We use cookies to allow us and selected partners to improve your experience and our advertising. By continuing to browse you consent to our use of cookies. You can understand more and change your cookies preferences here.


When you click on a retailer link on our site, we may earn affiliate commission to help fund our not-for-profit mission.Find out more.

21 Aug 2020

LV launches pay-as-you-go car insurance for millennials: how does it compare?

Flow offers monthly contracts, free cancellation and no adjustment fees

One of the UK's largest insurers has introduced a new monthly car insurance subscription aimed at millennials.

LV says its new 'Flow' insurance product will change how younger drivers perceive car insurance, by offering them flexible cover which is easy to apply for and cancel.

Here, Which? takes a look at how Flow works and offers advice on how young drivers can find the best car insurance.

Be more money savvy

Get a firmer grip on your finances with the expert tips in our Money newsletter – it's free weekly.

This newsletter delivers free money-related content, along with other information about Which? Group products and services. Unsubscribe whenever you want. Your data will be processed in accordance with our Privacy policy

LV launches car insurance subscription

LV has launched a new monthly car insurance subscription, which it says offers a 'fuss free' alternative to standard insurance products for younger drivers.

Flow is designed for millennials, who LV says are often frustrated by lengthy application forms and complicated documents.

The product is only available online and applicants can get a quote by answering 14 questions and uploading a photo of their driving licence.

When you apply, you'll be given a fixed price for the first month of insurance and a guaranteed maximum price for the following three months.

What's unique about Flow?

Flow's main attraction is its lack of fees and long-term commitment, which could suit drivers whose circumstances are more fluid.

Customers don't need to commit to a contract and are able to make alterations, such as changing their mileage limits, without needing to pay administration fees.

LV says applicants will always get the most competitive price regardless of whether they are new or existing customers.

The insurer claims that ultimately, Flow is unique as it is a 'genuine monthly subscription product, rather than simply an annual product that customers pay monthly for'.

How does the coverage compare?

On paper, Flow is a little less comprehensive than LV's standard products.

It includes comprehensive, uninsured driver and misfuelling cover, but doesn't allow you to drive other cars or drive overseas.

Hire cars aren't included as standard, although you can add this feature on for £2 a month.

Annual mileage is capped at 20,000 miles, compared with 50,000 on the standard LV product.

Flow and no-claims bonuses

Flow doesn't take no-claims discounts (NCDs) into account when calculating premiums, which is good news for young drivers with little driving history.

Those who are more experienced and have built up NCDs won't enjoy the full benefit, however.

In addition, there's no NCD protection with Flow - unlike in LV's standard policy.

NCD protection allows you to pay a little extra on the premium in exchange for having your NCD protected against a number of claims.

How much does it cost?

When we asked LV how premium costs compare with its standard product, it told us it wasn't able to provide such data.

It instead pointed out how the fees on Flow compare favourably with competitors.

Flow has no amendment fees (compared with £15 on LV's standard product), no cancellation fees (£40) and no monthly instalment charge (24.9% APR).

When Which? analysed 47 car insurance policies in January, we found only a handful came without these charges.

Car insurance for young drivers

Young drivers can face sky-high premiums when they first pass their test, but there are some steps you can take to boost your chances of getting a good deal.

After the cost of the car itself, insurance is likely to be your second biggest outgoing - and the type of car you buy can have a significant bearing on how much you'll pay.

Cars with lower horsepower are likely to be much cheaper to insure than higher-powered models. Before you buy, find some examples of vehicles in your price range and run quotes to get an idea of how much you might pay.

Other ways of cutting the cost of insurance can include adding a more experienced driver as a named driver (but not the main driver) on your policy, considering 'black box' insurance products which track your driving, and paying for the full year upfront rather than in monthly instalments.

Best and worst car insurance

LV is not only one of the biggest car insurers in the UK, it's also one of the best, having been awarded Which? Recommended Provider status earlier this year.

To identify the best car insurers, we combined an analysis of 30 providers' standard policies with feedback from thousands of policyholders to produce our car insurance reviews.

You can also find useful tips in our comprehensive car insurance advice guides and the video below.