There are particular insurance policies for different age groups, male and female insurance, students and first time car insurers.

As a new driver or first time car insurer, it is unlikely that a cheap policy will be issued due to the lack of history between insurer and driver and also because first time car insurance is usually underwritten for young and high risk drivers. The most expensive premiums belong to new drivers simply because of their lack of experience on the road and the increased number of claims coming from inexperienced and new drivers.

However, there are certain factors to take into consideration if you are a first time car insurer. If possible make sure that your first car is in a low risk category. For example a big-engine sports car or a highly modified car would attract higher premiums than a relatively old small-engine vehicle.

Additionally, make sure to approach an insurer that provide tailor-made policies for the first time car driver. Some insurance companies may quote a standard policy which does not take the new or first time driver into consideration and premiums may be higher. Furthermore, some insurers are even reluctant to even give new drivers a quote let alone an actual policy. Look for a bespoke insurance for your particular age and sex if you are a first time driver. The best piece of advice, as always with insurance, is to research the market in order to find the best solution.

An option which is not necessarily advised but can cut down costs to a first time insurer is to become a second or additional driver on somebody else’s policy, say a parent or brother or sister who have experience. Sharing the policy will ensure a lower premium for the new driver however it will refrain from building up a history between the driver and insurer meaning that if the new driver applied for their own insurance policy one day they will be back at stage one with a high quote and no claims bonus.

Some governments offer incentives to new drivers to help lower their first policy. For example the ‘Plus Pass’ in the UK results in cheaper car insurance once the driver has passed an advanced driving course. Similarly the US government offer lower rates should a student do particularly well academically.

The car hire company will have pre-set agreements with various insurance companies to cover their clients while hiring a vehicle. Parts of these agreements require that the client agrees to a certain level of excess payment should an accident occur. For example the policy may state that should damage to the vehicle occur then the driver is liable to the first agreed set amount anywhere between $150/£100/€120 to $3200/£2000/€2300. This is known as excess and is included in car hire insurance known as car hire excess.

This feature of the underwriter is common among vehicle rental and usually cannot be avoided. It is a condition of the rental of the vehicle. However, there are often varying levels of excess that the customer can chose from. If the excess amount is high then the premium will likely be lower, if the excess level is low then the premium price will likely be higher. It is a risk-reward ratio in insurance terms.

Many large insurance companies and insurance brokers have noticed the more strict rules governing care hire excess insurance and the cost involved to the end user should an accident occur. To appeal to care hire drivers, many third party insurers now offer lower cost policies of their own with lower excess limits to attract the drivers business away from the car hire insurance company. Not only are these policies generally cheaper, they usually cover more of the vehicles liability such as windscreens and tyres that the hire companies do not in addition to lower excess.

Third party insurance can also be bought per-hire basis or as an annual policy. The latter is beneficial as it covers a driver for any hire of any vehicle for 365 days, so is ideal if rentals are a regular occurrence over that period of time. This car hire insurance cover usually also includes worldwide cover for car hire on vacations and it extends to theft and accidents that were a third parties fault.

This type of vehicle insurance covers somebody that is partially or fully learning to drive in their own car and not an instructor’s vehicle. A general rule of thumb is that young or new drivers pay higher insurance premiums as they are higher risk than other category drivers, however with a provisional car policy, many insurers issue a discount due to the driver always having professional tuition while in the vehicle on a provisional license.

There is an additional benefit to getting covered before a full driving license has been issued with provisional car insurance as no claims bonuses begin to be accrued from the moment the policy starts. That means that once the policy is a year old, no matter whether the license of the driver is a full license or provisional and whether a driver has been active on the road or not, the next premium will likely be about 20% lower than the previous year.

Furthermore, certain insurance companies also view the fact that if a person has been learning to drive for any length of time, say two years, then this is seen as a lower risk than someone who has held a license only for a few days. The premiums for the former driver will therefore be lower than the latter.

As a safety precaution if learning to drive while under the supervision of a family member for example, provisional driving licenses often cover the tutor in the event of an emergency where the experienced driver can take over.

Insurance premiums for Under 21 year old drivers are among the highest in any age bracket in relation to their risk and this news only gets worse for male drivers in this category as their insurance is higher than that of a female of the same age. Once again due to being higher risk.

