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Student car insurance

Student life can be expensive. Choosing to use your car at uni can add to that expense dramatically. This guide explains why student car insurance costs are so high, and how you can try to keep them as low as possible.

In This Guide:

Why is car insurance more expensive for students?

On average, 17 to 24-year-old drivers pay £2,231 to run their car in its first year, over half of which is spent on car insurance. As a student, it’s hard to avoid paying more for your car insurance. This is because you haven’t been driving long enough to build many years of no-claims bonuses or had the driving experience to prove you’re a safe driver.

Even as a mature student you’re likely to see your premiums go up. Whilst this might seem unfair, you are put into the student risk category regardless of your experience.

But why is student car insurance so much higher?

  • University campuses are often in city centres which have higher crime rates.
  • Student housing is an easy target for thieves and most student residences won’t have a secure driveway or garage for you to park your car.
  • Students fall into the “high-risk” category so insuring students is a bigger risk and prices reflect this.

What types of insurance are available?

There are three types of insurance available for your car:

  • Third-party insurance. This is the most basic cover needed to drive legally. It covers you for damage you may cause to another vehicle, or if someone is injured and it’s your fault; this includes passengers in your own car. It does not cover damage to your own vehicle.
  • Third-party, fire and theft insurance. This is the same as third party insurance, but you will also be covered if your car is stolen or damaged by fire.
  • Fully comprehensive insurance. This covers all of the above but also protects you as a driver and you are covered for damage to your own car.

The cost of your car insurance will reflect your level of cover. So, third party insurance is much cheaper than fully comprehensive insurance, but you will have to pay for what is not covered by your insurance policy yourself.

How do I keep my car insurance low?

As car insurance for students is more expensive, it can be hard to manage financially with all the other costs of being a student. However, there are ways to keep your car insurance as low as possible without compromising on cover:

  • Only pay for the cover you that need and avoid add-ons and optional extras. 
  • Pay annually if possible, to avoid monthly interest.
  • Telematics or “black box” policies base your premium on how well you drive and can cut the cost for well-behaved drivers.
  • Advanced driving courses such as Pass Plus or other qualifications can cut your insurance costs, but make sure your insurer recognises the qualification (and offers a discount) before taking the course!
  • Smaller cars with small engines are in lower insurance groups and are therefore cheaper to insure.
  • Adding a named driver to your policy can reduce your premiums but be careful to avoid fronting.
  • Avoid modifications as these are considered high-risk to insurers and will raise the price.
  • Temporary or short-term insurance may be the answer if you borrow someone’s car occasionally (for example, your parent’s car).
  • Investing in extra security for your car can offset some of the risks associated with student drivers.
  • Compare car insurance policies online to help you save money and get the right level of cover for a lower price. You can use our free online comparison tool to find the cheapest car insurance deals as a student.

What if I leave my car at home?

Another way to keep costs low is to leave your car at home during term time. You can keep your insurance policy running but make sure to tell your insurer that your annual mileage will be lower as this can, in turn, lower your premium and help build your no claims discount.

Leaving your car at home can also lower costs by cancelling your insurance. If you choose to do this, you’ll have to keep your car off the road and make sure you register your vehicle as off the road with a Statutory Off-Road Notification (SORN) which will cancel your tax. You will then need to cancel your insurance separately.

If you declare your car off-road you cannot drive or park your car on a public road until you tax and insure it again. The only exception is driving your car to and from a pre-booked MOT. Driving your car for any other reason can lead to prosecution and a fine of up to £2,500.

What to watch out for

When looking for cheap student car insurance make sure you are aware of potential pitfalls. Don’t buy too much insurance, especially if you are only using your car to visit home during the holidays. It may be better to look for temporary insurance as you will only pay for the time you are using your car.

If you aren’t insuring your car, make sure to declare it off road (SORN notice). Otherwise, you must insure your vehicle or you could face hefty fines.

Be aware of fronting, when you insure your car with someone else as the main driver and you as the secondary driver in order to lower your insurance costs. It is illegal and will invalidate your policy. You can also face criminal charges for driving whilst uninsured if you are found to be fronting.

Make sure your car is registered to the address where your car is kept for most of the year. Failure to inform your insurance provider of your correct address may invalidate your policy if you need to make a claim.

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