Things have never been great for young drivers looking to get affordable car insurance, but figures have now emerged that show it is getting far worse.
According to AA Insurance, the average premium for drivers aged between 17 and 22 has increased by around 80% in the last two years. This is broadly confirmed by the latest car insurance index released by Confused.com and Towers Watson which shows that male drivers under 20 will have to fork out an eye-watering £4006 a year for comprehensive cover.
The increases become even more pronounced when this figure is compared against the country wide average yearly premium cost of £858.
While this disparity in price must seem unfair and confusing to those affected, the insurance industry believes the high premiums are justified for
young driver car insurance. Young drivers are statistically proven to be more likely to have serious accidents, with an 18 year old three times more likely to be involved in a crash. For insurance companies this equates to a higher risk and therefore, to higher premiums.
Young Marmalade and the ‘black box’
There are however a number of innovative companies emerging and offering assistance to young drivers, not least Young Marmalade. The company uses a telematics satellite technology system called Intelligent Marmalade, to calculate its premiums instead of more general calculations.
The ‘black box’ is placed in the car and then proceeds to monitor aspects of the young persons driving; things such as when the car is driven, acceleration, braking times and average speed. These figures are then used to give each driver an individual premium based upon their ability.
Young Marmalade will cancel a young driver’s policy if they continue to drive badly even after facing an expensive rise in premiums.
Despite Young Marmalade claiming the scheme has great success in turning young drivers into more observant and careful motorist, other companies have been more sceptical.
In 2006 Aviva, which was then Norwich Union, withdrew two similar insurance policies due to a low take up rate. This has been blamed on the expensive nature of the black box technology, but others point to the fact that premiums for young drivers cost substantially less then as well.
Other car insurance providers claim to be able to give young drivers great deals on their car insurance using other methods.
Co-operative Car Insurance operates a policy whereby policyholders go through a driving assessment every three months, with those that drive in a safe way gaining discounts worth up to 11%. The company claims that this could result in premiums up to £330 cheaper than most other companies.