Since insurance companies price policies based on risk, the most effective way to bring down your auto insurance rates is to show your insurance company that you’re a safer driver. Aside from spending years behind the wheel, the fastest way to do this is to enroll in a government-certified driving school course. Read on to learn more about how driving school can save you money on auto insurance. 

Driving school discounts

On average, driving school saves new drivers 10% to 20% on their auto insurance—although, as with most things, the devil is in the details. These discounts typically last for two to four years, and they are most impactful when you have the least amount of experience. With new drivers often paying as much as $7,000 per year for auto insurance in Canada, for example, the driving school insurance discount can result in thousands of dollars in savings—paying for the cost of driving school several times over.

Are driving school discounts available to you? 

Most provinces incorporate insurance savings into their certified driving school courses.

How to save on auto insurance

To determine how much you might save on auto insurance from completing a driving school course, the best thing to do is have a chat with an auto insurance broker. While driving school tends to result in insurance savings of 10% to 20% on average, the exact savings you’ll receive are specific to your individual driving record, vehicle, city, and insurance company. 

On average, the driving school insurance discount is more impactful if you’re a younger driver living in an urban area with a high accident rate. If you’re an older driver, driving school will still save you money on your auto insurance, but because your base insurance rate will be lower, it might result in you saving hundreds, rather than thousands, of dollars.

How much can driving school save you on car insurance?

Below are a few examples of what your insurance savings could look like as a result of completing a certified driver’s education program. Based on a 16- to 20-year-old driver in Canada.

Why does driving school lower how much you will pay for car insurance?

Driving school can decrease your auto insurance premiums because it makes you a safer driver in the eyes of insurers. According to our Kruzee Driving School data, for example, pass rates for G2 tests tend to be below 60%. Students who do pass their G2 test are still relatively inexperienced on the road, and have a considerably higher accident rate. When students complete a ministry-approved driving school course, though, they learn defensive driving habits that make them safer drivers for life.

Have you ever heard of the S-curve? How about evasive maneuvers? These are all advanced driving techniques that you’ll likely only learn from a certified driving school. Parents, family members and friends tend to have less patience for this kind of teaching. They are not trained driving instruction professionals; they may not be teaching you the latest or safest techniques. Insurance companies recognize this, and reward individuals who complete a certified driver’s education course accordingly.

Finally, driving schools force students to practice safe driving under the guidance of a professional educator. When you complete your driver’s education course, your certificate with insurance provider has a record that you have a certain amount of practice behind the wheel in a variety of driving situations. This decreases your risk of an accident, and as a result, decreases the amount you’ll pay in monthly insurance premiums.

How does the driving school insurance discount work?

When you complete a certified driver’s education program, your driving school will submit a record of completion to your local governing transportation authority. Sometimes this is a paper certificate, but most of the time, it’s simply an electronic record. 

Upon receiving the driving school completion record, your local transportation authority (for example, the Ministry of Transportation in Ontario) will add the proof of completion to your permanent driving record. Insurance companies that access your driving record can then see that you’ve completed the driver’s education course, so you don’t actually have to do anything, which is very convenient.

When insurance companies see the proof of driving school completion on your permanent driving record, they adjust the rate of your risk. 

Typically, insurance companies rate drivers on a star system, with new drivers being rated at one star. Completing a driving school course in Ontario, for example, will change your rating to be similar to that of a three-star driver, or a driver with three-plus years of driving experience. 

As stated above, this will lower your insurance rates accordingly, typically by 10% to 20%. Most provinces that offer an insurance discount for completing driving school operate on a similar system to Ontario. 

Note if you are in New Brunswick, though: The province’s First Chance program means that drivers who complete a certified driver’s education course and are accident-free receive the same insurance rates as if they had been driving for six years, which is pretty sweet. That works out to a discount of $2,000 to $3,000 typically over a period of three to five years. 

Do all driving schools and insurance companies offer the same discount?

All driving schools give you access to the same insurance discount, if applicable to your province, but not all insurance companies do. What does that mean? Well, sometimes, driving schools claim to offer superior insurance discounts—but that’s a big red flag. 

Those provinces that do offer drivers’ ed discounts, their governments do not differentiate between driving schools. So, claiming that “school A” offers a better discount than “school B” is a lie. 

Rather, the regulations stipulate that students must complete a certified driving school course with any licensed driving school. In Ontario, for example, whether the driving school is a large national chain or a small local business, both are authorized to be applied for the same insurance discount. 

However, when it comes to insurance providers, the discounts can vary considerably. Not all insurance companies have the same appetite to insure new drivers. As a result, some insurance companies may offer greater discounts than others, based on the risk level they associate with new drivers. As such, it’s critical to compare insurance rates across a wide variety of providers to make sure you’re getting the best rate.

How to save even more money on car insurance

In addition to the driver education insurance discount, there are other ways you can save money on car insurance as a new driver, too.

The most impactful way to save money on car insurance is to be listed as an occasional and/or secondary driver on a family member’s insurance. Since you are to drive less frequently as an occasional driver, your monthly premiums will be lower than they would be as a regular driver. This can be a great way to get more experience behind the wheel if you’re not the primary driver.

Additionally, bundling auto and home insurance policies can also result in considerable savings—typically about 10-15% across your policies, but you should check with your insurance broker. Insurance companies incentivize grouping together your products through offering additional savings. 

Finally, some insurance companies may offer further insurance discounts (up to 15%) if you are under the age of 25 and have grades above 80%. Insurance companies have found that conscientious students tend to be safer drivers, so keeping your grades high can be a great way to save some more money on your auto insurance.

Should you sign up for a drivers course?

Yes, if you can. Driving school is an investment that can pay back for itself several times over in certain provinces. With a typical driving school course costing $600 to $800, the insurance discount can result in the course paying for itself within a year.

Insurance discounts aside, driving school is worth considering because it makes you a safer driver for life. And as we say in the auto driver industry, doctors and nurses can save lives after accidents happen, but quality driving lessons can prevent them in the first place. 

Read more on the costs of driving:

• The best used cars in Canada

• Are electric vehicles the new economy cars?
• Your guide to buying winter tires in Canada
• How much is insurance for a new driver?

About Mikael Castaldo

Mikael Castaldo is the founder of Kruzee, a Canadian edtech startup working to make it easier for new drivers to learn how to drive, get their licence, and get insured.

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