Car Insurance for Young People: There are many young people who decide to get their driving license just turned 18 years. Once the permit is obtained, buy a car or leave one to enjoy the road. However, the story does not end there, before doing so you have to hire a car insurance or they include you in the policy you will use if you already have one contracted.
The search for insurance for a person under 25 at a good price can be a complicated task, however, it is a legal requirement of mandatory compliance to be able to travel through Spanish territory.
The obligation to hire a car insurance
Whatever age you have, you need to hire, at least, the compulsory insurance. A duty of all the vehicles “suitable to circulate on the surface of the earth and driven by the motor”, according to the Regulation of compulsory insurance of Civil Liability in the circulation of motor vehicles.
Not having this policy can bring you a considerable fine in addition to the immobilization of the vehicle, so do not play it and hire it before getting behind the wheel. Obligatory Liability insurance is commonly referred to as “mandatory insurance”, SOA, or “third-party insurance”.
What exactly covers Third Party insurance?
The compulsory insurance covers only the damages that a vehicle causes to a third party when the driver is included in the policy. That is, if you are guilty of an accident where material or personal damage has occurred and your insurance is only mandatory, the insurer will be responsible for the costs arising from the damage caused to others but not the damages themselves. And this as long as the driver is included in the policy.
Are insurers obliged to insure you?
As we have seen, you must hire a Car insurance to be able to move, however, insurers have no obligation to insure you. Companies can get in the way because when they are under 25 years of age, the risk they acquire if they take out a policy with them is greater.
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Your short experience and age, or the specific vehicle you want to insure (if you buy one with a lot of displacement) can be an impediment to “open your doors” as a new customer. So much so that while some do contemplate the possibility that at 18 you can be a policyholder, others require a minimum age of 21 or even 25 years.
In the most extreme case, it is possible that no company wants to insure you, and since you need insurance to travel, you must choose other routes.
Nobody assures you? Go to the Insurance Compensation Consortium
There is a Public Entity, called Insurance Compensation Consortium, which is responsible for hosting all those who are not admitted to any private insurer. Now, in order for the Consortium to cover you, you must prove that you have requested at least 2 entities that assure you, and that you have been rejected by both.
This “emergency” insurance is regulated by Article 5 of the Compulsory Liability Insurance Regulation. Civil in the circulation of motor vehicles, which says verbatim that the agency “will accept the contracting of the risk when 2 applications for compulsory insurance by 2 insurers have not been accepted or rejected, unless the risk was accepted by another or other insurers at the request of the Compensation Consortium of Insurance. ”
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The Consortium does not offer the same coverages as a private insurer since it only provides you with compulsory insurance with the minimum essential coverages. So if your vehicle is stolen, the moons are broken, you lose the points of your driver’s license or you will suffer damages in an accident with the car, among other things, you will not be responsible.
Expensive prices for young people
The reason for companies to increase Car insurance prices for young and new people is that you are part of a group with a higher accident rate. The insurance premium is set depending on the profile of the driver and the car. Therefore, if you are under 25 you will get a higher price than if you were older.
It is possible that your driving instructor told you that you were driving very well, but you have to admit that you are more likely to have an accident than someone who has been driving for years. In this driving “experience is a grade”, and young people, along with those who have no experience, have a higher accident rate not only for the lack of practice but also for the imprudence associated with the first years in which a person gets behind the wheel.
Factors that make Car Insurance more expensive
Insurers set premiums depending on several factors, but 2 of them are fundamental and refer to the driver:
- Age of your driving license
The statistics indicate that the low age and lack of seniority pose a high risk of suffering a loss, which will make it either cost more than usual to hire a car insurance or not accept you in your client portfolio.
According to a study by the Mutua Madrilena Foundation on accident trends and the seriousness of the injuries caused by traffic accidents of those between 18 and 25 years old, 320,000 accidents are caused each year by them. In recent years, the number of incidents caused by people in that range has decreased, although for now, insurers do not reflect this in their prices.
In addition, there are proportionately more men who produce accidents than women, however you are of the sex that you are, there will be no difference in terms of the premium that you will have to pay, because since December 2012 there is a regulation of the European Court of Justice that prohibits making said distinction .