Newly qualified drivers are more likely to have an accident and make an insurance claim within their first year driving than at any other time and this fact goes against young driver’s premiums. In addition under 21 year old drivers are in 15% of all road deaths and young drivers account for around 10% of license holders, yet are involved in about 29% of road accidents.

Insurance companies do not offer temporary insurance for the under 21 category (and often not under 24) under a month in duration. Drivers over the age of 24 are able to obtain cover for as little as 24 hours, however Under 21’s are exempt from this privilege.

An alternative option for the Under 21 driver could be that they become a named driver of another person’s insurance policy that has experience and ideally is female with no claim history. This will ensure full cover for the Under 21 driver however the premium will be much lower than that of their own and cover will likely be comprehensive. The only real disadvantage of this set up is that the named second driver does not accrue any no-claims bonus from the insurer. Only the policy holder is entitled to that. Please be aware thought that not all insurance companies offer this alternative and you may struggle to be named on another policy if under the age of 21.

To lower the premium paid by under 21 drivers there are certain options available. Firstly, you can opt to pay a higher excess in case of an accident. This means that you will cover a higher part of the repair cost should there be an accident, however if there is no accident the excess will obviously not need be paid and the premium would have been lower for accepting a higher excess level. Secondly, insurance companies like to know that the car is safe and away from potential danger. If security is spent on the vehicle to include such features as an alarm and immobilizer, the driver will be rewarded with a lower premium. Similarly if the vehicle is parked in a garage over night rather than left on a public street, this is lower risk resulting in lower premium payments further. Lastly, research has found* that by shopping around between various insurance companies and obtaining quotes, it is possible to lower car insurance premiums by up to 35% as the various insurance companies haggle for your business.

As with all insurance policies available on the market, Under 21 insurance is available at varying levels of cover. Depending where you are situated in the world and governed by different insurance guidelines, insurance for this age group can vary from basic levels of cover, which for example may simply cover the third party in an accident to fully comprehensive cover which insures against any eventuality. Obviously the higher level of cover, the higher the premium paid.

Bespoke insurance can include cover for classic or modified cars, young or convicted drivers, female drivers, high performance vehicles and even for particular models such as Mini’s and Volkswagen.

High performance and sports cars in particular require bespoke insurance policies for various reasons. Firstly the value of the actual vehicles tend to be higher than average due to them being technically advanced, powerful and from high end manufacturers such as Lamborghini, Ferrari and Porsche for example. Similarly they may be high performance and modified vehicles such as the Japanese Nissan GTR imports from the late 1990’s. Other specialist car insurance that falls into the performance car bracket includes the following:

• Prestige;
• Classic;
• Imported;
• Modified;
• Sports;
• Hot Hatch;
• Kit Cars;
• 4×4’s.

It is not simply the general high value that these vehicles possess, but also they tend to be highly desirable too. Because of this, performance cars are a target among thieves and vandals and by being highly desirable, most insurers providing high performance car insurance state that the vehicle must be left in a garage or driveway over night and have a recommended minimum level of security installed. The security may include but is not limited to advanced alarm systems, vehicle GPS tracking, immobilizers and steering or wheel locks.

In addition to a performance cars desirability, the actual high performance of the vehicle is too considered high risk on the road. Performance cars have very quick acceleration and top speeds which are often difficult to control if the driver is inexperienced. Even with an experienced driver controlling a performance or sports car, in difficult driving conditions the vehicle may be more difficult to handle than a ‘standard’ vehicle. Some performance car insurance companies will reward the client with lower premiums if particular and specialist advanced driving courses are taken. These are designed especially for these types of vehicles and help the driver understand exactly how they behave and how to apply that knowledge to every day driving. Often the insurance company will specify which particular advanced course they would like driver to participate in.

All of the points above result in an overall high risk bracket for the client in the eyes of the insurance company and therefore the premium price will reflect this. Most general car insurance companies will not quote a policy for a performance car unless the driver is at a certain age or has had experience with them. Some do not cover performance cars at all.

With this in mind, car insurance companies have introduced more flexible methods of payment for their client’s premiums in recent years. This includes pay monthly plans spread over eight to twelve months and also ‘pay-as-you-go car insurance’ which is also known as ‘pay-as-you-drive car insurance.

