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Student car insurance

It is possible to find cheap car insurance while you're still at school or university.

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Car insurance can be costly on a student's budget. But that doesn't need to be the case. While there's no specific type of student car insurance available, there are ways to keep things affordable, from the car you drive to specialist telematics policies.

Does being a student affect my car insurance?

You don't necessarily pay more because you're a student – it's more because of how old you are. Students are likely to pay more than others for their car insurance often because they are younger. If you are under 25, you are considered a young driver by insurers.

However, age isn't the only factor in calculating your premiums. Factors such as driving experience, where you keep your car and the type of car you own will also impact the price of your student car insurance.

If none of this applies to you, you might be able to get cheap student car insurance. Otherwise, it's likely to cost you a little more.

Do insurance companies ask if you're a student?

Yes. Insurance companies require that you list your occupation, so you'll have to let the insurer know that you are a student.

It might be tempting to change your occupation or address on your application in the hope of receiving lower premiums, but honesty is the best policy. Not only is it considered fraud to lie, but your claim will probably be denied if you don't tell the truth.

If you live and keep your car in an area with low crime, are over 25 and have some driving experience, you might not need to worry about paying more for your student car insurance. For example, a quote for a 30-year-old male with Budget Direct's Comprehensive Car Insurance policy was $78.50 a month. By comparison, a 21-year-old male, driving the same car, received a quote of $110.13* a month.

*Based on a quote for a 30-year-old male with 5 years No Claims Discount and a 21-year-old male, driving a 2015 Mazda 2, with a comprehensive Budget Direct policy.

Are there any specific policies dedicated to students?

Insurers calculate premiums based on assumptions. Unfortunately, that means young drivers are likely to face higher premiums because they're statistically more likely to be in an accident.

To avoid a higher premium, telematics policies are a good place to start. While there are no specific policies dedicated to student car insurance, insurers like Ubicar tailor their policies to your driving as opposed to assumptions based on your age.

With telematics insurance products, your provider will install a device in your car and usually an app on your phone. The device monitors your driving habits, from how fast you drive to how well you take turns. The safer you drive, the more you are rewarded, often with lower monthly premiums.

Does being on my Ls or Ps affect the cost of insurance?

Yes. L-plate and P-plate drivers fall into a high-risk group, which means you'll typically pay more for your car insurance. However, some car insurers don't require learner drivers to be listed on an existing car insurance policy (for example, a parent's) at all, so you might not have to pay higher premiums whilst you learn. You should always check with your insurer beforehand to see if this is the case.

If you are a P-plater, you can sometimes remain under your parent's car insurance policy as long as you are under the age of 25.

Keep in mind though that if you have comprehensive car insurance, you may have to pay an additional excess for claims if you have an accident while driving. These can include:

  • Learner driver excess. An excess may be charged for claims where your car is being driven by a learner.
  • Young driver excess. An excess that is charged for claims involving a driver who is under 25.
  • Inexperienced driver excess. An excess may be charged for a driver if they haven't held their licence for a specific period of time.
  • Undeclared driver excess. Some insurers charge an additional excess if you decide not to list a learner driver under your policy.

If you are over 25, you're likely to pay a little less. However, if you have to list them on your policy, anyone with Ls or Ps is classed as an inexperienced driver, meaning they will pay more than average for their car insurance. For instance, if you add someone under the age of 18 to a 30-year-old's Budget Direct's Comprehensive Car Insurance policy, the price goes from $82.26 to $154.91* a month.

*Based on a quote for a 30-year-old male with 5 years NCD and a 17-year-old male, driving a 2015 Mazda 2, with a comprehensive Budget Direct policy.

Which car insurance is best for students?