So insurers no longer use the sex criterion in the calculation of premium prices, and can only do so in the event that actuarial and statistical data indicate that it is an important factor when assessing the risk of the driver.
Lack of risk perception
Insurers follow a premise in fixing their premiums: the younger you are, the more likely you are to have an accident. As you increase in age, the loss ratios decrease due to the fact that your risk perception, in general, is greater.
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If you adopt reckless behavior and have an excess of confidence you will undermine your capacity to respond to unforeseen traffic situations, but if you prove to your insurer that you are a good driver you could get a better price when it comes to renewing it, although in the first hiring you get a very high price.
Car insurance for inexperienced drivers
The insurers that market this type of policy not only offer high prices to those under 26 but also to newbies. That is, regardless of age, those drivers with less than 2 years of license also suffer from the increase in their car insurance.
This produces a logical relationship, those who have more seniority as drivers pay less than novices. And if together the 2 things the conclusion is simple: if you are young and new you will find it more difficult to find insurance, and when you get it the price will be significantly higher.
Pony or herd of horses?
Accept it, you are not born learned, so you will not drive like an expert from the first day, simply because you have not had time to become one. Do you love speed and want to feel the power in your feet? The union of inexperience and speed can play a trick on you and end in a sinister, with the consequent rise in the price of your insurance in the next renewal.
Also, if your car has many horses, the price of your insurance will notice (regardless of whether you are young or not). That is, the more displacement your car has, the more expensive it is for insurance, an extra cost that is added to the one that you have in and of itself because you are a new driver.
Some drivers are more skilled and others more clumsy, however, the statistics are in terms of prices, so that when you buy the first car, whether new or second hand, do not launch a “supercar” or a large car if you do not want to pay too much in your car insurance.
If for the first few years you opt for a common vehicle and you prove that you are a good driver without taking losses your insurer will grant you bonuses that will lower the policy while you get seniority. After a few years, you can secure a big car in your name without getting a big hole in your pocket.
Do you guarantee All Risk, Third Party …?
If you are young and you are looking for a Car insurance, you should bear in mind that the type of insurance you choose will also influence the amount of the premium. You will be able to choose between all the modalities: a Third Party, Third Party Extended, All Risk or All Risk with the franchise.
To do this, you must analyze what needs you will have with your vehicle and adapt the coverage to them :
- If you want your insurance to cover all the mishaps that may arise, the All-Risk insurance may be a good option, although you should bear in mind that these policies are always more expensive because they contemplate many more coverages. At your highest cost, you must add that you will be offered an even higher price because you are young.
- Another option is to take out an All Risk insurance with the franchise. This type of insurance suits you if your car is new or very valuable and you want it to have a cheaper price. It will not automatically cover all the damages that occasions with it, because for the Own Damages, among others, you will have a franchise.
- On the other hand, a third party insurance is the cheapest, so even taking into account the extra costs for wanting a car insurance for a young person you will get a good price, as far as possible. If you want to include breakage of moons, fire or theft, among other coverages, you can opt for a Terceros Ampliado insurance.
Do you need to be the second driver to pay less for insurance?
A commonly known practice is that when, for example, the child takes out his driving license and buys a car in the insurance that is hired, he does not appear as a policyholder, although in reality, he will be the only one who uses the vehicle.
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Some young drivers hire their car insurance as occasional drivers so that insurers can assess the owner’s seniority, a family member for example, and their card years. However, you should bear in mind that although in principle it may seem the best option because it helps you get a much cheaper price, in the long run, it can be the worst.
If since you get the card at age 18 until you turn 26 you remain as an occasional driver and not as an insurance policyholder when you are going to hire one as a starter you will start at 0. That is, you will not have seniority. While if you start as a taker when you reach that age you will already have 8 years old and a better price.
It is possible that the first year gives you the feeling that you are paying “the inadvertent”, but in the long run you will be profitable, and if little by little you show your insurer that you have no losses you will lower the price.
What happens if it’s not your own car?
