Young drivers see costs rise
On average, a 17-24-year-old driver will now pay £2,381.55 to run a car in the first year after passing their test, of which more than half (£1,348.37) is the cost of insurance cover.
The past year has seen a fall in fuel prices after sharp rises the previous year, but the average £61 fall in annual fuel costs is largely cancelled out by the continued rise in insurance costs – up £41 over the year. While the overall cost of running a car for a young driver has remained flat over one year, it has risen 8.17% over a two-year period.
The research shows young drivers have been disproportionately affected by changes to government policy, including the Insurance Premium Tax and the Ogden rate. Car insurance costs for this age group have increased by over £200 since January 2015, to an average of £1,348 over the past six months.
Simon McCulloch, director at comparethemarket, said: “With an average annual cost of £2,381, getting on the road is simply not an option for many and increasing costs will only price more people off. The cost of insurance remains the single biggest cost for young drivers.
“New government proposals to restrict driving licences for young people in order to reduce accidents, could go some way to reducing insurance costs. The “graduated driving licence” would ban driving at night for a two-year period after someone passes their driving test. The proposals would likely reduce the risk profile of young drivers and ultimately the premiums that they pay.”
|Cost of running a car (17-24 year olds)|
|Cost name||Cost||% of total cost|
|Estimated VED (Road Tax)||£115||4.83%|
|Total cost per year||£ 2,381.55||100%|