One of the follow-on aspects of last week’s dramatic episode is that the person involved has now had to buy a new car, which also means buying new insurance. And, because they’ve now had a claim put against their record, the cost of buying said insurance rises significantly. Fortunately, her insurance company has been reasonable, only charging her slightly more per month than was being paid originally. But nevertheless, and also partly because my own cover is due for renewal soon, this whole situation has got me thinking about car insurance, and why it’s so damn expensive.
Now I know that there are various reasons why, for a relatively young person like me, insurance can be a very expensive purchase. The insurers have to take into account the fact that I’m only 20, the fact that I’ve only been driving for just under three years, and the fact that I’m a student. All of this adds up to what can be a very expensive quote.
But here’s the thing. I’ve always thought of car insurance as being a bit like a wager, with the insurers betting that you’ll make a claim, and you going the opposite way. Fair enough. But would you like to know what my most expensive quote was? According to a well-known insurer on a well-known price comparison website, they can insure me for just £2,600. Yep, you read right. Over two thousand pounds to insure a car that, at best, is worth only £800. So what they’re saying is that they expect me to completely write the car off three times a year. Now I’m sorry, but even my driving isn’t that bad.
And don’t think that the quote is so expensive because I’m choosing to go fully comprehensive. Oh no, that mammoth quote is only to insure me for third party, fire and theft. Imagine if I’d wanted everything covered, I’d have had to sell most of my internal organs just to pay the premium.
So, for students and other types of people who are terminally short of cash, this whole situation leaves us in a bit of a proverbial pickle. Because insurance is so expensive, but is also unfortunately so necessary, which way is it best to go? Do we go for the cheapest insurance possible and hope that nothing bad happens? Or is it worth taking out the most comprehensive cover available on the off chance that you have an accident?
Like I’ve said, the whole business of insurance is really like placing a bet with yourself. The question is, how lucky do you feel?
Moss on Motoring 
I agree completely that insurance is like placing a bet with yourself. I reckon I’d have saved about 2/3 thousand over the last 4 years had I gone for 3rd party. Hindsight is a wonderful thing though!
Insurers aren’t just working out the odds of you writing off your car. But also damage you could potentially cause to other cars or people.
It would be interesting seeing what your quote would be for say, a brand new £20k car. Then you could, in theory, see how much of the cost is based on the value of your own car.
There’s an alarming trend among young asian lads around here for driving without insurance and giving false details in an accident. A while back I asked an asian ex-colleague from one of the worst areas for it how they managed to buy older but still powerful cars, or fit all those dodgy mods and still get it insured. He told me they didn’t bother with insurance because the biggest fine for getting caught without it is still less than the cheapest policy for the cars. He also said that a lot of them rely on people not questioning complicated asian names in case they’re accused of being racist and ignorant. He also said that generally the women in the families, particularly mothers, usually take the points that their sons pick up for speeding and jumping lights as well. I know of one guy who’s about to get his mother disqualified after five offences in just over a year, and she rarely drives. She even took his speed awareness course for one of them.
It’s annoying when you buy a car worth over £5k because you have to go fully comp and that can stack up. The best bet is to reach 25 years old as soon (and cleanly) as possible because then the cost tumbles. I manage to insure my Octy VRS fully comp, whilst parked on the street in an average area, for just over £400 a year. That’s with 10 years NCB though.
You know a great way for young people to reduce their premiums is to add their parents (especially mothers) to the policy as named drivers, it knocked £500 off my insurance. That is no small saving. Still fully comp was £800 for the year and that is with an accident in the last five years which is not bad.
The answer is to get a classic car! My insurance is £426 and I’ve only been driving for one year.