NEW DRIVER NIGHTMARE: WHO’S PAYING THE MOST FOR INSURANCE?

Young drivers are facing eye-watering insurance costs, with new data showing that those aged 17-24 are being charged an average of £2,175 a year for car insurance. According to figures analysed by Zego, 18-year-olds are hit hardest, with premiums reaching £2,737 on averag, the most expensive age for new drivers.

The latest figures reveal that location, car type, and even gender can make a significant difference in how much young drivers pay.

Who is hit the hardest?

• 18-year-olds face the highest costs, with an average insurance premium of £2,737.
• By age 24, premiums drop to £1,534 on average—44% less than an 18-year-old pays.
• London is the most expensive region, where young drivers pay an average of £3,108 per year.
• The South West is the cheapest, with premiums averaging £1,646 per year.
• Male drivers pay around 30% more than females, with an average premium of £2,451 compared to £1,810.
• Car choice matters—a Peugeot 208 or Ford Fiesta is among the cheapest to insure, while a BMW or Mercedes-Benz can push premiums beyond £2,800.

A Zego CEO Sten Saar said: “Young drivers are always going to face higher insurance costs, but our data shows that with the right car, a telematics policy, and paying upfront, they can make big savings.”

WHY YOUNG DRIVER INSURANCE IS SO EXPENSIVE

Despite making up just 7 per cent of UK licence holders, young drivers account for 16 per cent of all road deaths, according to the latest government figures.

One of the biggest reasons for these high costs is accident risk. One in five new drivers is involved in a crash within a year of passing their test, making them a higher risk to insurers. Speeding is also a major factor, with data from the National Safety Council showing that young male drivers under 24 are one-and-a-half times more likely to be involved in a fatal speeding crash than females of the same age.

Time of day also plays a role. Young drivers are ten times more likely to be killed on urban or country roads than they are on motorways, as these roads present more hazards and encourage riskier driving behaviour.

HOW TO CUT THE COST OF YOUNG DRIVER INSURANCE

Despite the high prices, there are ways for young drivers to reduce their insurance bills.

One of the most effective methods is opting for a telematics-based policy, such as Zego’s smartphone-based system, which monitors driving habits and rewards safer drivers with lower premiums.

Car choice is another major factor. Smaller, lower-powered vehicles, such as the Peugeot 208 or Ford Fiesta, tend to be far cheaper to insure than high-performance models.

Paying annually instead of monthly can also lead to significant savings. According to data from Uswitch, young drivers who pay their insurance upfront save nearly £400 a year compared to those paying in instalments.

Adding an older, experienced named driver to the policy can also bring costs down, as insurers will view the policy as lower risk. However, drivers should avoid “fronting”—where a parent or older driver is listed as the main driver when they are not—as this is considered insurance fraud.

Other ways to cut costs include:

• Increasing the voluntary excess, which lowers the base premium but requires a higher out-of-pocket payment in case of a claim.
• Parking in a secure location, such as a driveway or garage, to reduce theft risk.
• Avoiding modifications, as changes to bodywork, larger alloys, or engine tuning can increase premiums significantly.

WHAT NEXT FOR YOUNG DRIVER INSURANCE?

With the cost of living crisis putting financial pressure on young people, car insurance remains one of the biggest barriers to getting on the road. However, Zego’s data suggests that price increases may be slowing, and that drivers who make smarter choices—from selecting the right car to opting for a black box policy—can avoid paying excessive premiums.

For now, experts advise young drivers to shop around for quotes, consider telematics-based policies, and avoid automatic renewals that could see them paying more than they need to.

Sources

The findings in this article are based on data from:

• Department for Transport
• DVLA Driving Licence Data
• Statista: UK Driving Licence Holders by Age
• National Safety Council: Speeding & Road Safety
• RAC Foundation: Young Driver Report
• Brake: Young Driver Safety
• Hastings Direct: Most Common Traffic Offences
• Bill Plant Driving School: Driving Test Statistics

Credit: https://www.zego.com/car-insurance/new-driver/