Getting your first car in Singapore is a milestone. It represents freedom, independence, and the ability to move on your own terms. The thrill of hitting the road for late-night snacks, weekend getaways, or simply commuting without relying on public transport is undeniable. Yet, for many young drivers, the excitement is quickly tempered by reality: the high cost of car ownership, particularly insurance.
Insurance premiums for young drivers are disproportionately high. Inexperienced drivers, particularly those under 27 years old, pay significantly more due to statistical risk factors. According to The Guardian, claim frequency for new drivers is higher, making them more expensive to insure.
A young driver can pay double or triple what experienced drivers pay for the same car model and coverage level. Added to this are other ownership costs, including the Certificate of Entitlement (COE), car loans, parking, fuel, and maintenance, which makes owning a car a substantial financial commitment.
One of the most effective tools to manage insurance costs is the No-Claim Discount, or NCD. NCD reduces your annual premium for every year you drive without making an insurance claim. Typically, after one claim-free year, a driver may receive a 10 percent discount. This can increase incrementally, reaching up to 50 percent after five or more consecutive claim-free years.
However, NCD is traditionally tied to the vehicle’s policyholder. This creates a challenge for young drivers who often share family cars or drive vehicles registered to parents or spouses. Even if they drive safely for years, they may not accrue NCD under their name, meaning when they purchase their own car, they start from zero and face full premiums.
Some insurers now allow named drivers to build their own discounts even if they do not own the vehicle. This creates an opportunity for young drivers to start accumulating claim-free years from day one of learning to drive. By adding family members as named drivers under a policy, families can ensure that every safe ride contributes to future insurance savings.
Imagine a family where a young driver is added to a parent’s policy. Over three years of safe driving, the young driver remains claim-free. When they purchase their own vehicle, they can start with a 30 percent discount instead of paying full premiums. Over several years, this could save thousands of dollars.
You began driving on your parents’ car at 18. You remained claim-free for three years while gaining experience under supervision. When you bought your first EV at 21, you already qualified for a significant discount. Your first-year insurance premium was reduced by S$1,000 compared to peers with no prior NCD. The combination of experience and early discount accrual allowed you to manage your car ownership costs more sustainably.
While individual savings vary depending on the insurer, car model, and COE costs, the principle is clear: starting early creates both financial and behavioural advantages.
Insurance is only one part of the total cost of ownership. COE prices have continued to rise, with Category A COEs reaching S$97,724 in April 2025. Fuel, maintenance, road taxes, and parking add to the cumulative cost. For young Singaporeans, the upfront costs can feel insurmountable, discouraging car ownership altogether. By leveraging discounts early, families can reduce one of the most volatile cost components, yes the insurance, while teaching responsible driving habits.
Every safe ride becomes tangible evidence of careful behaviour. Families benefit when both younger and experienced drivers learn to share responsibility, maintain records, and cultivate habits that reduce risk.
Insurance does not have to be a financial penalty for young drivers. By understanding your policy terms, starting early, and planning strategically, new drivers can transform everyday driving into long-term savings. Families gain financial leverage while reinforcing a culture of safe and responsible driving.
Even before owning a first car, young drivers in Singapore can begin building value. Each claim-free year compounds, creating both monetary and behavioural advantages that extend well into independent driving.
For families or young drivers looking to maximize insurance saving early, ECICS Family NCD Builder allows named drivers to start building discounts even without owning a car. It’s a practical way to turn every safe ride into long-term savings and ensure young drivers are rewarded for responsible driving.
You can explore your options with ECICS to see how your family could benefit.
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