Car Insurance For Learner Drivers – Options & Costs Compared

  • A separate learner driver car insurance policy could cost $50-$270 more each month compared to adding a learner to an existing policy, based on analysis by Money.com.au.
Learner driver
Learner driver

In our learner car insurance guide:

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Like any other driver, learner drivers in Australia should have some type of car insurance before they get behind the wheel.

What car insurance options are available to learner drivers in Australia?

Generally, learner drivers can either be automatically included in your car insurance to drive your vehicle under your supervision or be added as an extra driver. Alternatively, they have the option to get their own car insurance. Whether you add your child to an existing car insurance policy, or buy a new one, will depend on whether they learn to drive in the family car or in their own registered car.

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Keep in mind that an additional excess (a payment you make towards a claim) usually applies where a learner driver was at fault. This is in addition to any other policy excess.

Learner drivers can typically be covered under any car insurance, including a comprehensive policy, third party property only or third party fire and theft cover. Most people with a learner driver covered under their policy have a comprehensive cover, according to Bingle. This is because it covers a broader range of events, with higher benefit limits.

Depending on the insurer, there are generally three options for insuring a learner driver.

1. Automatic coverage under your car insurance

Under some car insurance policies, learner drivers are automatically covered, but as unlisted drivers. Whether a learner is covered under your policy may be specified in your PDS, or you might have to call your insurer and check. Car insurance providers like Suncorp, AAMI, Bingle and Youi don't require any changes to your policy to supervise a learner driver in your car.

  • Pro: There’s no extra cost and you don’t need to update your policy.
  • Con: It typically comes with a hefty ‘unlisted driver’ additional excess.

2. Add learner to your policy

In some cases, you will have to add your learner driver to your existing policy as a listed driver or your car may not be covered. Car insurance providers like Budget Direct and ING require you to add a learner driver to your policy.

  • Pro: There’s a lower listed young driver excess compared to an unlisted driver excess (which is typically higher).
  • Con: It may increase your premium marginally.

3. Take out a separate policy for a learner driver

If a learner driver has their own registered vehicle, they will need a separate car insurance policy, listing them as the policyholder and regular driver. In the case of young drivers, they will generally pay more for coverage as they’re considered high-risk and have no previous driving history that insurers can consider when calculating premiums. Taking out a separate policy may be the only option for learners who are older.

  • Pro: Learners can build their Driver Rating (a rating based on your driving history) sooner and eligibility for a no-claim bonus.
  • Con: Generally the most expensive option.

What’s the cheapest way to insure a learner driver?

  • Cheapest option but with higher excess: Automatic coverage for learner driver

You won’t pay more for car insurance when a learner driver is automatically covered under your policy. In this case, they’re not nominated on your policy, which means you’ll pay an additional ‘unlisted driver excess’. This could be higher than the excess for a listed driver under 21. For example, Youi has a $2,000 excess for unlisted drivers.

  • Mid-priced option: Add learner to your policy

Adding a young driver with a learner's permit to your policy may increase your premium (the sum you pay to maintain your cover), but our analysis shows the difference in premium is usually not significant. An additional ‘age excess’ will also apply if you make a claim, but it may be less than the unlisted driver excess. For instance, Youi has a young driver excess of $700 while the unlisted driver excess is $2,000.

  • Most expensive option: Take out a separate policy for a learner driver

Getting a separate insurance policy for a learner driver will generally be the most expensive option and can notably increase car insurance premiums. In some cases, it may even double the cost of car insurance, compared to insuring a learner under your policy. An additional young driver excess will also apply, and in some cases you may pay a ‘learner driver excess’.

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Car insurance including young drivers generally costs more as they’re statistically more likely to have an accident, according to Transport and Main Roads (QLD).

Compare car insurance costs for a learner driver

Here’s an example of the cost difference for comprehensive car insurance with a 16-year-old learner driver automatically covered by an existing policy, added as a listed driver, and covered under a separate policy. Quotes for the first two scenarios are based on a 30-year old female main policyholder in QLD driving a 2019 Mitsubishi ASX (private use), with no previous claims. Prices shown are for these scenarios only and are not necessarily indicative of what you may pay.

