Understanding Insurance

Guide to car insurance for young drivers

Car insurance for under 25s can be costly,  young motorists aged 17 – 24 are considered the riskiest drivers on the road, this is backed by industry data and the reason premiums can be higher at this age.

Higher premiums come at a time where disposable income isn’t exactly in abundance, with many people in their late teens and early twenties still in education or just beginning their careers.

This guide will help you gain a better understanding of car insurance and the factors considered when calculating a premium.

What levels of car insurance are available?

There are three levels of car insurance available in the UK, each with differing levels of cover. They include:

Third party only (TPO) – covers any damage to third parties but not you or your vehicle.

Third party, fire and theft (TPFT)– in addition to third party, this type of cover also includes theft and fire damage to your vehicle.

Comprehensive – this is the highest level of cover available in the UK and in addition to TPO and TPFT, comprehensive also covers damage to you and your vehicle.

While each tier of insurance includes more cover, comprehensive isn’t necessarily the most expensive. This is because the other two options are often seen as riskier by insurers. Don’t opt for a lower level of cover simply because it’s lower price, ensure you’re getting the correct level of cover you need.


Telematics is a great way for younger motorists to lower their insurance costs. It works by fitting a small device (black box) into your car that records information on your driving style and patterns which it then relays to the insurer. This allows the insurer to base the premium on your driving habits rather than the data of the 17 – 24 age group and could potentially reduce premiums significantly.

What influences car insurance premiums?

There are many factors which help insurers determine an insurance premium. Below are some common ones which you are typically asked about during your initial questions to receive a quote.

Age – as mentioned earlier, unfortunately for younger drivers age has an influence on premiums. The 17 – 24 age group is considered riskier than any other age group by insurers and therefore premiums will be higher.

Insurance groups – Cars are categorised into groups to help insurers calculate premiums. They consider the new car value, cost of parts and repairs, car performance and security. The lower the insurance group the lower the premium. Read our handy guide to car insurance groups for a more detailed breakdown of the factors insurance groups consider.

Occupation – There is a risk associated with your employment status and role which has an influence on your premium. For instance, if your role involves frequent travel you could receive a higher premium than someone who works a standard 9 -5.

Address – Areas with higher vehicle crime rates and levels of traffic are considered riskier by insurers.

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