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140,000 sign petition to curb young driver insurance costs: top tips

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Written by: Paloma Kubiak
08/12/2016
More than 140,000 people have signed a petition calling for a maximum insurance cost of £1,200 for young drivers.

In the three months since it was submitted, 142,000 have added their signature to curb car insurance costs for young drivers aged between 18 and 25. Once any petition accrues more than 100,000 names, it must be debated by parliament.

It was created by Rhys Micheal Parker who stated that he’s looking at a £2,500 insurance cost for his first year of driving which is “completely unaffordable”, especially as he’s earning a minimum wage of £5.30 per hour and has to consider his property bills.

Cheapest premiums are rising

According to comparethemarket.com statistics, the average premium for a 17-24 year old was £1,237.35 in September 2012, peaking at £1,326.98 in February 2013 before coming down slightly. The lowest was in June 2014 when the average premium stood at £1,098.43, but since October 2015 there has been a noticeable rise, correlating with the insurance premium tax hike from 6% to 9.5% from 1 November 2015.

It now stands at £1,257 on average, more than double the national average for car insurance policies. For those aged 25+, the average is £501.90.

The comparison site research showed that even the cheapest premiums on the market are at an all-time high, following significant price rises at the turn of the year.

The average cheapest premium currently stands at £1,005 – a £113 rise on the previous year.

Savvier and more price conscious drivers stand to save £251 on average per year by switching car insurance provider, reducing their premiums closer to the £1,000 mark.

Simon McCulloch, director of insurance at comparethemarket.com, said: “The cost of running a car is already a serious burden for younger drivers and stops many from getting on the road. In our last report, the low price of oil slightly offset the rising price of insurance but now, as oil and petrol prices rebound, young drivers are paying the price.

“However, there is hope for those who take the time to search out the cheaper options: the £250 average saving on offer could make all the difference, potentially enabling people to get behind the wheel for the first time.”

Top tips for under 25s to cut insurance costs

Think about the make and model: Comparethemarket.com found 17-24 year olds could save an average of £320 on insurance by choosing different cars. A Vauxhall Corsa is the most popular car among young drivers, accounting for nearly a quarter of car enquiries and costing on average £1,336. The Fiat Punto ranks as the cheapest popular model, with the average value standing at £895. The Volkswagen Up! hits the spot as it’s the cheapest cars to insure, with an average premium of £849.

Compare quotes: Use price comparison sites such as comparethemarket.com, moneysupermarket.com and gocompare, but check other sites that they miss, such as Direct Line.

Improve your driving skills: Moneysupermarket suggests taking The Pass Plus course which is open to drivers for the first year after passing their test. It covers aspects of driving that weren’t included in the test, such as night time and motorway driving. Check with an insurer to see if it offers a discount if you’ve taken this course.

Add a named driver: Fronting, which is when a more experienced driver (usually a parent) claims to be the main driver of a younger motorist’s vehicle to get cheaper insurance premiums is illegal and a form of insurance fraud. But by adding another person like a spouse or parent to your policy as a named driver could reduce insurance premiums significantly. Gocompare.com found that by adding a 50-year–old driver who has no claims or convictions to a 17 year old’s policy, the total premium dropped by £345.

Pay annually: This may be harder to do for cash strapped young drivers, but if you can, pay annually in one instalment rather than monthly as insurers typically charge interest to spread your costs monthly.

Consider a higher voluntary excess: You can reduce the cost of cover by offering to pay a higher voluntary excess – that is the amount you pay towards the cost of any claim. Moneysupermarket cautions that if you are going to do this, keep in mind that after a certain level of excess, the cost of cover doesn’t change. Plus make sure you can afford the level of excess set.

Counterlogical, but go fully comp: A common misconception is that third party only is cheaper than comprehensive cover, but in many cases this isn’t true – fully comprehensive cover could even be cheaper than a third party only policy. This is because, some insurers may view those looking for comprehensive cover as caring more about their vehicle and therefore more likely to be careful on the roads. Gocompare estimates it could save you about £200.

Telematics or ‘black box’: The technology could lower the cost of car insurance for young drivers. A transmitter is installed in your car and it maps your driving style so it can base the price of your premium on how you actually drive, rather than using calculations of people in your age group. Moneysupermarket said this approach is viewed as “a fairer way of pricing policies and has seen many young drivers having their premiums significantly reduced”.

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