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Student car insurance guide

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Whether you are taking your car to university or leaving it parked on your parents’ drive, it’s important to make sure you have the right car insurance. But with money likely to be tight, you don’t want to spend any more than necessary. Find out what type of cover you need and how you can keep costs down with our comprehensive guide to student car insurance.

What is student car insurance and do I need it?

Don’t let the name student car insurance confuse you; it’s just an ordinary car insurance policy that is bought by students. However, while policies might not be specifically aimed at students, you might find there are ways to tailor your cover and make sure it properly suits your needs while you’re studying.

Car insurance for students can be expensive, but while there might be plenty of things you would rather spend your money on, it’s essential your car remains insured – whether it comes to university with you or stays at home and only gets driven during school holidays.

Driving on UK roads without a minimum level of car insurance is a criminal offence; get caught and you will end up with a fixed penalty of £300 and six points on your driving licence. In a worst-case scenario and your case went to court, you could be disqualified from driving and be stung with an unlimited fine.

If you already have car insurance, you don’t need to switch it when you go to university. However, you will need to tell your insurer you are going to be a student and give them your new address if you will be living away from home.


If you aren’t going to be driving your car while you are at university, you might be tempted to cancel your car insurance. However, the only way you can legally avoid insuring (and taxing) your car is to declare it off-road with a statutory off road notification (SORN)


However, this will mean you will not be able to drive your car at all – even when you are home during the holidays. To drive it legally, you would need to tax it again and arrange insurance – not necessarily something you would want to do every time you came home.


It is also important to be aware that once you have cancelled your student car insurance, it would no longer be covered if it was stolen, vandalised or damaged by fire.

Types of student car insurance

Students have the choice of three different levels of cover when they buy car insurance. These are: 

  • Third-party only: This is the minimum level of cover that is legally required to drive on UK roads – it  will only provide cover if you damage somebody else’s car or property in an accident, or if other people are injured. It doesn’t include any cover for you, or your car
  • Third-party fire and theft: Going a step further, third-party fire and theft will also pay out if your car is stolen or damaged by fire
  • Fully comprehensive: This is the highest level of cover you can buy. In addition to covering everything mentioned so far, it will also pay for repairs to your car after an accident, even if you were at fault

As third-party offers the lowest level of cover, lots of drivers think it will be the cheapest option. However, this is often not the case. Third-party cover often attracts higher risk drivers, which means it can end up costing more than you would expect. This means that for most drivers, fully comprehensive is actually the cheapest type of car insurance.

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Why is student car insurance more expensive?

The main reason students pay so much for their car insurance is that they are likely to be young and, according to the latest data from price comparison services, drivers under the age of 20 can now expect to pay in the region of £2,000 a year to insure their car. That compares to an average cost of just £413 for a 69-year old driver.

Young drivers (usually considered to be aged 17-25) pay the most for their car insurance because the combination of their youth and inexperience behind the wheel means they are more likely to have an accident.

According to the road safety charity Brake, one in five drivers crashes their car within a year of passing their test, while more than 1,500 young drivers are killed or seriously injured on the roads each year.

However, it’s not only your age that matters. Your choice of university and new address could also drive up the cost of your student car insurance. For example, if you are going to be living in a large city with above average crime rates, or will need to park your car on the street, you may end up paying more for your car insurance than you would at home.

How to get cheap car insurance for students

Although the cost of student car insurance can be eye-watering, there are plenty of ways to cut the cost

Shop around

It’s possible to save hundreds of pounds each year by shopping around for the cheapest car insurance quotes with a price comparison service. All you need to do is spend a few minutes answering questions about you and your car and it will scour the market for you. It’s important to compare quotes properly, though, to ensure you are getting the level of cover you need.

Choose the right car

The make and model of your car has a big impact on the cost of your insurance. So, if you want to keep costs down, it’s worth choosing a car that is cheap to insure. Insurance companies put cars into insurance groups numbered from one to 50, with a car in group one the cheapest to insure and a car that is in group 50 the most expensive. As a general rule, compact runarounds with small engines are the cheapest cars to insure.

Pay annually

Most car insurers will now give you the option to pay monthly. However, while this might be helpful from a budgeting point of view, it is cheaper to pay for the full year upfront if you can. This is because insurance companies normally add an interest charge for customers who pay monthly.

Increase your excess

All car insurers will charge a compulsory excess, which is the amount you need to pay towards the cost of a claim. You can often choose to increase this excess in return for a lower premium. However, if you are on a tight budget, it’s important you don’t increase it to such an extent that you couldn’t afford to claim on your student car insurance.

Improve your car’s security

You can sometimes get cheaper car insurance by making your car harder to steal, for example by fitting an industry-approved alarm. However, before investing in any security, you should always talk to your insurer to find out whether it will be worth the cost.

Add an experienced driver to your policy

Car insurers will normally allow you to add up to three named drivers to your policy. These are people you have chosen who will be insured to drive your car, in addition to you. Young drivers can often get cheaper car insurance by adding more experienced drivers – such as their parents – to the policy. However, you must drive the car the most as the main policyholder. Lying about this is called fronting and is a form of insurance fraud.

