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Six penalty points adds more than £200 to car insurance

Written by: Emma Lunn
The first three penalty points on your driving licence only make a small difference to car insurance costs – but repeat offences will cost you dear.

Compare the Market studied the impact of penalty points on car insurance premiums. It found that car insurance premiums remain broadly flat if a driver goes from zero to three points on their licence, with the average annual premium increasing just £5 from £700 to £705.

However, if you jump from three to six points, the average premium shoots up by more than £200 to reach £937.

The cost of insurance gets progressively higher the more points are added to your licence, reaching an average premium of £1,009 for those with 12 points.

Research by Compare the Market found that penalty points have added more than £159m to car insurance premiums, with about 2.64 million drives carrying points as of March 2021. This represents just a 3% decrease compared with March 2020 when 2.72 million drivers had points on their licence, despite a year of travel curbs and lockdowns due to the pandemic.

Examination of the DVLA’s figures also revealed that 71% of all penalty points were given to men and 60% of points were given to drivers over the age of 40.

Penalty points for speeding typically stay on a driver’s record for four years, although they are only active for the first three years. Looking at the most recent Department for Transport data available – from 2017 to 2019 – 72% of all penalty points given were for speeding offences in the three years.

A further 12% were given for licence, insurance and record-keeping offences, and 4% were given for dangerous or drunken driving. For more serious offences, such as causing death by dangerous driving or drink-driving, points stay on a driver’s licence for 11 years.

Dan Hutson, head of motor insurance at Compare the Market, said: “Motorists may not realise the long-term cost that poor driving can have on car insurance premiums. Our research shows the increase in premiums is often greater than the initial fine for irresponsible driving.  Drivers will also face the more expensive premiums in each of the four years that the penalty points remain on their licence.

“The cost of car insurance typically rises when motorists receive points as insurers believe this increases the risk profile of the driver. Those with points on their licence are usually considered more likely to be in an accident, and therefore pay more for their policy. Our research shows that drivers aged over 40 are more likely to have points on their licence.

“While we have seen a substantial decline in car journeys because of lockdown restrictions, it is concerning that the number of drivers with penalty points has remained roughly the same as in the previous year. Beyond the obvious safety concerns, drivers should hopefully be incentivised by the financial impact to take care when on the road or risk being charged a significantly more for cover.”

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