Owning your first car can be a life-changing experience, but it generally won’t be cheap and it will add to your responsibilities. Often the first thing you’ll need to do is buy car insurance. While buying first-time car insurance for drivers over 25 may not be much of an ordeal, younger drivers may struggle to find an affordable policy.
One of the simplest ways to keep costs down is to consider the kind of coverage you need from your insurance policy, and then find an insurer who offers the right policy. You may need to compare policies from different insurers before settling on the one that best suits your needs.
I’m looking for the best first-time car insurance policy. What are my options?
The cost of your policy will depend on your experience and history as a driver. Your first car insurance policy is, therefore, likely to involve a compromise between the best possible coverage and the affordability of that policy. This may be the case, especially for those under 25 years of age or with very little driving experience.
One way of thinking about insurance for first-time drivers is to consider how much coverage you need, rather than wondering who the best first car insurance company is. You will always need to start with Compulsory Third-Party (CTP) insurance, which covers your liability for anyone injured in an accident caused by you. You also may want to consider if buying a third-party property damage policy that covers damage to other cars or property, which is also your liability if you cause the accident, may also suit your budget. If you live in a bushfire-prone area, or a high-crime neighbourhood, you may also want to consider buying a third-party fire and theft insurance policy that covers your car for damage from these incidents.
For some young drivers, either of these additional policies is sufficient in terms of coverage and maybe relatively affordable. If you’re paying off a car loan or have a car that needs specialised maintenance, you may also need a comprehensive car insurance policy, which tends to cost the most but offers greater coverage against the widest range of incidents. A short-hand way of learning about how car insurance cost varies with policy type and coverage is comparing car insurance quotes, particularly for first-time drivers. This may also help you find out how you can bring down the premium or the cost of the policy.
How to get cheap car insurance as a first-time driver
If you don’t have much driving experience, you may be paying more for car insurance no matter how old you are. Insurers may even ask you to pay an inexperienced driver excess in addition to the basic excess on the car insurance policy. This translates into more out of pocket spending if you cause injuries and damage in an accident and are liable to pay compensation. However, apart from choosing essential coverage, you can lower the cost of car insurance by taking a few precautionary steps and checking if you’re eligible for discounts.
Some insurers may agree to charge you a lower premium if you complete a defensive driving course or if you install additional security equipment in your car. Similarly, you may get a discount if you agree to drive only under specific conditions, such as only driving with a more experienced driver in the car with you or only on roads with lower speed limits. You could also get a discount for buying a policy online, and if you choose the same insurer that your parents have.
Again, you can think about the cost of car insurance even before you buy your first car. Choosing to buy an easy-to-replace vehicle which may not cost much to repair may save you a lot in terms of car insurance. Also, premiums can vary based on the colour of the car and not just the make and model - picking a popular colour can be another way of bringing down your insurance premium. You may also be charged less on car insurance if the vehicle is regularly parked in secured parking, such as a locked garage. Over the longer-term, though, there may be no substitute for accumulating years of safe driving experience.