It is a fact that you will have an accident whilst driving your car! Sorry if that sounds shocking, but it is true.

Around one in five newly qualified drivers will be involved in an accident within a year of passing their test. Older drivers are likely to have an accident every 12000 miles. That is the same as an accident a year. Younger drivers it is nearer 10000 miles.

When you have an accident, you might have to pay for repairs to your car and, possibly repairs to the other person's car. That is why you need insurance. That is why the law insists that you are insured to drive that car.

The penalties for driving without insurance are very severe. The police will tow your car away and keep it until you have insurance. They even bill you for the pleasure of loosing your car. You could face fines, prison, a driving ban and points on your licence.

What does car insurance cover?

That depends on the level of cover. Car insurance comes in three levels. Fully Comprehensive, Third Party Fire and Theft and Third Party Insurance. Each level offers more protection than the lower levels.

Third part insurance is also known as act insurance. The law demands that you have at least third party insurance. If you take third pary insurance you are covered for damage to other people and their property. Your car repairs still need paying for.

Third party fire and theft does exactly what it says. It is third party insurance that also covers you for the theft of your car and it catching fire. Some TPFT insurances may also cover the contents of your car.

Comprehensive insurance offers the most protection. Notice that I say nearly every risk. Some insurance policies will cover your sat nave and others will not.

Key Terms

Premium - the amount you pay for the insurance

Exclusions - what is not covered by the policy. Your sat nav might be covered, but not if it is left in the car over night.

Excess - You have to pay the first so many pounds of each claim

No Claims Discount - your premium will reduce by a certain amount each year if you do not have an accident

Cover - The details that explain what you are insured against. You might be insured for loss of work on one policy. Another might cover taxis to work

Why is my insurance so expensive?

The amount you pay in a premium depends on the risk the insurance company is taking. Your age, address, sex, type of car, job, cover, excess, storage, mileage and no claims all affect your premium.

Take a young male who drives a Corsa. They live in the centre of a large town. The lad works on the doors at a local club. They spend most of their money on their car. To the insurance companies they are a high risk. They see inexperienced, lives in a crime area, in a night job, and likely to be showing off in the car.

Move the young male to a small market town and give them a new job. Make them a teaching assistant at a local primary school. They are less of a risk - there are less crimes in that area. Their job demands patience.

What can I do to reduce my insurance costs?

Your insurance premiums will drop when you reach 24 years old. The statistics show that you are less of a risk once you reach 24. In the mean time, there are certain things that you can do to reduce your insurance premium.

Take a Pass Plus course. A lot of driving schools and driving instructors are registered to teach Pass Plus. Pass plus is the DSA scheme that fills in the gaps left during your driving lessons. The topics include motorways and nighttime driving.

Become an advanced driver. Contact ROSPA or the IAM for details. The course is based on emergency service driver training. It could dramatically cut your insurance costs.

Drive a smaller older car. They cost less to repair.

Take a multi car policy with your parents.

Keep the car in a garage or drive.

Fit a Thatcham class 2 or class 3 car alarm

Do not

Do not make your dad the main driver if you are the main driver. This is called fronting. The insurance company will cancel the policy.

Do not forget to tell them about any additions or alterations to your car

Do not take a huge excess to reduce your insurance premiums. Some companies allow up to £500 excess. Remember excess means you have to find thus much money in the event of a claim.