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How much is car insurance for under 25s?


It’s no secret that drivers under 25 often pay more for car insurance than older drivers. Young drivers (17-25) make up a quarter of all Australian road deaths, despite representing only 10-15% of all licensed drivers, which — statistically speaking — means these drivers represent a greater risk to insurers.

These stats make things tricky for sensible drivers who are under 25 and looking to save a buck. But there are factors other than age that can influence your premium, and getting to know them can help you save.

Insurance for under 25s

In Australia, you’re legally required to take out Compulsory Third Party Insurance — aka Green Slip — or Motor Accident Injuries (MAI) Insurance if you’re in the ACT.  This covers compensation payments for people hurt or killed in an accident.

In Australia, you’re legally required to take out Compulsory Third Party Insurance. You might know this as Green Slip in NSW, CTP in SA or Motor Accident Injuries (MAI) Insurance if you’re in the ACT. This covers compensation payments for people hurt or killed in an accident.

But don’t confuse it with Third Party Property Damage Insurance! CTP doesn’t cover damage to vehicles or property. You’ll need another car insurance product for that.


Third Party Property

Third Party Fire & Theft



Damage to your vehicle

Damage to other people's cars and property

Loss or damage by fire or theft

Liability of death or injuries to others

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What affects the cost of car insurance for young drivers?

Type of car

The make, model and value of your car may affect your premium. Newer, pricier cars may be more expensive to insure due to potential repair costs. Modified cars may also attract higher premiums.

Your gender

Young male drivers are statistically more likely to get into a crash than young female drivers. They’re also more likely to speed according to statistics. Therefore, young males are high-risk in the eyes of many insurers.

Your claims history

Many insurers offer no-claims bonuses, and AAMI is no different. Our Safe Driver Rewards program rewards Comprehensive Car Insurance policy holders for every consecutive year they don’t make a claim.

Safe driving courses

Completing a safe driving course may lower your risk rating enough to get you some discounts on your premium.

AAMI can help you became a safer driver in just one day! Find out about AAMI’s Skilled Drivers course here.

Where you park your car

Your address can influence how much you pay. Where possible, park your car in a garage or secure location, rather than on the street.

Your address can influence how much you pay — your level of risk may vary suburb to suburb.

Your car usage

The more you drive, the greater your risk of being involved in an accident — which is reflected in your premium.

Your driving history

Having previous driving charges or convictions may affect your excess, the amount you pay towards the cost of your claim for each incident covered by your policy. We simplify the different types of excesses here.

Should you add yourself to your parents’ policy?

It depends. If you own your own car, or live on your own, it may make more sense to buy your own policy.

However, it may be more cost-effective to tag on to your parents’ policy if they own the car you’ll be driving — especially if you’re living at home and driving their car less than them. Adding yourself to your parents’ policy may increase their premium, and an age excess will apply if you get into an accident while driving.

How to get listed as an additional driver

1.    Get your parent to log into their online account.

2.    Select the policy you’d like to add the additional driver to.

3.    Choose ‘Update policy’ and then ‘Listed drivers’.

4.    Provide the extra driver’s details.

5.    Pay the extra premium, if applicable.


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Insurance is issued by AAI Limited ABN 48 005 297 807 AFSL 230859 (AAI) trading as AAMI. Any advice has been prepared without taking into account your particular objectives, financial situation or needs, so you should consider whether it is appropriate for you before acting on it. Please read the relevant Product Disclosure Statement before you make any decision regarding this product. The Target Market Determination is also available.