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Young drivers pay the highest insurance rates of any demographic in Australia, and the younger you are the more you’ll pay for insurance.
If you want to significantly reduce the amount you pay for insurance, your options are quite limited.
These include:
If none of the above appeal to you, then you’re left with one option, which is to shop around for the best car insurance companies for under 25s in your state or territory.
Before you can decide who is the best car insurance company for young drivers in your state, it’s worth understanding what your insurance options are.
CTP insurance, known as green slip insurance to New South Welshmen, is a legal requirement in Australia.
This covers expenses arising from physical injuries resulting from any car accident you are involved in.
Most states make it very easy to get CTP insurance, as it is normally covered in your car registration fees.
In Queensland and New South Wales you can shop around for providers.
Most drivers want more cover than CTP insurance provides because accidents cause damage to property, which you may have to pay for out of your own pocket if you don’t have insurance cover.
Third party property insurance covers you in the event you damage someone else’s car or property in an accident, and is generally the minimum level of insurance you want to drive around with.
Third party property, theft and fire insurance, covers you for third party claims, and provides limited protection for your own car.
Apart from cover for any third party claims, you’ll have cover if your car is stolen or fire damaged.
However, if your car is accident damaged you’re on your own.
Comprehensive insurance is the best car insurance option for young drivers.
This protects you against third party claims as well as theft and accident damage to your car.
You’ll also get some other useful cover thrown in, like windscreen replacement and hail damage.
| Type of insurance | Damage to your car | Theft of your car or fire damage | Damage to 3rd party property | 3rd party injury or death |
|---|---|---|---|---|
| Compulsory Third Party (CTP) | X | X | X | ✓ |
| Third party property | X | X | ✓ | ✓ |
| Third party property, fire & theft | X | ✓ | ✓ | ✓ |
| Comprehensive | ✓ | ✓ | ✓ | ✓ |
The biggest challenge facing young drivers is that most insurers do not take into account how well their clients drive when providing them with insurance quotes.
Instead young drivers are hit with high insurance rates by default just because they are members of a demographic that is at higher risk of having an accident.
With this in mind, the best car insurance companies for young drivers are those that treat young drivers as individuals, and take their driving behaviour into account when providing them with insurance quotes.
The only insurers who are currently able to do this are telematics insurance companies.
Telematics insurance is a form of car insurance that uses telematics technology to build up a very accurate profile of a person’s driving skills.
This form of insurance requires the insured person to have a telematics enabled device with them while they are driving.
This can be a telematics black box unit installed in the car, or a telematics app that transforms a smartphone into a powerful telematics unit.
This unit then tracks critical information while the person is driving, building up a highly accurate picture of their driving skills.
Armed with this, telematics insurers can more accurately gauge how much risk an individual is of having an accident, and reward good drivers with discounted insurance rates.
Technology allows telematics insurers like UbiCar to offer fairer insurance rates than traditional insurers.
*Savings are factual and based on comparison between the customer’s current Comprehensive Car Insurance policy with UbiCar as of December 2018 and their policy with their previous insurer. Premiums and savings may differ depending on individual circumstance.
