Here’s how your insurance is impacted by license upgrades

Have you upgraded your license? Going from a Class 5 learner’s license and moving onto your full Class 5 is a huge step, and quite rightly considered to be something of an initiation rite for young folk throughout the province. Having a full license indicates that you have the skills necessary to drive safely on the road and that you know exactly what you need to do to get from Point A to Point B in a law-abiding manner. In addition, you’ll have had to held onto your learner’s license for at least 2 years before you can obtain your Class 5 license, which helps to ensure that you have at least the good driving record and time spent behind the wheel.

But what about your insurance? How does your insurance reflect a change in license? After all, if a license indicates an improvement in driving abilities, shouldn’t that show your insurance provider that you are trustworthy enough to qualify for an insurance discount?

Simply put, will graduating to a full Class 5 license lower your insurance rates? Read on for the answer (and more!) below.

Inexperienced driver insurance rates can be expensive

As you may already be aware, being a more inexperienced driver – both in terms of the length of your licensing and your biological age – can result in heightened insurance rates. Why is this the case? Well, insurance companies gauge your rates based on a huge number of factors – (which differ by provider) – which are essentially calculating your risk. The higher your risk based on the statistics each individual insurance provider has in their databases, the more you’ll pay for your premiums.

Nearly every insurance company weighs being inexperienced and young as being higher risk. Unfortunately, the stats are simply against these types of drivers. There’s actually proof that suggestions the risk of motor vehicle crashes is nearly three times as high among teens aged 16-19.

You can be a great driver, and being claims-free is a great help, but unfortunately you can’t do much about your age and inexperience except to wait and slowly build up time and expertise behind the wheel. High premiums will decrease as you demonstrate that you’re a law-abiding and safe driver – you just must be patient.

Does having a full license lower my auto insurance rates?

Short answer: yes! Most drivers, varying depending on their insurance provider, will see around a 10% insurance on their insurance premium when they graduate from a learner’s license to a full license.

It’s not a huge discount, but it’s something, and for young drives it may represent relatively substantial savings. Moreover, the more years you accumulate of clean driving, the more your insurance rates will reduce. 4-5 years of clean driving may reward you with up to a 25% discount on your insurance rates for being claims-free. This is also assuming you haven’t acquired any tickets or experienced an at-fault incident during this period as well, as those will also factor into your “clean driving” record.

How do I reduce my auto insurance premiums if my rates are still high with a full license?

Being young is also a factor in your rates, even if you’ve acquired a full license before the age of 25. That time spent being fully licensed won’t be for nothing – but it may take some time to pay off. Until then, there are a few ways you can reduce your rates even more – and without slashing any coverage! Consider the following tips for reducing rates:

• Take a defensive driving course. There’s plenty available to take in the province of Quebec. You may consider asking your broker or insurance provider for advice regarding which defensive driving courses are approved for insurance reductions.
• Drive less. The more mileage you strike up, the more you’ll pay – as statistically, those who are on the road for more time and for more distance have a higher chance of getting into an accident. You can opt for public transpo where possible.
• Raise your deductible. This means you’ll pay out more in the event of a claim, but your overall insurance premiums will be reduced.
• Be a safe driver. Being claims free goes a long way. You won’t see the immediate results but being claims free for 3-5 years can reap some serious benefits.
• If you’re driving an older car, considering dropping the collision/comprehensive coverages. Some cars cost more to repair than they’re worth, so at this stage it’s wiser to simply drop these added coverages and reduce your overall costs.
• Work with a broker – like the ones here at Panda7 – to review your personal circumstances, help you shop around for the best quotes for auto insurance in Quebec, and get expert advice!

It's a pain – and we get it. Being a young and inexperienced driver is great fun once you’re finally behind the wheel of a vehicle, on your own, with nothing but the road ahead of you…but you’ve also got those high insurance premiums to worry about. Don’t worry! Your insurance rates will go down when you get your full license and will continue to decrease as you slowly gain experience with time.