Be realistic about your annual mileage

When you apply for car insurance you will be asked to estimate your annual mileage, but the bigger the mileage you ask for, the more your insurance will cost. This means it’s important to think about how much you will actually use your car. 

If you’re regularly driving up and down the country at weekends, you might merit a bigger annual mileage, but if you are only running you and your housemates to the supermarket each week, or your car is spending term-time on your parents’ drive, you can probably save money by reducing it right down.

You can find out how many miles you have racked up in previous years by checking your MOT history online.

Choose a lower level of cover

Choosing third-party only cover might not save you any money and could mean you need to pay for your car’s repairs if you have an accident. However, some insurance companies offer stripped down or ‘entry level’ comprehensive car insurance policies that offer a lower level of comprehensive cover in return for a cheaper premium.

This can be a helpful way of cutting the cost of your student car insurance, but it’s important to check the cover or benefits you are giving up first to ensure you’re happy with a pared-back policy.

Consider black box insurance

Telematic or black box insurance policies involve fitting a device to your car that monitors how and when you drive. It then uses this information to give you a bespoke car insurance quote. So long as you drive carefully and don’t do too much night time driving, this can be a great way of cutting the cost of your student car insurance. However, if your driving is a bit haphazard or you regularly drive on nights out, you could end up paying more.

Think about pay-as-you-go insurance

If you are leaving your car at home and only driving it during the holidays, it might be worth considering pay-as-you-go, or pay-per-mile, car insurance. These policies offer comprehensive cover but work differently to standard annual insurance policies. Rather than basing your premium on an estimated annual mileage, they use a device in your car that tracks your mileage and charges you each month based on the distance you have driven. You’ll also pay a base rate to cover your car while it’s parked and not being used.

If you are only using your car occasionally, but don’t want to sell your car, this can be a sensible way to cut the cost of your student car insurance. However, the risk is that you end up paying more for your insurance if you use your car more often than you anticipated.

Some black box policies also work on a pay-as-you-go basis.

Add your car to your parents’ policy

You might also be able to save money by adding your car to your parents’ policy. Many insurers offer multi-car insurance policies, which offer discounts of around 10 per cent for each additional car you insure with them. However, if your car is going to university with you, it’s important to check the policy will cover cars kept at different addresses, as not all will.

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Frequently asked questions about student car insurance

Although students get discounts at lots of places like in shops and restaurants or on the train, you are unlikely to find a car insurance student discount. That isn’t to say students can’t save money on their car insurance though.

When you buy student car insurance, you will need to give your insurer an address. Although you might be tempted to use your home address, it’s important to use the address where you will be spending the most time. For the majority of students, this is likely to be their university accommodation or off-campus flat.

Adding a more experienced named driver – such as a parent – to your car insurance policy is a common way for students to reduce the cost of their cover. However, falsely claiming that a parent is the main driver of the car to cut costs even further is a form of insurance fraud known as fronting. If you submit a claim and the insurer suspects fronting has happened, it may refuse to pay out and invalidate your cover. You could also be prosecuted for fraud and get a criminal record.

Yes. If you drive your parents’ or a sibling’s car when you are home for the holidays, it may make sense to arrange short-term or temporary car insurance as and when you need it. 

Temporary student car insurance can be arranged in minutes and is often available from one hour to 28 days at a time. This may make more sense than asking family members to add you as a named driver to their policy, which could boost their costs substantially (if you are a young driver with limited experience). Taking out a separate, temporary policy for yourself also means they won’t lose their no-claims discount if you need to make a claim.

Whether you need car insurance when you are learning to drive depends on how you are taking lessons. If you are learning with a professional instructor in their car, insurance should be included in the cost of your lesson. However, if a friend or family member is teaching you, or letting you practice in their car, you will either need to arrange your own learner driver insurance or ask them to add you as a named driver on their policy.

If you already have car insurance, you will need to let your insurer know about any changes to your circumstances that could affect the price of your insurance. This would include moving to a new address and changing your profession to student.

When you go away to university, your car insurance costs may go up. This is particularly likely if you are moving from a rural or suburban area to a major town or city with a higher crime rate. You may also need to pay more for your insurance if you don’t have access to off-street parking at your new place and need to park your car on the road overnight.

Molly Dyson


After growing up with a passion for writing, Molly studied journalism and creative writing at university in her home country of the United States.

She has written for a variety of print and online publications, from small town newspapers to international magazines. Most of her 10-year career since relocating to the UK has been spent in business journalism, writing and editing for admin professionals at PA Life magazine and business travel managers at Business Travel News Europe and representing those titles at conferences around the world.

Now an Editor at the Independent Advisor, Molly is an expert in a broad range of consumer topics, that include solar panels and renewables, home improvements and home insurance, and consumer technology such as home security and VPNs.

In her free time, Molly can usually be found exploring the outdoors with her husband and their young son or gardening.