Why does car insurance cost so much for young drivers?

Female driver parking.

Published 9 April 2021
Last updated 12 April 2021

The cost of car insurance for young drivers. We explain how insurers work out their prices, and give tips to help lower the cost of your insurance.

How much?!

If you’re a new driver under the age of 25, you can expect your car insurance to be pretty pricey. Let’s assume that you’ve just passed your driving test, having already spent a hefty sum on your lessons. You’ve put some money aside to buy your first car, only to find that a big chunk of your savings now has to be spent on insurance. It can come as quite a shock. Your insurance may even be more expensive than your car!

What are the odds?

It may seem unfair, but the fact is that insurance companies have to take into consideration the risk presented by each category of driver. Insurance companies are very much like the bookies who take bets on the outcome of horse races, football matches or reality shows. They base their odds on probability: which horse has won its recent races, who’s been playing well, who’s really popular and talented? All of these things tell the bookies how likely it is that a particular horse, team or contestant will triumph.

Car insurance companies set their odds on who is most likely to crash. This is based on how certain groups have performed or behaved in the past, and the sad truth is that, if you’re under 25, you’re more likely to be involved in an accident than someone who’s over 25. It’s a statistic that cannot be denied, and one that – from a business point of view – the insurance companies would be mad to overlook.


Having dealt with young adults all of my working life, and in my family life, I know how ineffective ‘the lecture’ is. Nobody wants to be talked down to in an ‘I-know-better-than-you-sonny-boy’ tone of voice. But I cannot change facts and I cannot change science – and science is what the ‘risk factor’ in young people often boils down to.

There’s a part of our brains called the pre-frontal cortex (PFC) and it is not fully developed until we reach the age of about 25. The PFC is an important part of the brain when it comes to driving, because this area deals with judgement around risk taking. Until this part of your brain is fully developed, you’re going to have to think much harder about how to deal with hazards, as the safest course of action will not necessarily come to you automatically.

Personal growth

Think of my advice like this: if I’m taller than someone because they’ve not yet reached their full height, I’m more likely to be able to reach the top shelf of a cupboard than they are. If I said ‘Let me get that for you, because you may not be able to reach it’, it would not be taken as being patronising or nagging; it would be seen as helpful. So when I say ‘Be extra careful because you’re less likely to see danger than I am’, you’ll know that this is also about personal growth. This is not another lecture from an old git, but a presentation of the facts and an opportunity to consider what you’ll do with them.

Maybe you can step back and take a look at yourself objectively – recognise where you are in your personal and physical development. Put aside your pride and ask yourself ‘Do I calculate risk? Do I take the safest course of action in hazardous situations?’ If the honest answer is no, then you may have to accept that you need to concentrate that bit harder on looking for danger than us old folk. If you do that, it’ll eventually pay off; you’ll avoid having to make an insurance claim, making your next year’s insurance premium considerably lower – and you’ll get there in one piece.

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