Parenthood is fraught with fears and firsts - perhaps none more daunting than when your child begins driving. When your kid gets their L or P plates, one of the first steps you'll want to take is adding them to car insurance on the family vehicle, or taking out a policy for their new set of wheels.
But car insurance for L and P plate drivers can be tricky. Here are some starting points to look out for.
1. You'll have higher car insurance premiums
As the Australian Securities and Investments Commission (ASIC) points out, most car insurers will charge increased premiums if you take out a policy for someone under 25, or add an under-25 to your existing policy.
2. Add your child to your car insurance as soon as possible
Adding someone to your car insurance can be a menial piece of admin, but it's a good idea to get it out of the way before they even start driving your car.
3. Third-party car insurance can be essential
According to ASIC, the average vehicle repair job costs $3,000. If you or your child cause damage to another person's vehicle and don't have third-party insurance, you will have to foot the bill. Ensuring this third-party cover accounts for your child is critical.
4. Prepare for excesses
Insurers will often have higher excesses for L and P plate drivers, as well as a set under-25s excess. Make sure you know exactly what these are (and that your child does too).
5. Calculate your kilometres
If you have usage-based or pay as you drive insurance, it will be important to work out how this will change. What will your child use the car for? How far will they go, where will they be parking, and does this introduce any new risks (like potential for theft)?
6. Choose the right individual policy
If your L or P plater is going to have their own policy, make sure they understand exactly what they're getting. While comprehensive car insurance has everything, they may want to opt for third party fire and theft, or third party property cover.
While more cover is always better, the decision may be theirs - help to educate them on what works best.
With the right car insurance, letting your child out on the road with their L or P plates doesn't have to be a scary step. To find out more about your options, drop into your nearest BOQ branch.