Buying a car for your child: A 2021 guide 

There are plenty of things to consider when buying a car for a P-plater. What safety features are required? What level of insurance coverage do they need? Secondhand or new?

Get some answers below — just in time for Christmas.

New vs. used

Buying new

If your budget allows, consider a newer car. It’ll likely have up-to-date safety features — like autonomous emergency braking — that may compensate for a newer driver’s experience gaps.

A new car may also come with less hassle. No mechanical inspections are needed, and a new car will have a new car warranty.

Buying used

The main advantage of buying used is affordability. The average new car typically loses up to 58% of its initial value over three years. A near-new used car may be a good, cost-effective option for your teenager. Aim for one around five to seven years old.

Choosing the right insurance coverage

A less experienced driver may be more likely to have an accident, so make sure your teenager has the right coverage.

Comprehensive car insurance for young drivers

You can’t prevent your kid from damaging their new car, but you can minimise its financial impact.

GIO’s Comprehensive Car Insurance will cover the cost of repairing or replacing your child’s car, as well as other people’s cars and property, even if your child is at fault. It will also cover things like theft, fire (including bushfire) and malicious damage.

Repairs can be pricey, and if your young driver is underinsured, you’ll probably have to foot the bill. With comprehensive car insurance, you’re paying for peace of mind.

Get a Comprehensive Car Insurance Quote

Third Party Car Insurance

For those looking for a more affordable level of coverage, there’s GIO’s Third Party Car Insurance, which covers damage to other people’s cars and property but not damage to the policy holder’s car if they’re at fault.

Explore GIO Car Insurance

Don’t forget CTP and MAI Insurance

If you’re buying your child a new car, remember the registration costs will usually include Compulsory Third Party (CTP) or Motor Accident Injuries (MAI) Insurance, except in NSW where you’ll need to purchase a CTP Green Slip before registering the vehicle. Check your local transport authority’s website if you’re unsure.

Safety features to consider

For a convenient way to compare car safety ratings, visit the ANCAP (Australasian New Car Assessment Program) website and search for the car’s make or model. Most modern cars have modern safety features like anti-lock brakes, hands free controls and autonomous braking. A key feature to look for is electronic stability control — it’ll help your P-plater maintain control of their vehicle around curves and slippery roads.

Know your budget

You may not need to spend big on a new driver’s first car. Set a reasonable budget and stick to it. Remember to factor in costs like petrol, maintenance, registration and insurance.

Read more:

• Buying a car at an online auction: Your handy guide
• How to check your car registration status 
• What to do when buying a used car

Insurance issued by AAI Limited ABN 48 005 297 807 trading as GIO. Consider the Product Disclosure Statement before buying this insurance.This advice has been prepared without taking into account your particular objectives, financial situations or needs, so you should consider whether it is appropriate for you before acting on it