Young drivers head to the Bank of Mum and Dad - Car insurance - News - Moneyfacts


Young drivers head to the Bank of Mum and Dad

Young drivers head to the Bank of Mum and Dad

Category: Car insurance

Updated: 23/05/2014
First Published: 23/05/2014

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

An increasing number of younger drivers are turning to the Bank of Mum and Dad to buy their first car, according to research from Co-operative Insurance, with 27% admitting that their parents paid for it.

This also means, however, that many younger drivers are steering clear of old bangers and have increasingly sophisticated tastes, with the most popular first car in Britain being a Ford Fiesta – ideally black – typically costing £2,119.

That makes it, on average, £1,225 more expensive than their parent's first car, unsurprising when the majority of over-55s had to buy it themselves with just 1 in 10 having received help from their own parents.

Happily though, the input of parents means fewer younger drivers are having to turn to credit to pay for their first car – just 4% of those surveyed paid with a loan or credit card, compared to 9% in the generation older – but it might also be leading to a bit of complacency, with 43% of younger drivers actually saving up to buy their first car, compared to 47% of their parents.

It just shows how much help parents are providing, but what they won't be able to do is help with the cost of car insurance. The overall price will of course be dictated by the insurance company but, happily, not all younger drivers face the excess costs typically associated with this age group.

Telematics schemes, where so-called black boxes are fitted to the vehicle to monitor driving behaviour, can result in much cheaper premiums where the price is based on how an individual actually drives rather than the typical driving behaviour of their age group.

It can be much safer too, with Co-operative revealing that customers with these boxes fitted are 20% less likely to be involved in an accident than those with standard insurance. This can, in turn, bring premiums down even further and can add to a no-claims bonus, so being a younger driver doesn't necessarily mean everyone's tarnished with the same brush.

Whether or not you're relying on the bank of Mum and Dad or are going it alone, the key to keeping your costs in check all comes down to having suitable insurance. Make sure to compare the options to find the best deal to suit your needs, and then get ready to drive away in your brand new Fiesta…

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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