Young Driver Car Insurance Really Eats Into Annual Salary
Published: 22 May 2012 By Peter Thompson Leave a Comment
Young driver car insurance can really hit your annual salary hard, with the average annual comprehensive cover costing almost £2,500.
According to the Confused.com/Towers Watson Car Insurance Price Index Q1 2012, young drivers are paying an average of £2,499 for their annual comprehensive car insurance.
When you take the income for 18-21 year olds in the UK, which is £13,972 on average according to the Office of National Statistics, this insurance equates to some 18% of salary.
In complete contrast, driver aged 71+ are paying an average of just £436 per year.
The reason being is that older drivers are considered to be a lower risk as a result of their driving experience, likelihood to travel shorter distances and owning lower-powered cars. These positive influences then out weigh the possibility that their reactions could be slower due to their age.
As Gareth Kloet, Head of Car Insurance at Confused.com comments: “”Each age group is costed by their statistical risk and this includes the value of the car itself, the experience levels of the driver, past history and where they live among other factors.
Younger drivers are hit significantly harder than more experienced motorists but Confused.com is working hard to find ways to help young drivers bring down the costs, such as working with telematics providers who offer a discount for drivers who can prove that they are safe on the road.”
With the help of Confused.com here are some top tips for young drivers trying to reduce their car insurance costs:
- Choose a small and low-powered car
- Consider volunteering to have a telematics device fitted in your car to monitor your driving.
- Shop around to get the best price, using a comparison site such as Confused.com or Quotezone.co.uk
- Consider excess protection. To explain. A higher voluntary excess can cut your car insurance premium. Excess protection allows you to insure this higher excess which means if you need to make a claim and have to pay your excess, you can seek reimbursement from your excess protection policy.
MoneyHighStreet comments: “Whether young or old, with the cost of running a car rising, all need to consider how to save money. There is a real opportunity for young drivers to save money on insurance by opting for a less expensive and indeed less powerful car.
“When you buy cover, make sure buy the cover you need – don’t just opt for the cheapest, it may not be the best for your needs.
“Also don’t be tempted to indulge in any car insurance fraud in order to save money.
“An example of this is ‘fronting’ whereby someone other than the main driver of a vehicle is incorrectly declared as the policy holder. This could be a parent insuring a car and declaring themselves as the main driver in order to reduce the insurance premium, when in fact their son or daughter will be the main user of the vehicle.
“By doing this, motorists are committing fraud and under contract terms, could invalidate an insurance policy. “