Maw Comms news
Young drivers spend on average £6,071.00 getting their first car on the road
- The cost of car insurance for 17-year old drivers has fallen by nearly 50% since 2012
- More first cars are now bought using PCP or lease finance than using a personal loan
- Driving lessons cost an average of £528
A new report out today from GoCompare Car Insurance has revealed that the cost of getting a young driver on the road has fallen to £6,071.
The combined cost of a new young motorist learning to drive, buying, taxing and then insuring their first car has fallen by £775 in the last year from £6,846 to £6,071.
The drop is attributed largely to young drivers spending less on buying their first car (£3,562 compared to £4,276 in 2018) and the average car insurance premium for a 17-year old driver falling from £1,852 in 2018 to £1,737 in 2019.
In fact, analysis of over 2.3m car insurance quotes generated by young drivers using GoCompare reveals that the average lowest car insurance premium for a 17-year old driver has fallen by nearly 50% from £3,392 in 2012 to £1,737 in 2019.
Download the full report here
The cost of getting on the road
|Average spent buying first car||£3,562|
|First year Vehicle Excise Duty (road tax)1||£125|
|First year insurance premium||£1,737|
|Provisional driving license (apply online)2||£34|
|Driving lessons to successful test (22 lessons)3||£528|
|Driving tests (theory and practical – taken on a weekdays)2||£85|
|Total cost of getting on the road||£6,071|
|Year||Average lowest premium|
The cost of car insurance constitutes over a quarter (29%) of the total ‘new driver’ bill and 36% of parents said the cost of car insurance for their child was far greater than expected with 45% indicating that the cost of car insurance was a major concern. 11% said their child has delayed getting a first car specifically because of the cost of insurance.
However, choosing the right first car can considerably reduce insurance costs for young drivers. For example:
The average lowest annual premium for 17 to 24-year-old drivers wishing to insure a Range Rover valued at between £3,400 and £3,600 was £2,736.
However, for young drivers insuring a Peugeot 108 of similar value, the average lowest annual premium was £802. A saving of £1,934 for a year.
Buying their first car
Young drivers, some with help from their parents, spent on average £3,562.00 on their first car, a fall of £714 from 2018. 42% of parents have contributed or intend to contribute towards buying their child’s first car.
In fact, 16% of the parents responding to this survey said their child’s first car was bought using PCP or it was being leased, compared to 10% purchased with the help of a personal loan.
- £3,562 – Average amount spent on a first car
- 45% of parents help with the cost of car insurance for their children
- 16% of first cars purchased via PCP finance deals or leased
- 59% of parents think that young driver insurance premiums are a ‘rip-off’
License, lessons and tests
On average, learning to drive will set a young driver back £647.00 when the costs of obtaining a provisional driving licence (£34), lessons and test fees are combined.
The UK’s theory test costs £23 and the driving test costs £62 on weekdays or £75 in the evenings or at weekends, where available. GoCompare’s research revealed that young new drivers typically take 22 driving lessons before passing their test, so with driving lessons costing on average £24 per hour**, the average bill for lessons alone is £528. Purchasing lesson packages in blocks of 10, 20 or even 30 hours can bring the price down.
Lee Griffin, founder and CEO of GoCompare said: “At around £6,000 the cost of getting a new driver on the road is a substantial drain on teenagers’ and their family’s finances. Although buying the first car still accounts for the majority of the initial expense, the first car insurance premium can also cost into the thousands. Hence why so many parents are dipping into their own pockets to help their children out.
“However, the surprising good news is that the cost of insurance for new drivers has fallen substantially since 2012 as the average premium is nearly half what it was eight years ago. The introduction of telematics or ‘black box’ style insurance which utilises the latest technology to monitor drivers and reward safer driving has undoubtedly helped to lower costs.
“Car insurance for younger drivers is still expensive compared to those with longer safe driving records. Statistics show that the type and cost of claims for newly qualified drivers are more expensive for insurers to settle, hence the higher premiums. However, there are some simple steps young drivers can take to try to keep their premiums as low as possible whilst staying on the right side of the law. And they should remember that some insurers will offer more competitive premiums than others when quoting for young drivers and they should always compare quotes from a number of different insurers to ensure they get the right cover for them at the best price.
