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Guide to insuring your first car

Guide to insuring your first car

Buying your first car can be a daunting process, but so can looking for car insurance. The amount of money you might be asked to pay can be staggering, particularly for young drivers who have just passed their tests.­­­

While you might think that car insurance is something you don't need to think about until you have a car sorted, the amount you pay on your insurance can be dependent upon the type of car you buy, so it's important to consider both aspects at the same time.

Here are some top tips for how to ensure you pay a reasonable price when taking out your first car insurance policy.

A newly qualified driver in her new Carbase car


Think about what type of car you buy

As stated above the type of car you choose to buy will affect the amount you pay on your car insurance. Higher value vehicles will cost more to insure as they cost more to repair in the event of an accident. However, a cheap car doesn't necessarily mean a low insurance policy - high power vehicles (even if you have brought it cheap) aren't unlikely to come with an affordable policy. Our extensive range of first cars have been specifically identified as vehicles which are easy to drive for first time buyers and ones which cost a reasonable amount to insure.


Type of car insurance

There are three types of car insurance so don't be fooled into thinking that you must purchase the most expensive type. It's all about determining what level of cover you need and how much you would be prepared to pay in the event of something happening to your car. The three types of car insurance are:

Third-party only - this only covers you against damage to other people, cars and property. If your car got damaged you would need to pay for it yourself.

Third-party, fire and theft - same as above but it covers your car if it's in a fire or stolen.

Comprehensive - this covers everything including any damage your car sustains in an accident. 

Remember, with whatever level of cover you choose you will always be asked to pay excess and voluntary excess. This is an amount you will need to pay before the insurance company pays any money themselves. Having car insurance in place does not mean you won't need to pay anything in the event of an accident.


Do you have to buy insurance as soon as you buy a car?

In short, yes.

There is no grace period for insuring a car, and even if the drive home from the dealership is only 5 minutes, your car must be insured.

There are a few options when it comes to insuring your car:

You can insure your new car before you pick it up, letting your insurer know the date you need the cover to start. You'll need to provide all details ahead of time, including the registration and some insurers may require your logbook/V5C.

You can also sort out your insurance at the dealership after buying the car, but before you drive away.

Another option is to get temporary insurance that covers you from an hour to a month, meaning you can drive your new car home and sort out more long-term insurance at your leisure.


What makes insurance so expensive for new drivers?

There are several factors that affect the cost of someone's insurance and they're quite far-reaching.

One of the big ones is the no-claims bonus (NCB), which refers to how many years a driver has not made a claim; the higher the NCB, the lower the insurance premium. New drivers, not having had the chance to build up this number, do not benefit from this bonus.

Another important factor for new drivers' insurance is their age; many (but of course not all) new drivers are quite young. The inexperience (and in some cases, recklessness) that comes with youth means insurers attribute a higher risk to younger drivers, which puts up their fees.

Other factors include the car's make, model, age, value, anti-theft measures and safety features, where your car is registered (to determine accident and crime rates of the neighbourhood), where your car is kept (such as on a driveway or in a private garage), the kind of cover you opt for, the value of the voluntary excess, and how you intend to use the car (when and how far you'll travel).


How can I save money on my first car's insurance?

Of course, you'll want to save as much money on your insurance as you can, and there are a number of things you can do to bring down your premium.

1. Choose your car wisely

As mentioned above, the car you choose affects the cost of insurance you'll pay for it. Every car produced in the UK is sorted into one of 50 groups based on its value at new, repair costs and times, performance, safety, security and bumper compatibility. The cars in group 1 (such as Fiat Panda, Skoda Fabia and Vauxhall Corsa) are the cheapest to insure and those in group 50 (Audi A8, BMW 645 and Mercedes-Benz S Class) are the priciest. You can see the groups here.

2. Pay upfront

Paying your car insurance monthly enters you into a credit agreement which accrues interest in the same way a loan does - you're better off paying your annual premium upfront to avoid any interest.

If you're not in a position to pay it all in one go, you could look at alternative finance options such as using a 0% credit card - just be sure to meet the monthly repayments and finish paying off the balance before the interest-free period ends.

3. Increase your excess

You can also reduce your insurance premium by increasing the voluntary excess on the policy. Your excess is the amount that you will cover in the event of a crash or theft, for example, if your excess was £750 and repairs following a crash totalled £1,200, you would pay the first £750 and your insurer would cover the remaining £450.

It works as a form of 'put your money where your mouth is' and reassures the insurer that you are less of a risk.

4. Install a dashcam or black box

Being open to having your driving recorded demonstrates to the insurer that you are less of a risk than other drivers, and this can reduce your insurance premium by up to 30%.

Similar to a dashcam, a black box records data about your driving such as speed and braking - big indicators when it comes to safe driving. It also acts as a tracking device if your car is stolen.

5. Increase security

Installing devices such as alarms and immobilisers, and parking in more secure areas such as private garages can help to reduce your car insurance fees.

6. Use comparison websites

Look at multiple insurers to find the best deal for you. Comparison sites such as Compare the Market and uSwitch are very helpful when it comes to looking at multiple offers, and you can still look at other providers who may not be on comparison sites to ensure you get the deal that suits your needs best.

When doing this, consider which type of cover is most suited to you and only pay for what you need.


Can I save money by being a named driver?

A named driver is an additional person that can drive another vehicle where somebody else is the main driver. For example, your parents may add you as a named driver onto their car insurance policy, and you'll have the same level of cover as them. A new driver can also add a more experienced driver to their policy. This will bring down the insurance cost for the new driver but will likely increase the premium for the more experienced driver.

When adding a named driver to a policy, the person who is identified as being the main driver really must be the main driver. When a named driver is the person who does most of the driving instead of the main driver, this is known as fronting - it is a form of car insurance fraud and is illegal.




If you think that now is the time to get your first car, contact us today and to explore our range of used cars click here.


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