“Bank of Mum and Dad” stumps up over £1,000 for first car
On average parents are willing to contribute £1,014 towards the cost of their child’s first car, according to research from online insurance price comparison service Gocompare.com.And, while almost a third of parents said they made do with an old banger (more than 10 years old), nearly three quarters expect their child’s first vehicle to be just five years old or newer. But, warns Gocompare.com, with car insurance premiums at record levels, the most valuable thing parents can do for their children is to research the cost of insuring a car before buying it and to shop around for the best deal.
Hayley Parsons, Managing Director of Gocompare.com said, “Three quarters of the parents in our survey, have or intend to contribute to the purchase of a vehicle for their offspring – but it’s not just the price of the car they need to consider. For a young driver, it can cost more to insure a car than the value of the vehicle itself.
“The latest premium index studies show that car insurance premiums have reached their highest ever level - both for comprehensive cover and for third party, fire and theft insurance which is typically bought by young and inexperienced drivers. And, it looks likely that this upward trend will continue. The difference in premiums between insurers for young drivers is often greater, the younger the driver – making it all the more important to shop around for the best deal.”
Newly qualified drivers and those under 25 generally pay higher insurance premiums. Their lack of driving experience means that they are not eligible for the no-claims discounts that more experienced drivers may be entitled to and, they are likely to have higher policy excesses. To help young drivers get motoring, Gocompare.com has produced the following checklist to keeping costs low:
Generally, the lower the engine capacity, the lower the premium – ideally an engine size of less than 1200cc is best. Also, avoid models with letters after it, for example ‘i’, ‘sxi’, ‘gti’ or ‘xl’.
Avoid vehicles with any modifications from the standard manufacture. Many insurers will not quote online for vehicles with modifications – no matter how small.
Consider taking the Pass Plus training course which is designed to give new, young drivers additional practical driving experience. Once completed, the course normally entitles drivers to reduced premiums. Visit www.passplus.org.uk for more information.
Shop around for your insurance – don’t settle for the first quote you are given.
The cost of taxing a vehicle can also vary, depending on the CO2 emissions that it produces. The lower the emissions, the cheaper the cost of vehicle tax. The UK fuel economy label will help you choose a vehicle which is fuel efficient and produces lower carbon emissions. These are ranked from Band A to Band G.