These policies work in a very similar fashion to ‘pay as you go’ mobile phones. In other words, you only pay for insurance as and when you use your car. If your car is left idle for a few days, then you do not pay insurance for that time. Coverage still remains 24 hours a day, 365 days a year. Policies are usually divided into particular age groups, though this does vary between insurers.

Pay as you go car insurance can be beneficial to drivers that use their cars very infrequently, off of main carriageways and in off-peak periods.

To be able to apply for pay as you go car insurance, the vehicle in question needs to be fitted with a GPS (Global Positioning System) device, the cost of which is usually subsidized by the insurer. The GPS device then records the time, date and travel data that the vehicle makes on a daily basis. This information is then sent to the insurer and then the client receives an invoice calculated by the number of journeys that have been made. Again all insurance companies that offer pay as you go insurance vary, however the policy charges are usually made up from the type of road that I travelled on (motorways are cheaper than town roads), the number of miles driven and the number of days of the month the vehicle was used. Charges per mile vary greatly depending on the client’s age and usage.

Pay as you go car insurance will suit some drivers over others. For example, young drivers with high premiums or high performance car owners that use their sports cars as second cars. A young driver under the age of 21 may benefit, especially if the vehicle is not used much. With pay as you insurance the price of premium never exceeds the value that a client would be insured at with a standard policy. Therefore if someone was paying 100 units per month with standard cover, then with pay as you go, the premium would not exceed 100 units, however that person may only incur a real premium of say 80 units for that month. A saving of 20 units for the month. Please make sure to check that this is the case with any particular insurer as all policies can vary.

This type of car insurance is certainly beneficial to particular drivers, mainly those that have a low yearly mileage or are paying a high premium already for whatever reason. However there is a certain disadvantage too. Because the vehicle is fitted with a GPS device and the cars speed is monitored, this data can be used as evidence should there ever be an accident. The data will clearly provide proof if the driver was speeding, which in turn may go for or against the client in the event of a policy claim.

The last benefit of pay as you go car insurance is that it makes the vehicle easier to find should it ever be stolen!

• Add two cars for insurance under separate policies at the same time often resulting in a lower premium per car;
• Use a ‘multi-car’ option which combines both vehicles under one policy;
• Some insurers offer multiple cars to be registered at a particular address or;
• Specialist two car insurance from one owner.

With the first option above, two cars can operate under their own individual policies with both policies being eligible for no claims bonuses. The insurance would likely be generic however by taking out two policies at the same time it is possible to reduce premiums for both, especially if the client were playing one insurer against another.

Often known as ‘multi-car’ (or multiple-car), this policy is similar to the above in that two or three cars are covered for insurance, however each vehicle will share the same policy rather than having their own. This would mean that only one no claim bonus would be awarded; however by combining multiple vehicles under one policy, this greatly reduces the premium amount. This type of insurance is also now offered by some insurers in combination with house insurance as a special package also.

In a similar fashion to the above multi-car policy, specialist insurers may also offer the option to the client for two or more cars to be insured under one address. This is ideal for families and house sharers in particular and again results in cheaper premiums compared to two or more individual policies.

Lastly, if one client owns more than one vehicle, both may be included under a single policy. This may not be relevant for certain types of vehicle such as high performance sports cars, however these policies cover most types of vehicles. One must make sure an insurers terms and conditions are understood with regard to the above two car insurance options.

Car insurance will always have a pre-determined length of cover when the policy is agreed between insurer and client. The standard term for any vehicle insurance is a year in length, however relatively new recent additions to underwriters policies can mean a policy length of anywhere between 24 hours to any number of months.

No matter what duration the cover is for, the insurer will inform a client with suitable notice that a policy needs renewing. For yearly policies, usually three weeks to a months notice will be given. This ensures that plenty of time is given to ensure that the cover will not expire and continuous cover is maintained.

When a policy is due or renewal, the insurer will inform the client of any changes that be made to the conditions of the policy. This could include the actual cover itself or any changes to the premium paid. If the policy has remained claim free, a discount for the renewal of the policy will likely be given due to the no claims bonus.

Often an insurance company will arrange an automatic renewal of a policy should the client not state otherwise. This means that the client agrees to continuous cover unless otherwise stated and can be a convenient set-up for both parties. If any circumstances change on behalf of the client, the insurer must be made aware of the changes in order for them to recalculate the premium if relevant. Similarly, some insurance companies require that if a policy is to be cancelled, written or verbal notice is given.