Finding the best price for car insurance for students depends on a number of factors, including:

  • The car you are driving. It will cost you more to insure a high-performance car, as they're much faster, so are considered riskier to drive. They're also more likely to get stolen, which puts the premiums up. It's the same story with modified cars that have expensive features and enhanced performance.
  • The cost of your car. If you're a student, you're most likely on a budget. That means you want something affordable and cheap to run. Generally speaking, older cars are cheaper to buy, insure and repair if something goes wrong. However, they can sometimes prove troublesome so it's all about finding the right one.
  • The level of cover you want. Comprehensive car insurance is the safest option, covering both your car and anything you might accidentally crash into. It's also the only type of car insurance policy that properly covers you if your car is damaged in an accident. For those on a budget, third party property damage (TPPD) car insurance covers damage you cause to someone else's vehicle or property.
  • Shopping around. Good student car insurance rates are much harder to come by so it's definitely worth shopping around. Don't settle for the first or easiest option. As already suggested, black box car insurance (telematics) is a good alternative for young, safe drivers.

Compare comprehensive car insurance

Name Product Roadside Assistance Accidental Damage Storm Choice of Repairer Agreed or Market Value
Budget Direct Comprehensive
Optional
Optional
Agreed or Market
Finder's summary: Awarded the 2019 Finder Award for the Best Value Car Insurance, this policy offers solid coverage at a low cost. Budget Direct’s claims service has received a 4.2/5 based on nearly 5,000 customer reviews.

Who it might be good for: People who want a comprehensive policy without breaking the bank.
Bingle Comprehensive
Market
Finder's summary: Bingle consistently come up as one of the cheaper insurers out there. They only cover the basics, so you don't get to choose your own repairer, you're not covered for personal items in the car and you won't get a hire car if your car is stolen. But this keeps their premiums low.

Who it might be good for: Someone who wants a low cost option that covers them for the basics.
Qantas Comprehensive
Optional
Optional
Agreed or Market
Finder's summary: You'll be able to pick and choose how comprehensive you want your cover to be thanks to optional extras like roadside assistance, choice of your own repairer, and the option of agreed or market value. Plus, you'll earn Qantas Points when you join and get access to the Qantas Wellness App.

Who it might be good for: People who love collecting frequent flyer points.
Poncho Comprehensive
Agreed
Finder's summary: Poncho works like a monthly subscription - you pay monthly and can cancel and leave at anytime. You can also list multiple cars and drivers under one policy, making it ideal for families and groups living together under one household.

Who it might be good for: People who only need cover for a short period of time.
Youi Comprehensive
Optional
Agreed or Market
Finder's summary: Youi Comprehensive Car Insurance is one of the few providers to include roadside assistance in their policy. You'll also get access to YouiRewards which gives you discounts on furniture, parking and more. Youi also have a live chat feature on their site to talk through any questions.

Who it might be good for: People over 25 who want comprehensive cover with a focus on customer service.
Coles Comprehensive
Optional
Agreed or Market
Finder's summary: Coles have two-tiers of comprehensive car insurance to choose from. You'll earn double flybuys points at Coles supermarkets and you can get $10 off your Coles grocery bill every time you redeem 2,000 Flybuys points. If you're over 30, you can get roadside assistance free for a year.

Who it might be good for: Coles customers and Flybuys collectors.
Virgin Comprehensive
Optional
Optional
Agreed or Market
Finder's summary: Finalists for the 2019 Finder Awards for Best Value Car Insurance, Virgin Comprehensive provides a good level of cover for a decent price. You'll get 15% off when you buy online and get access to their hail hero service.

Who it might be good for: People who want a comprehensive policy that's affordable.
Real Comprehensive
Optional
Agreed or Market
Finder's summary: Real Comprehensive Car Insurance provides similar coverage to other insurers for the important stuff like looking after your car if it's stolen or you crash. They're also one of the few insurers who offer a Pay As You Drive policy, so you might be able to save big if you don't drive much.

Who it might be good for: Those that don't drive much can take advantage of their Pay As You Drive policy.
Kogan Comprehensive
Optional
Agreed or Market
Finder's summary: Kogan comes with all the perks that most comprehensive car insurance policies include but you'll also be entitled to some benefits on their online store. This usually comes in the form of a gift voucher or discount if you buy online. Plus, Kogan offer a pay as you drive option, which could be good if you're not on the road that much.

Who it might be good for: Kogan shoppers and those that don't drive much.
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