More than 80% of drivers between 18 and 25 years old registered in insurance policies do not own the vehicle they normally drive, according to the Mutua Madrilena Foundation study. If you are going to drive every day you must have insurance that covers you, but what if it is not your car and you are just going to drive your parents’ a couple of days a week?
Regardless of whether it is yours or of a family member or friend, you must be covered by the insurance of the car you are going to drive. Therefore, in this case, it is best to call the insurer and communicate that you will be the second driver of the vehicle. In this way, you will be covered in front of an accident and you will be able to drive calmly.
Tips to find the best Car insurance for young people
As we have seen, and you can check yourself if you call a few insurers, young people find yourself with many barriers when it comes to hiring a car insurance. From the beginning, the search is difficult, since not all insurers will open the doors to ensure your risks.
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But once you find one that does, you will see how the price is vertigo compared to the one obtained by those who already have more years in their driving license (experience), as well as identity (more than 26 years). However, at high prices, it is possible to reduce it. We give you some tips to get a cheap car insurance for young people without giving up necessary coverages.
- Young people between 18 and 25 years old drive quite new vehicles, since 54% of these cars are less than 5 years old, according to Mutua Madrileña. If you also add sex to age, men usually opt for compact cars, which are more expensive and powerful, while women opt for utilitarian. Taking into account this factor, it is possible that a woman of that age group obtains a better price for her car insurance, but it will not be due to her gender, but to the chosen car. The price of a vehicle’s policy depends on the driver, but also on the car. Since a new car, with a lot of equipment and power is more expensive to insure, for your first years of card it is advisable to opt for a more “basic” one. Because you have no experience, you will not be able to opt for a lower price for being a good driver, so that of the 2 factors that influence you must “play” with the vehicle.
- When buying the car pay attention to the power it has. A young person driving a high-powered car increases the risk of loss, according to statistics, so it can be a determining factor for insurers to reject you or offer you prohibitive prices.The lack of experience means that your reflexes are not 100% and that in the case of an eventuality you may not know how to act, keep this in mind when buying a car, whether new or second hand. For security, you will not be able to take full advantage of the power offered by your vehicle, so if you opt for a car with fewer horses you can enjoy the road as well and lower the premium you pay for car insurance.
- If the chosen car is diesel or gasoline it also influences the price. The cost of fuel, maintenance and the price of buying a vehicle from one engine or another can be decisive when choosing between one or the other, but it also directly influences insurance. Normally ensuring a diesel car is somewhat more expensive than gasoline, although it depends on the insurer.
- Do not go with nonsense and wait to tuner the car a few years, you can raise the price even more.
- If you are a good or bad driver it is reflected in the premium you pay, so during the first year it shows your insurer that you have no losses and in the renewal, they will reduce the bonus with bonuses.
- Opt for specific car insurance for young people. Some insurers, such as Generali and Mapfre, offer young people between 18 and 30 years old the option of contracting ” pay as I go ” products” It is a Car insurance for young people that offer to pay a premium depending on the responsibility you show against the wheel. They make you a personalized budget according to the way you drive.The insurer installs in your car a device that controls various driving variables, such as the path you travel, the speed, the time you use it and the incidents you may have. If you show good behavior you will be rewarded with bonuses and adjust the price of the policy to your specific characteristics. These products can help you save, but beware, if you are not a responsible driver you can lose out.
- When you use the vehicle it also influences. If you do not use it during the weekend and rest in the garage, you can get discounts.
- Hire insurance with franchises. The most direct way to lower your premium is to hire with a franchise. You will be responsible for part of the expenses if you cause a loss, but if you are a good driver you can get a competitive price so that the high premium for being young is not so noticeable.
- You can also accept offers from insurers in which if you sign up for more than one insurance they will give you interesting discounts.
Compare Car insurance before choosing
Getting cheap car insurance with the coverages you need when you are young is difficult, however, if you compare you can get it. To find it you will need to ask for a quote from all insurers, and with Rastreator.com this process becomes easier. If you compare Car Insurance with Rastreator you can check policies according to their price, conditions, and coverages, so you can choose at a glance.