Young drivers car insurance

By Olivia Gee ·
Young people driving with insurance

Under 25? Your car insurance premium may have just moved up a notch. Young drivers or those new to the road generally face a high premium or excess because they are statistically riskier drivers.

So, you might be lured into a sneaky work-around to minimise the extra insurance costs. But often it's just not worth it.

We’ve heard of young drivers recruiting parents to take ownership of their car insurance while nominating themselves as a young driver on the policy. It may save you some dough in the long run, but do you want to jeopardise a family member’s no claim bonus if you’re the cause of an accident?

Not to mention the fact you’d be missing out on building up loyalty discount and no claim bonus of your own. It pays to be independent, doesn't it? Let’s explore other factors of car insurance you need to be aware of.

Car Insurance Comparison Table - page last updated September 28, 2020

Search promoted car insurance below. Advertiser disclosure.

  • Comprehensive Car Insurance

    Get award winning Car Insurance. Save 15% ^ on your first year’s premium when you purchase a new policy online. Budget Direct offers tailor-made cover, new-for-old replacement, 24/7 claims, a highly-rated claims service, and get a hire car following a theft.

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $500 - $1,850
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • No Claim Discount
    • Online Discount Up To 15%
      Compare
    Details
  • Comprehensive Car Insurance

    Earn up 20,000 Qantas Points when you sign up for Qantas Car Insurance. Points awarded will be based on your premium. Get a quote to see how quickly the points add up. T&Cs apply.

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $400 - $1,850 (varies By State)
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • No Claim Discount
      Compare
    Details
  • Comprehensive Car Insurance

    Stella are changing the tune on car insurance, offering car insurance made especially for women. Features include no claim reward, new car replacement, customise your policy and more. Enter your car rego and get a quick quote online.

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    No
    Choice of excess
    coins icon
    $800 - $2,000
    Agreed or market value
    Car coin icon
    Agreed

    Available discounts

    • No Claim Discount
      Compare
    Details
  • Price Saver Comprehensive

    Protect your journey with Virgin Car Insurance. Get 15% online discount on Comprehensive cover and receive a $100 e-Gift card* when you purchase a new eligible Virgin Car Insurance policy by 30 September, 2020 (T&C’s apply).

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $500 - $1,850
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • No Claim Discount
    • Online Discount Up To 15%
    • Restricted Drivers Discount Available
      Compare
    Details
  • Comprehensive Car Insurance

    With many people driving less due to the current COVID-19 crisis, Youi are extending relief, offering new and existing clients a temporary 10% saving on car insurance premiums. Get a quote from the company that puts the people first.

    Monthly premiums
    Calendar icon
    Yes Costs Extra
    Choice of repairer
    tools icon
    Optional Extra
    Choice of excess
    coins icon
    $400 - $2,500
    Agreed or market value
    Car coin icon
    Agreed Or Market

    Available discounts

    • 20% Discount On Contents Insurance If Youi Car Insurance Also Held
      Compare
    Details

How can I get added to the family policy?

The family member that owns the car insurance policy will have to do the calling, not you. So set aside some time where you can discuss adding your name to the policy before they make the call. Make sure it benefits both of you, and that they understand the impact it may have on their policy if you cause an accident.

Generally, your family member will need to tell the insurer your age, gender, licence type, car type and any modifications, plus where it’s parked before getting an idea of how much the premium and excess will be.

Stand alone policy options for young drivers

You may be a young driver with a potentially costly car insurance policy under your belt. But if you’ve been driving everyday since you were 17 and you’re now 23 years old, that’s six years driving experience. If you’ve had a pretty good track record, then you could be entitled to a cheaper car insurance. No harm in asking.

The price you pay will be determined by the underwriter’s assessment of your personal situation. So if you can prove you’re not a typical high-risk young driver then you could save big bucks on your car insurance.

And if you set up your own loyalty and no claim bonus discounts, it can benefit your pocket for years to come.

Car insurance exclusions

There are heaps of young driver restrictions, from passenger limits to types of car models you’re allowed to drive, and even the time of day your insurance will cover you for. Get your head around it all by reading up on the RMS licence rules.