At the time of a policy renewal, it is always worth researching alternative quotes from competing insurers to ensure the lowest possible premium is awarded and the level of cover is at a maximum. As is usually the case, insurance companies can be played against each other to minimise premiums as they tussle for a clients business.

More information on car insurance renewal can be found online, however as every insurance company have different terms and conditions, individual insurers’ terms should be checked in order to see what is expected of a particular policies renewal conditions. Often car insurance renewal can not be processed online or via email by many insurance companies.

Once a new policy or existing policy has been renewed, a new certificate of motor insurance and other insurance policy documents are sent to the client when the new policy commences.

Whether insurance is covered on behalf of the vehicle rental company or through a specialist third party insurer, the cover is determined by the liability from which factors are associated with the rental such as duration, level of cover and risk. The level of cover can be determined from the following:

• CDW – collision damage waiver, may or may not be limited to certain vehicle parts such as windscreen, tyres, wheels and even the car roof. If collision damage waivers are declined by the driver, all damages that occur to the vehicle are their responsibility;
• ‘Loss of use’, referring to the money that is lost through a vehicles rent because of damages. Many rental insurance does not cover this eventuality;
• A supplement to liability insurance. This acts as secondary coverage to any personal policy that is held;
• Personal accident insurance;
• Primary liability car insurance – where clients may not already have a vehicle policy or do not want to use them as part of a rental agreement; Personal belongings protection – protection against personal belongings that may be damaged, lost or stolen while in a rental vehicle.

Of course when renting a vehicle, basic insurance is a necessity of law. The level at which cover is issued is the decision of the client and cover premiums will vary depending on various factors such as:

• The age and sex of the insured;
• The value of the vehicle;
• The duration of cover required;
• The level of cover requested;
• Whether a policy is taken out by the rental company itself or through a third party specialist or broker;

It is very important to understand what is expected of the client financially in the event of an accident or damage that is made to the vehicle. Generally speaking a policy taken out by a third party insurer will be at a higher level than that of a rental company. Also the premiums would likely be lower too from a third party specialist or broker.
Ideally car rental insurance should include liability, collision and comprehensive cover. This way the majority of outcomes are covered in the event of an accident and not only is the vehicle covered to a high level, but also the liability of another person being injured.

If a client of a particular country intends to travel abroad for any length of time, it can be difficult or impossible to find temporary cover from insurers in the destination country.

Many standard car insurance policies may already partly or fully insure a vehicle up to a limited duration, for example 30 days. However if longer term international insurance is needed, then a specialist policy may be required. For indefinite vehicle cover for an indefinite period of time, bespoke international car insurance for driving abroad can be obtained. This is useful for any individual and for the following:

• Expatriates;
• Diplomats and politicians;
• International businesses and employees;
• International charities and charity workers;
• International schools and colleges;
• Humanitarian organizations;
• Religious orders.

Though bespoke international car insurance is useful for driving abroad, it is important to verify which borders will be crossed on the duration of the stay as local laws of each country may vary and this will need to be pre-determined to assume the correct cover and premium to be paid. In addition, some countries may require that the driver is insured by local insurance companies in addition to any cover bought in the country of origin. This is usually due to damage or loss of the vehicle which may not include third party liability. Local laws and regulations of the destination country may also state that repairs are arranged locally.

For these reasons, prior to travel, it is a necessity to confer with the Foreign office for advice of local laws. It is likely however that a specialist in international car insurance will be aware of local laws governing car insurance for most major countries.

As a bare minimum, when driving abroad, the following should be areas in which cover be included:

• Collision damage;
• Accidental damage;
• Fire damage;
• Theft;
• Windscreen breakage;
• Vehicle accessories as well as tyres and wheels;
• Protection for armed robbery, hijacking and civil commotion;
• Cover for natural disasters, such as hurricanes, flooding and earthquakes;
• Serious damage and stolen payment protection;
• Multiple vehicle and fleet insurance if required.

Variables in international car insurance for traveling abroad vary for many reasons such as the regulations from country of origin, regulations and laws in countries of travel, age, sex, vehicle type and duration of cover.

If traveling abroad, a specialist car insurer is recommended as they can help with local laws to provide cover for all eventualities of liability.