When Does Car Insurance Price Go Down? - .uk FAQs

Why does age matter?

Risk

The price of car insurance is calculated according to risk. Statistics show that younger drivers have more accidents, therefore they are higher risk and their premiums reflect this.

No claims bonus

The fact that younger drivers have had little or no chance to build up a no claims bonus is important too. A newly qualified 17-year-old driver will not have any no claims bonus, so they will not get any discount. Insurance companies do not yet know how much of a risk they are, so they have to ensure they cover their projected costs.

How can I reduce the price?

There are a number of things you can do to ensure you pay as little as possible for your car insurance, whatever your age:

Insurance groups

Buying a car in a lower insurance group is one of the best things you can do to lower the cost of your premiums. All cars are placed into one of 50 groups, with 1 being the lowest priced and 50 the highest. Insuring a car in a low group will cost significantly less, as the car is seen as less risky. This is an important factor to bear in mind when shopping for a car.

Black box or telematics

Insurers now offer special rates to those who use black box or telematics technology. This can either be installed in the car, or used as a smartphone app. It records your driving habits, which will be fed back to the insurance company. As long as you are a careful driver, this should lower your premium and help you to get cheaper insurance in the future. It can work against you, however, if you drive carelessly or too fast.

Add a named driver

If someone such as a parent is likely to use your car, then your car insurance can actually cost less if you add them to your policy as a named driver. If you are the one who uses the car most, then you must ensure you are the policyholder, however. Adding a driver to your insurance just to obtain a cheaper price is known as ‘fronting’ and is fraudulent.

Compare prices

Some financial experts advise people never to accept their renewal quote. Insurance companies rely on the fact that people may be too busy or tired to shop around, so the renewal price may not be very competitive. Using price comparison sites can speed things up, but remember they do not cover all insurers.

Pay annually

If you can, pay annually for your car insurance as it’s cheaper. Insurers charge extra for the privilege of paying monthly, so you will shell out more over the year.