“Choosing the right car, preferably not too old and with a smaller engine to start with, can make a significant difference to the price of the car insurance and ultimately the total cost of getting on the road. The £6,071 initial does not include the everyday running costs of owning a car like servicing, maintenance and fuel. So, a few hundred pounds saved by securing a lower premium could pay for many miles of motoring for a new driver.”
GoCompare experts have produced some money saving tips to help younger drivers pay less for their car insurance.
Choose a sensible car – Young drivers’ insurance premiums will be lower if they drive a standard car with a small engine (under 1000cc) in a low insurance group. It makes sense to drive something smaller and slower until they’ve built up some no claims bonus and have shown a safe driving record. Also, avoid cars with modifications, as they can push the price of insurance up.
Analysts at GoCompare found that the average lowest car insurance premium for all quotes generated by drivers aged 17 to 24 was £1430. However, the average lowest premium for a Peugeot 108 valued at between £3,400 and £3,600 was £802.
Consider opting for a higher excess – This may lower the premium, but you will need to decide if paying a slightly lower premium is worth the risk of having to contribute more towards the cost of a claim if you have an accident.
Select a ‘telematics’ policy – Some policies require your car to be fitted with a ‘black box’ transmitter and others do a similar job with a smart phone app. In both cases the idea is that your driving is monitored by the insurer and your premiums can come down faster than with a traditional policy if you prove to be a safe driver.
Added extras – consider whether you really need added extras such as a courtesy car, legal assistance, breakdown cover and key cover. Some policies include these types of cover as standard or as add-ons but they’re not free. The cost will be built into the premium, so you may be able to save money by removing them or choosing a different policy without all the bells and whistles.
Adding a safe driver – Adding another named driver with a clean licence and several years claim free driving to a young driver’s policy could reduce their premium. This is one way a parent can help their child to get lower premiums without breaking the law.
Drive safely – By being careful on the road you will avoid accidents, fines and penalty points, all of which will affect your insurance premium.
Gocompare.com has produced a guide looking at the cost of getting on the road for young drivers here: https://www.gocompare.com/car-insurance/guide/the-cost-of-getting-on-the-road/
For further information please contact:
Anders Nilsson or Louisa Marsden at GoCompare on 01633 654 054 / 01633 655 132
Gordon, Jason or Liz at MAW Communications on 01603 505 845
Keep up-to-date with GoCompare on Twitter: @GoCompare
Notes to editors:
* Between 19th and 20th of February 2020, an online survey of 2,084 randomly selected Great British adults was executed by Maru/Blue. For comparison purposes, a probability sample of this size has an estimated margin of error (which measures sampling variability) of +/- 2.1%. The results have been weighted by age, gender, region and social grade to match the population, according to Census data. This is to ensure the sample is representative of the entire adult population of Great Britain. Discrepancies in or between totals are due to rounding. All car insurance premium information provided from analysis of GoCompare’s own data using actual customer comparisons.
1 – Vehicle excise duty based on a Vauxhall Corsa 1.2i registered before 31 March 2017 paid in one payment – £125 per year
2 – Provisional licence – apply online £34, apply by post £43. Driving test fees – theory test £23, practical test £62 (weekdays) or £75 (evenings, weekends and bank holidays) – source Gov.uk website
3 – Average cost of a 1 hour driving lesson is £24 – Source AA. Maru Blue research found new drivers had an average of 22 driving lessons before passing their tests.
GoCompare is a comparison website that enables people to compare the costs and features of a wide variety of insurance policies, financial products and energy tariffs.
GoCompare does not charge people to use its services, and it does not accept advertising or sponsored listings, so all product comparisons are unbiased. GoCompare makes its money through fees paid by the providers of products that appear on its various comparison services when a customer buys through the site.
When it launched in 2006, it was the first comparison site to focus on displaying policy details rather than just listing prices, with the aim of helping people to make better-informed decisions when buying their insurance. GoCompare has remained dedicated to helping people choose the most appropriate products rather than just the cheapest, and has teamed up with Defaqto, the independent financial researcher, to integrate additional policy information into a number of its insurance comparison services. This allows people to compare up to an extra 30 features of cover.
GoCompare is the only comparison website to be invited to join the British Insurance Brokers’ Association (BIBA) and is authorised and regulated by the Financial Conduct Authority (FCA).