Auto Insurance for New Drivers: What to Expect and How to Get Started

Getting a driver’s license for the first time is a major milestone, but it also comes with the responsibility of securing auto insurance. Navigating the world of car insurance and understanding all of the coverages and conditions can be a really big task for new drivers. This guide breaks down what to expect and how to get started with confidence.

What New Drivers Can Expect

1. Higher Premiums

New drivers start with a blank canvas of experience and haven’t yet built up a driving or insurance history. Because of this, any insurance protections they buy or have added to an existing policy may have a higher price tag attached initially. The good news? These rates aren’t permanent, and with more time behind the wheel, while maintaining a clean driving record, the premiums sometimes decrease significantly.

2. Impact of Driving School

Completing a Ministry-approved driver training program when learning to drive can significantly reduce insurance costs out of the gate. It demonstrates a commitment to learning about safe, defensive driving and has been proven to reduce the incidence of accidents and infractions in the first few years on the road. This bumps up the starting driver record and decreases rates.

3. Options for Coverage

A new driver can either:

• Be added to a parent’s or experienced driver’s policy – “Occasional Driver” premiums are more affordable for new drivers. However, the cost is still going to make the policy more expensive per month. Getting some quotes for adding a driver is generally recommended as soon as someone is considering getting a license for the first time. One of our Osic insurance broker team members would be happy to work up some estimates just to give an idea of the overall costs likely to be added.
• Also, it is important to note that insurance companies rate households based on the number of vehicles and drivers. Purchasing or already owning an “extra” car with a new driver in the house will require them to become a primary operator, and this can come with a significant price tag, regardless of the value of the extra car.
• A new driver gets a car —While it can be very exciting or necessary for a new driver to have their own daily-use vehicle, researching the costs beyond the price of owning a car itself is always recommended. This will be more expensive than being added as an occasional driver.
• As brokers, we see every scenario under the sun, and so often, we see families that get a car for a new driver without calling to check on the insurance costs. Sometimes, grandparents are downsizing their second vehicle, and sometimes, a family might find a great deal on a pre-owned car, but very often, they forget to call and inquire about insurance rates before they’ve committed to a vehicle purchase. Getting all of the costs and prices ahead of signing any deals is always highly recommended.

How to Get Started

• Pass the test! Once a new driver has successfully passed the G1 test, they should be added as an occasional driver to someone’s policy. There is no change in insurance premiums at the G1 level since they are not able to drive on their own yet, but this builds up the insurance experience right off the bat.

• Level Up: Once they have successfully passed their G2 test, contact an insurance broker and change their status. This is where the real driver experience begins, with an attached cost. It is not recommended for a new driver to be out driving anyone’s vehicle until they have been officially added to an insurance policy.

• Keep it Going! There can be discounts when going from G1 to G2 and then from G2 to G licensed, so it’s best for a person going through this journey to try to complete the full process rather quickly. Some people get the G2 license and get comfortable and forget about or delay the final step for various reasons. We recommend that for the best discount and rating, going through more swiftly all the way to the G license status is best.

Tips to Keep Premiums Low

• Complete a ministry of transportation-approved driving school
• Maintain a clean driving record
• Avoid unnecessary claims
• Reassess your policy annually
• Consider increasing your deductible to lower your premium

Auto insurance might seem like a hurdle, with all of the new terminology and trying to learn about coverages and protection while also being new behind the wheel. But learning about your insurance is an important part of becoming a responsible driver. With the right knowledge and preparation, new drivers can find coverage that’s both affordable and comprehensive. Contact a broker at The Ostic Group for guidance on the right protection and ways to save.