Comprehensive car insurance

Learner automatically covered under existing policy

Budget Direct

$105.83 per month

Youi

$110.62 per month

ING

$116.13 per month

Comprehensive car insurance

Learner driver added to policy as listed driver

Budget Direct

$114.49 per month

Youi

$112.17 per month

ING

$129.30 per month

Comprehensive car insurance

Learner driver with separate car insurance policy

Budget Direct

$157.97 per month

Youi

$384.89 per month

ING

$169.59 per month

Comprehensive car insuranceBudget DirectYouiING

Learner automatically covered under existing policy

$105.83 per month

$110.62 per month

$116.13 per month

Learner driver added to policy as listed driver

$114.49 per month

$112.17 per month

$129.30 per month

Learner driver with separate car insurance policy

$157.97 per month

$384.89 per month

$169.59 per month

Quotes obtained on 10 January 2024.

Learner driver excess explained

In most cases, insurers will charge you an additional excess if a learner driver has an accident while driving your vehicle and you make a claim. This is on top of the basic excess that applies to all claims.

Depending on your insurance policy, a different additional excess may apply, but common ones include:

  • Unlisted drivers excess: This is payable if an unlisted driver using your car is involved in an incident. This applies even when a learner driver is covered but not listed on the policy.
  • Learner driver excess: Some insurers may apply an additional learner driver excess for claims involving a learner driver.
  • Inexperienced or young driver excess: Also known as an ‘age excess’, this applies to claims involving drivers under 25 or who have had their licence for less than two years. Some policies have different excess tiers for young drivers under 21 and up to 25.

Example of additional excess for unlisted learner drivers vs learners listed on the policy

This table shows different excess amounts for unlisted learner drivers versus listed young drivers under 21 from selected insurers. Be sure to read your insurer’s Product Disclosure Statement (PDS) for the excess that applies to your individual policy. It can be found under the ‘Excess On Claims’ section.

Excess option

Unlisted learner driver excess

Budget Direct

$600

ING

$2,000

Youi

$2,000

Excess option

Listed young driver excess (under 21)

Budget Direct

$500

ING

$600

Youi

$700

Excess optionBudget DirectINGYoui

Unlisted learner driver excess

$600

$2,000

$2,000

Listed young driver excess (under 21)

$500

$600

$700

Information correct as at 10 January 2024.

How to add a learner driver to your car insurance

You can update your car insurance policy to include a learner driver by contacting your insurer directly by phone, or via your online profile where you can select ‘update my policy’ and follow the prompts to add a new listed driver.

Learner update policy

How to save money on car insurance for a learner driver

It may be cheaper upfront (as in you pay no extra cost) if you have an existing car insurance policy that automatically covers learner drivers. But be prepared to pay a higher additional excess for an unlisted driver if you make a claim.

  • Saving tip: Compare prices to see if the higher applicable excess in this scenario is worth it or whether you’re better off adding a learner to your policy (and pay slightly more for cover) until they obtain their provisional licence.

Some insurers require you to list your teenage learner driver on your policy. In some cases, the ‘age factor’ may increase your premium slightly. Listing a learner driver on your policy can give you extra peace of mind and your additional excess may be less overall (since all drivers are listed).

  • Saving tip: You could opt to pay your premium annually instead of monthly for a discount if your insurer offers it. You could also adjust your young driver excess to lower your premium, but be prepared to pay more if you make a claim.

If your child has their own car, they will need a separate car insurance policy, listing them as the policyholder. This is the most expensive option as learner drivers may not be eligible for discounts and drivers under 25 usually pay a higher car insurance premium for the added risk to the insurer.

  • Saving tip: In this case, it’s typically cheaper to insure the car for market value and to remove any extras. However, opting for a lower level of cover means you may not be insured for as many events and may face higher out-of-pocket costs if you make a claim.

Written by

Megan Birot Money.com.au writer

Senior Finance Writer

Megan Birot

Reviewed by

Sean Callery Editor Money.com.au

Editor

Sean Callery

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