We’re not just talking about the buying cost of a new or even used car – but the costs that go along with owning one – and this is especially important for young drivers and their car insurance. When you’re insuring your car you should always think about the costs first.Everybody can rush in and buy any old car. The most important task is actually to think about the choice of vehicle and how that could affect how much you pay for your car insurance.
Here at moo-ootoblog we recommend possibly getting a quote for the car you want before you buy. By doing this you are effectively preparing yourself for the cost of insuring your vehicle and it won’t be such a shock when you go to buy it.
The best options for new drivers is to look at vehicles that have relatively smaller engine size (i.e. 1.0 – 1.2). The Ford KA or Vauxhall Corsa are a perfect pick for ensuring you won’t pay a considerably higher price for your insurance.
In addition it is worth looking at a telematics (black box) insurance policy designed specifically for young people – such as iKube. By doing this you could lessen the impact on your wallet greatly. To find out more about how this works check out our guide to telematics car insurance.
Insurance companies, including brokers out there offer many ways to pay for your insurance. You can do monthly payments, where you pay the cost of your cover in instalments.
Besides the fact that this maybe the most preferred method for a lot of people it has its downsides. One major setback is that you actually incur interest on top of the premium so you end up paying a bit more than you would if you paid off the full amount straight-away.
The full amount payment method is a bit troublesome especially for young drivers who pay their own bills. But looking on the long run you will most definitively save more money on your insurance by going for this option.
While “captive agents” sell policies from only one insurance company (think of an agent working in a State Farm office), “independent agents” represent several insurance carriers. While independent agents make it easy to compare quotes from multiple companies, they’re not always objective. An agent might steer you toward a certain insurance company because he knows he will receive a higher commission or needs to sell more of that product to keep a certain insurer happy.
Independent agents can be helpful, but “regulators have not imposed suitability or lowest cost requirements” on them, J. Robert Hunter, the Consumer Federation of America’s insurance director, told a U.S. House of Representatives subcommittee on insurance regulation in 2007. That allows them to possibly “place the consumer into a higher priced insurer with a bigger commission rate.”
In New York, under Regulation 194, an insurance agent must tell you he’s being compensated for the sale, and must tell you his commission amount if you ask.
If you ever considered fronting your car then you should avoid doing so at all costs. Fronting your car is really not worth it and could lead to a whole load of problems especially if you are a young driver. The basic principles of fronting mean that an older driver most commonly a parent will be the main driver and you will actually be the secondary driver. This in the end will get you a cheaper car insurance premium, but the problem occurs when the young driver is the main user.
This can lead to an invalid insurance which will leave you uninsured and driving as such is against the law and could lead to a penalty. In addition it is also a risk if the young driver gets into an accident as it would effectively expose the policyholder to possibly having to meet the cost of the claim as well as prosecution.