Car insurance for P-platers: What does it cover and could you get a cheaper policy?

Passing your practical driving test and being able to drive unsupervised is a big step towards becoming independent. But before you put on your P-plates and hit the road, it’s worth thinking about your car insurance.

Even before you buy a car, there are costs to consider that might impact your insurance. Whether your car is new and flashy or old yet reliable, and if it has performance-enhancing modifications can impact your back pocket. So too can general safety features, such as whether the car has an immobiliser or tracking device, and if there’s a car alarm installed.

You also might be wondering if you’ll be covered by your parents’ car insurance, what car insurance covers for P-platers and how you could get a cheaper policy. We discuss all this below.

Are you covered under your parents’ car insurance policy?

If you’re driving your parents’ car, you may be able to be added to their car insurance policy as an additional driver. This will typically make the policy more expensive, but it may work out cheaper than taking out your own car insurance policy. Be aware that in the event of a claim, you’ll typically need to pay an additional excess if you are an under 25-year-old driver. Ask your parents and insurer whether this is an option for you.

If you are driving your own car, you may want to consider taking out your own comprehensive car insurance policy. This will generally cover you for damage to your car, as well as damage to other people’s vehicles and property.

Car insurance policies for young drivers

While Canstar does not rate car insurance policies for P-platers specifically, we do compare policies for under 25-year-old drivers.

If you’re considering taking out car insurance, the comparison table below displays some of the policies currently available on Canstar’s database for an under-25-year-old male seeking cover in NSW without cover for an extra driver under 25. Please note the table is sorted by Star Rating (highest to lowest) followed by provider name (alphabetical) and features links direct to the providers’ websites. Use Canstar’s car insurance comparison selector to view a wider range of policies.

What does car insurance cover for P-platers?

There are different types of insurance to learn more about and consider based on your budget and needs, including:

  • Compulsory Third Party (CTP) insurance: protects you if you injure or kill someone in an accident
  • Third party property damage: covers you if you cause damage to someone’s property (i.e. their car)
  • Third party fire and theft cover: covers property damage and your car if it’s damaged by fire or stolen by thieves
  • Comprehensive car insurance: the most advanced (and most expensive) form of cover

CTP insurance is legally required to register your car, and it is an included cost of vehicle registration in most states. The rules of CTP insurance can vary from state to state.

P plate insurance
Source: Vitalii Petrushenko (Shutterstock)

Comprehensive car insurance covers you if you damage another person’s car or property. It also provides coverage if your car is stolen or is damaged due to certain events such as fire, storm, flood and theft.

To benefit from this coverage, P-plater drivers will typically need to comply with provisional driver restrictions. Some car insurers may refuse to pay out your claim if the incident occurred while you were in breach of the restrictions that apply in your state or territory. For example, your insurer may not cover you if were:

  • Driving under the influence of alcohol
  • Using your mobile phone while driving
  • In breach of the peer passenger restriction. For example, in Queensland red P-platers under 25 can only carry one passenger under the age of 21 during 11pm and 5am who is not an immediate family member.

Read the terms and conditions of your policy to check what you will and won’t be covered for.

Does car insurance cost more for P-platers?

Car insurance generally costs more on average for P-platers than it does for other drivers. According to Suncorp, this is because P-platers are generally less experienced and younger than other drivers, and are typically seen as a bigger risk to insurers.

When determining the cost of your car insurance, insurers will also look at other factors, such as:

  • Your gender
  • Your claims history
  • The type of car you drive
  • The level of cover you take out
  • How far you drive your car each year
  • Where you live
  • Where you park your car (for example, whether you park in on the street or in a secure garage)

Most insurers will also add an age excess if you are under 25 years old. This means you’ll need to pay more money if you need to make a claim.

Canstar does not compare car insurance for P-platers specifically. However, to give you an idea of costs, we have looked at the cost of car insurance for under 25s and how this compares to a family car insurance policy.

How can P-platers get cheaper car insurance?

If you decide to take out your own car insurance policy, and are looking for ways to cut down costs, you could consider:

  • Keeping your car in a secure location, rather than on the street
  • Looking for discounts: many providers offer premium discounts when you buy a new policy online. Some insurers also offer multi-policy discounts and discounts if you complete a safe driving course. Find out what premium discounts are currently on offer.
  • Increasing your car insurance excess: policies with higher excesses will often have lower premiums. However, it’s important that you can afford to pay the excess amount in the event of a claim. Smart budgeting can help you prepare for the unexpected, and we’ve shared some of the saving and budgeting apps that piqued our interest in 2020.
  • Driving safely: many insurers offer no claims bonuses. This typically gives you a discount for each year that you don’t make a claim, up to a certain limit.
  • Reviewing how often you pay: Instalments can be more manageable, but if you pay for your insurance annually you may be offered a cheaper rate.
  • Consider your extras carefully: Windscreen damage protection is one example of a policy inclusion that is often optional, for a cost.

You could also potentially save on your insurance by comparing policies to find one that suits your needs and budget. You can compare a range of car insurance policies on Canstar’s database.

This article was originally published by William Jolly.

Main image source: Ben Gingell (Shutterstock)

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