Car insurance for young drivers and under-25s in New Zealand

Can you get car insurance under 25 in NZ?

Yes. All eight insurers on this site sell cover that a driver under 25 can use, with one exception at the young end: Cove publishes that it gives no cover at all to anyone under 21. What changes for under-25s is the price and the excess, and sometimes whether they are covered to drive at all.

Consumer Protection, part of MBIE, puts the general position plainly:

“Be aware you'll pay a higher premium for drivers who are under 25 or who don't have a full licence.”

— Consumer Protection (MBIE), Car insurance, read 2026-09-16

That is the premium. The excess is the part people find out about after a crash, and it is where insurers differ most.

What does each insurer publish about young drivers?

Only two of the eight publish a figure. State applies its same $300 standard excess to drivers under 25 on policies quoted from 17 May 2026. Cove adds $500 for a driver aged 21 to 24, or $1,000 without a full licence, and covers nobody under 21. The rest say the figure is on your schedule.

Two quotes are worth reading in full, because they are the strongest statements on the list. Cove on drivers under 21:

“At this stage there is absolutely no policy cover for anyone under the age of 21 – this includes non regular drivers of your vehicle that are not named on your policy.”

— Cove Insurance, Car Insurance, read 2026-09-16

And State on drivers under 25:

“With State, drivers under 25 get the same great cover and the same low $300 excess on car policies.”

— State, Car Insurance, read 2026-09-16

What does “exclude drivers under 25” mean?

It is an option some insurers offer that removes cover whenever a driver under 25 is at the wheel, usually in return for a lower premium. It suits a household where no young person drives the car. If one does and crashes, the claim can be declined, not just charged a bigger excess.

Tower's wording, for example, covers anyone driving with your permission “unless you've chosen the optional benefit No cover for drivers under 25 years old”. AMI's wording confirms the same kind of restriction can be recorded on a schedule. The saving is real, and so is the risk: a teenager who borrows the car once is the scenario this exclusion is written for.

Does a restricted or learner licence change things?

It can, separately from age. Cove's extra excess is $1,000 for a driver without a full New Zealand licence, which catches learners and restricted drivers of any age. Vero's wording names a separate “new driver excess” as well as its underage one. Ask what applies to a learner or restricted licence before they drive.

A learner or restricted driver who is also under 25 can face both conditions at once. On wordings that apply “the higher of” two driver excesses, only one is charged; on others they may add together. The wording decides, so ask for the dollar figure on your own quote. Breaking a learner or restricted licence condition is a bigger risk than either excess: car insurance for learner and restricted drivers quotes the four wordings that remove cover altogether.

Should a young driver be named on a parent's policy?

If they drive the car regularly, the insurer needs to know, and many policies require it. Consumer Protection warns that if you name drivers and let somebody else drive, “your insurer is unlikely to honour your claim.” Being honest about who drives also matters for the young driver later: a claim history in their own name is something future insurers ask about.

What you cannot do is put a car a young person mainly drives in a parent's name and leave them off to get a lower price. If the insurer finds the main driver was not disclosed, it can decline the claim.

What changes when you turn 25?

The under-25 excess stops applying from your 25th birthday, because wordings test the driver's age at the time of the crash, not when the policy was bought. Cove's wording, for example, charges its extra $500 only if the driver “at the time of the loss or accident” is aged 21 to 24. A cheaper premium is a separate matter, usually set at renewal.

A worked example on Cove's published figures: a driver with a full licence crashes a week before turning 25 and pays the standard excess plus $500. The same crash a week after the birthday costs the standard excess alone. Nothing about the policy changed; the driver's age on the day did.

Two things do not happen on their own. The premium is usually recalculated at renewal, so a policy that runs past your birthday can keep the under-25 price until it renews. And the licence rule is separate from age: a 26-year-old on a restricted licence can still meet Cove's $1,000 inexperienced driver excess. When you turn 25, tell your insurer and ask whether the premium changes now or at renewal.

How can a young driver pay less for car insurance?

Compare the young-driver terms, not only the premium: an insurer with no extra under-25 excess can cost less after one crash than a cheaper quote with one. Then pick the cover that suits the car's value, get a full licence as soon as you can, and name every driver honestly.

• Ask every insurer the young-driver excess in dollars. The gap between them is wide: State publishes the same $300 at every age on policies quoted from 17 May 2026, Cove adds $500 for a 21 to 24-year-old on top of its standard excess.
• Match the cover to the car. On a low-value car, third party or third party fire and theft can cost less than comprehensive, and the gap a crash leaves is smaller. Comprehensive vs third party sets out what each level pays for.
• Get the full licence. Cove's $1,000 excess applies to any driver without a full New Zealand licence, whatever their age, and Vero's wording lists a separate “new driver excess”. Moving from restricted to full is one of the few changes that can remove an extra excess outright.
• Weigh a higher voluntary excess carefully. Choosing a bigger excess usually lowers the premium, but a young driver may already carry an extra excess on top of it. Add the two together and ask whether you could pay that total tomorrow. How excess works.
• Never leave the main driver off to save money. If a young driver is the one who mostly uses the car, the insurer needs to know. A lower price that gets a claim declined is not a saving.

What to ask before you buy

1. Which drivers are covered: anyone with permission, named drivers only, or nobody under a set age?
2. What is the extra excess for a driver under 25, in dollars, and does it add to the standard excess or replace it?
3. Is there a different excess for a learner or restricted licence?
4. Does the young driver excess apply to theft and vandalism claims, or only to crashes? At least one insurer says its driver excesses do not apply to theft or malicious damage.
5. If I choose to exclude drivers under 25, what exactly happens if one drives and crashes?