'fronting', as it is called, is against the law. Instead, consider adding a responsible driver with a good driving record as a second 'occasional' user. It doesn't always cut the cost, but it is definitely worth checking before you buy.
Lastly, don't be tempted to tell porkies. Telling your insurer that your car will be garaged when it's actually parked on the road, or that it is alarmed when it is not, counts as insurance fraud - and it will, at best, invalidate your policy.
Comparing the market
When comparing insurance quotes, don't just stick with one comparison site. The likes of Money Supermarket, Go Compare and Compare the Market don't all compare precisely the same insurance providers, so it pays to take a look through them all.
Such sites are extremely easy to use these days, and it is important to play around with the policy terms to see whether it makes a difference to your quote. For instance, will you really need a courtesy car should yours go in for repairs, or legal advice in the event of an accident? Say no and you'll probably knock a chunk off your premium straight off the bat. Another important consideration is the excess. A low excess figure will bump up your policy price by a sizeable amount, so move that slider to see what difference it could make if you up it. Of course, it will mean that you'll need to fork out if you have an accident, but for careful drivers, it could make a significant difference to your premium.
Don't forget too that there are some insurers that don't appear on comparison sites, so do check the likes of Aviva, Direct Line and LV, some of which will offer a discount for buying online. Alternatively, look into a multi-car policy with your parents' insurer.
Whichever quote you choose, it's worth clicking through to the actual insurance provider's site, just to ensure that your policy terms match what you've asked for. And don't assume that a monthly payment plan is the best option. For the over-30s, it's a useful way to spread the cost, but if your premium is upwards of £1,000, the interest charged for a pay monthly option could really bump up the annual cost. Instead, think about getting a credit card with zero per cent on purchases and paying the whole whack.
Given the eye-watering premiums many young drivers are forced to pay these days, a number of specialist insurers have sprung up. Some of these use 'telematics', a device fitted to your car, which monitors your driving. That means that if you stick to speed limits, avoid slamming on the brakes unnecessarily, and opt for gentle acceleration and cornering over Formula One-style driving, you can earn rewards such as money back on your premiums.
Try iKube or the unappealingly named Drive Like A Girl for specialist insurance for 17 to 25 year olds, or others such as Coverbox or Insure The Box, which are effectively 'pay as you drive' schemes that allow you to top your miles by driving safely. The AA's Drivesafe policy, which uses GPS technology to monitor your driving and adjust your premium accordingly, is another to consider. However, do remember that some of the above will charge extra if you drive between 11pm and 5am, and others will prohibit overnight driving, traditionally a high-risk time for youngsters on the roads.
Specialist brokers are also worth checking out, so try Swinton,and Only Young Drivers for quotes.
Don't be lazy when it comes to policy renewal. Insurers rely on consumers' apathy to bump up policy premiums, but the market is extremely competitive and they all want your business, so always check comparison sites for a new quote before the year is up. If you are keen to stick with your current insurer, it won't do any harm to haggle.
Black Box.Is it right for you?
An investigation by Mail Money has found that drivers who opt for 'black box' insurance could be setting themselves up for fines, hidden costs and even cancelled policies.
Black box insurance, which monitors the safety of an individual's driving, thus
supposedly lowering insurance premiums over time, can actually result in hidden
fees and even fines for those breaking the speed limit.
Mail Money found that in most circumstances and insurance provider would warn a driver if he or she has been found to regularly break the speed limit but in some cases fines of up to £100 have been issued.
Black box insurance users have also found that the lengthy tomes of small print that come with each policy have proved misleading or difficult to understand. Drivers with iKube, for example, have been stung with charges of £100 a night for driving outside of its curfew hours of 11pm to 5am.
A number of black box insurance providers also charge the customer should they sell their car or switch providers.
Mike Powell, insurance analyst at research company Defaqto ,said "Black box insurance carries so many fees and charges, they need to be made much, much clearer.
"It's very easy for drivers to be taken in by the technology, along with the promised drop in premiums, but they can end up paying out a lot more than they thought."
The technology was only introduced over the last five years but it has proved a hit among young and newly qualified drivers, lured by the promise of cheaper insurance quotes for safer driving.
The black box technology sees a GPS system fitted to the underside of the car, which transmits information about the style and quality of driving (speed, acceleration, braking) to the insurer. The customer is then rewarded with cheaper insurance premiums if he or she displays a good and safe standard of driving.
But a number of young and inexperienced drivers have found they are not being rewarded, as buried in the terms and conditions for Admiral's policies (provided by subsidiary Bell), it states: "We compare your driving with that of other customers and calculate a score based on how you drive - and how your driving compares to other customers.
"At renewal, we will use this score and performance group to determine if your renewal price should be discounted or increased."
So, with a huge proportion of black box insured motorists displaying impeccable driving manners, it could mean that nobody receives a discount come renewal time.
Graeme Trudgill, of the British Insurance Brokers' Association, said "Black box is still relatively new so many insurers are still exploring the options.
"Some insurers are waiting to see if it is simply only those drivers predisposed to driving cautiously anyway that will use it or if it will significantly change those less cautious drivers' behaviour too."