Young driver car insurance exclusions

Just like the road rules, it's pretty high stakes if you fail to follow your insurance instructions. You'll risk forfeiting your policy, and in some cases you can risk losing your licence for a period of time.

If you’re at fault in a car accident, there are many factors that could affect your driver’s licence or your car insurance policy. These include being found:

Learner Driver

  • With any amount of alcohol or illicit drugs in your system
  • Driving unsupervised or supervised by an unsuitable person (e.g. a learner, provisional license holder or someone with a disqualified license)
  • Exceeding permitted speed limit
  • Using a tow-bar
  • Using your mobile in any way, including hands-free
  • Misleading your insurer with the type of car you drive

P1

  • With any amount of alcohol or illicit drugs in your system.
  • Exceeding permitted speed limit
  • Misleading your insurer with the type of car you drive.
  • Using your mobile in any way, including hands-free
  • Exceeding the permitted weight when using a tow-bar
  • Carrying passengers under the age of 21 during restricted times

P2

  • With any amount of alcohol or illicit drugs in your system
  • Exceeding permitted speed limit
  • Supervising a Learner driver
  • Driving a high-performance car

Is this your first car insurance policy?

Becoming independent and setting up your first car is certainly an exciting time. But as you know, your premium is likely to be incredibly expensive compared to a driver with a good driving record and a full licence. Some of the key car insurance features you need to be aware of include:

Basic car, basic premium

The simpler your car, the less you pay. In most instances, you will not be allowed to drive a high-powered car until you have your full licence. If caught driving one, you may lose your licence, get penalised and if at fault in an accident, your insurer may void your policy altogether. 

Keep it clean and well-oiled

If you have a clean driving record while on your Ps, you may be rewarded with a discount on your policy. If you complete a ‘safe driving course’ you could see further discounts for your conscientious efforts.

Compare quotes

Car insurance is probably the last thing on your mind when purchasing a new car but it should never be rushed. Take the time to compare quotes, as you could save more than $1,000 per year, just by comparing! 

How to choose a car insurance policy: price versus features

It’s one thing to simply compare prices, and another to compare value for money. It may even be worth paying a little extra to get the features you really need for your car insurance.

Some car insurance companies will offer all or only a few of these features as standard within a policy. So if you’ve narrowed down your search and are hung up on a couple of these options, make sure you ask if it’s already in an existing policy.

Emergency or roadside assistance

This is for that moment when you're broken down on the highway and need some help with the engine. Many comprehensive policies come with roadside assistance included, but with others you’ll have to opt-in and pay extra.

Optional car hire

This is usually an addition to your policy, but some will cover you for a certain period or dollar amount if you require alternative transport after a not-at-fault accident or theft. Check your Product Disclosure Statement (PDS) for details.

Optional rating protection

It's not a common feature, but one worth asking about. If you’re in an accident, you may pay an annual fee to keep your premium or no claim bonus intact. Check the fine print on this one.

Market value vs agreed value

If your car is only worth $9,000 (according to the insurer) and you insure it for $20,000, then that’s an agreed value. Some insurers will cap the agreed value. 

Easy payment

Some insurers will offer a discount if you pay your policy for the year in one lump sum. If it’s out of budget, then we recommend paying in instalments. You may miss out on a discount, but your payments will be easier to manage. Want to save even more? Purchase your car insurance online and you'll usually get a discount on the first yearly premium.

Insurance Tip: Do you know the difference between third party property and comprehensive car insurance? It’s not as simple as it seems, but the more you read up and compare policies the more you’ll comprehend the essentials.

*Any information provided on this page should be considered a summary and general advice only. All information should be verified before purchase via the relevant Product Disclosure Statement (PDS).

^See information about the Mozo Experts Choice Car Insurance Awards

Mozo may receive advertising fees from the financial institutions, issuers of financial or credit products and third party advice providers that are shown on this page. These fees are based on a cost per click, cost per acquisition, or a fixed fee.

Olivia Gee
Olivia Gee
Money writer

As one of Mozo’s money writers, Olivia Gee shares her research and insights across banking, insurance and property to help readers save. She loves getting stuck into a story, unveiling all the facts, breaking down stats and drawing on personal experiences - this is what drives her as a journalist. She has a double degree from the University of Wollongong, with a BA in Journalism as well as Media and Communications.