Young drivers are once again bearing the brunt of price hikes in the car insurance industry with the the Confused.com/EMB Car Insurance Price Index showing some staggering rises for drivers under 25.
The figures, which look at changes between July and September this year, reveal that 17 to 20-year-olds were hit by the biggest quarterly increase for comprehensive premiums at 10.4 per cent, meaning they now pay on average £2,080 to insure a car every year.
Although this marks a rise of just over 10 per cent since July - less than the previous quarterly increase - this age group now pays a whopping 42.2 per cent more now than at the same time last year.
So, in just 12 months, the average car insurance premium for the UK’s youngest drivers has become £617 more expensive.
Those aged between 21 and 25 also saw a staggering rise in their average premiums between 2009 and 2010, with a jump of £305.
Fully Comprehensive vs. Third Party
If those drivers hope that opting for third party, fire and theft (TPFT) cover will help reduce costs they’re in for another blow. The latest EMB figures show that drivers buying TPFT have faced above-average increases: 11.7 per cent this quarter and 54.2 per cent since October 2009.
The gender gap
Despite premiums for young drivers rising across the board it’s still young male drivers who are forking out extra to insure their motors.
A man aged between 17 and 20 now pays £2,879 for an average insurance premium, while a female driver of the same age will pay, on average, £1,637.
Young men also suffered the biggest quarterly rise with a shocking £283 jump in prices between July and September this year.
Darren Black, head of motoring at Confused.com, commented on the figures: “Young male drivers continue to suffer higher premiums than their female counterparts and there has been recent call for gender bias to be removed.
“It is important to note, however, that women do not pay less for their premiums because of positive discrimination but based on statistical evidence suggesting that, on average, they have smaller, less expensive accidents.”
A glimmer of hope?
While the last year has clearly hit drivers’ pockets hard, EMB partner Peter Lee has offered a lifeline to drivers, saying that prices should start coming back down towards 2011.
“The price corrections that have been taking place over the past year or so have been essential to getting many private motor insurers back on an even keel after poor 2009 results.
“However, the level of increases is starting to slow down, with each month in the quarter showing flatter price rises than the previous one.”
In the meantime, as prices remain sky-high for young drivers, there are some measures you can take to help keep costs down.
Top tips to cut the cost of insurance
- Get discounts on your premium by taking extra safety precautions such as fitting an alarm and immobiliser.
- Choose a car with a smaller engine, as bigger and faster vehicles cost more to insure.
- Avoid vehicles with any modifications from the standard manufacture.
- Make savings by reducing your mileage or by only driving at certain hours of the day.
- Take the Pass Plus qualification to benefit from a reduction of up to a third on your premium.
- Consider lowering the price you pay by opting for a higher excess - but be sure you can still afford this amount in the event of a claim.
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Compare car insurance with Confused.com – half of customers our save up to £185*.
*Based on online independent research by Consumer Intelligence (August 2010). 50% of consumers could achieve this saving.
