Guide to Car Insurance for New Drivers

If you are shopping for car insurance for new drivers in Canada, you’ve landed on the right page. We at Surex strive to help people find their perfect match for all kinds of insurance needs. 

This guide will help you understand how young driver insurance works, its coverage types and how to get cheap car insurance quotes for new drivers. So let’s get started:

How Does Car Insurance for New Drivers Work?

In Canada's vehicle insurance industry, anyone under 25 years of age is considered a ‘young driver.’ Car insurance for new drivers works the same as the standard car insurance, but the cost is usually higher for young drivers. If you are a new motorist with little to no experience on your hands; you’ll be considered a ‘high-risk’ driver. The chances of getting into an accident as a new driver are higher than someone who’s been on the roads for some years. 

However, as you add years to your driving experience with a clean track record and perfect driving laws compliance, your premium rates can go down. Most of the auto insurance policies in Canada work on a ‘no-fault’ system. This means if you get into an accident, whether you are at fault or not, you will work with your insurance company to file claims. 

Different Canadian states have different auto insurance rules, but they also share many similarities when it comes to basic auto insurance policies and coverage types. Talking to an accredited insurance advisor will help you figure out the coverage you need to get started. You may also check this article about car accident insurance claims.

How are Car Insurance Quotes for New Drivers Calculated?

A range of variables goes into calculation when determining car insurance quotes for new drivers. As someone who’s between the age of 16 and 24, you can expect a higher cost for auto insurance. But as you prove yourself as a reliable driver and escape the high-risk age bracket, the price will drastically go down.

However, don’t let the initial high prices wear down your enthusiasm; we’ve shared some valuable tips for purchasing cheap car insurance for new drivers at the end of this guide. That being said, here are a few factors that are considered when crunching numbers for car insurance cost calculation:

• Your driving record

• How frequently you use the car

• Location

• Age

• Gender

• Type of car

• Credit history

• Type of coverage you need

The average car insurance costs for states like Alberta, Ontario, and Quebec were $1,316, $1505, and $717 respectively in 2018 (Insurance Bureau of Canada). So as a new driver, you can expect to pay a few thousand bucks on top of the regular cost depending on your province.  

Young Driver Insurance Coverage Types:

There is a multitude of coverage types that you can get when purchasing young driver insurance; let’s look at a few of the most common ones:

• Liability Coverage: This one is the absolute minimum coverage you need to have as per Canada's law. It is primarily used when you are at fault in an accident. It pays for property damage as well as bodily injuries of the other party.

• Comprehensive Coverage: Despite its name, it doesn’t cover all damages to your car. Still, most damage types such as fire, hail, flood, vandalism, and theft are covered. 

• Collision Coverage Policy: In the event of an accident, this coverage pays for your vehicle’s repairs.

• Uninsured Motorist Coverage: It is not mandatory in many states of Canada. However, if you get it, you will be paid for the damages if an accident is caused by someone else’s fault even if they are not insured or underinsured. 

• Pay as You Go Coverage: This is the latest addition to the insurance coverage types where a smart tracking device, aka Black Box, is installed in your car. The device measures driving metrics like acceleration, hard turning, driving time, mileage, braking, etc. Most insurance companies use the box for 90 days, and at the end of this period, your premium is adjusted based on your driving habits. 

5 Tips for Getting Cheap Car Insurance for New Drivers:

If the rising costs for new driving insurance are stressing you out and you are losing hope of cruising around in your car without a worry in the world, then don’t fret. We have laid out some practical tips for you to get some money slashed off of your car insurance cost as a new driver. Let’s have a peek:

1. Get The Right Vehicle:

As mentioned above, car type is also a factor influencing the insurance quotes for new drivers. Getting the right car can significantly decrease your premium. Here are a few vehicle types that can reduce coverage cost:

• Subaru

• Jeep

• Toyota Tacoma

• Nissan Sentra

• Honda CR-V

• Hyundai Elantra

• Ford Explorer

Cars that cost higher to insure are usually used for off-road/race driving, increasing the accident risk. Furthermore, luxury vehicles also have higher insurance costs because of expensive repairs.

2. Get a Driving Course:

You might be an excellent driver, but insurance companies need certification to believe that. Taking a driving course from a reputable institute can help you polish your motoring skills and get you a big discount on premium cost.

3. Bundling Policies:

Combining various insurance policies is a great way to get cheap insurance for young drivers. You can bundle the auto, home, boat, or other insurance policies from the same insurance provider and get a considerable discount. Since getting various policies from one company saves them money, they pass on this markdown to you. 

4. Increasing the Deductible:

It is the amount that you pay from your pocket before the insurance company pays for anything. When purchasing a policy, you will have different thresholds of deductibles to choose from; the higher your deductible, the lower your premium.

5. Compare Quotes:

The key to getting cheap insurance for young drivers is by shopping around. You do not want to take the quote from one company as is. There is a multitude of highly reputable insurers out there that may offer better rates. 

So, use a reliable auto insurance broker to connect with top quality insurance companies in Canada and receive instant car insurance quotes for new drivers. Compare the prices and go with the one offering the lowest premiums without compromising the essential coverage types. Check also this article about insurance myths and facts.