"The peak time is a night and we charge £1 per mile on that between 11 at night and six in the morning," explained Erik Nelson, the general insurance media relations manager of the company.
"If young drivers use it between 6am and 11pm [off-peak], that will give them a very low rate per mile, because young driver accidents during the day tend not to be that much different than other drivers."
Mr Nelson added that pay as you drive schemes puts young people in more control of their finances.
Norwich Union is part of the world's fifth largest insurance group, Aviva.
The company offers consumers life and pension products, long-term savings and insurance policies.
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