High insurance rates for youngsters

[Gareth]

How about young drivers being insured on a six monthly basis, starting with the assumption that they are no more risk than any other driver. If they then make a claim, or commit a serious motoring offence like DWDCA, DD etc. then their insurance triples upon renewal.

Seems like an interesting approach - I'd suggest doing it slightly differently: insurance contract for a year but charged in advance a month at a time. If the risk turns out to be larger than the initial calculation, (claim, fault accident, motoring offence, etc.),then the remaining monthly premiums rise dramatically.

Okay, where do I start.

Start by explaining why it's necessary for a teenager to have full-time use of a car. Of course now that I'm a cantankerous old git I can relate how lucky I felt to have my first car at 22, beating my mother by 10+years. Since it was worthless, (purchased for £115 using a cash advance on my credit card), I insured it TPF&T since it was then about half the cost of comprehensive. I remember most of my peers of that time and earlier walking, cycling, getting a moped or motorcycle or using public transport (where available).

[jcochrane]

I think my first insurance was only third party and it was probably not until I was in my late twenties or early thirties that I could afford a car that was worth getting fully comp. insurance on.

[dombooth]

Okay, where do I start.

Start by explaining why it's necessary for a teenager to have full-time use of a car. Of course now that I'm a cantankerous old git I can relate how lucky I felt to have my first car at 22, beating my mother by 10+years. Since it was worthless, (purchased for £115 using a cash advance on my credit card), I insured it TPF&T since it was then about half the cost of comprehensive. I remember most of my peers of that time and earlier walking, cycling, getting a moped or motorcycle or using public transport (where available).

For me, it isn't practical to use a parents car, as one is a van, and the other is a 4x4, so insurance even as a named driver is too expensive.

Using public transport just wouldn't work for me.
To get to work by car takes 12 minutes on a good day. By bus it would be over an hour.

Dom

[Gareth]

Using public transport just wouldn't work for me.
To get to work by car takes 12 minutes on a good day. By bus it would be over an hour.

How about by cycling or on a moped or motorbike?

People tend to choose jobs taking into account their transport options. What you appear to be saying it that you chose a job that requires you to use a car, and then you bemoan the cost of doing so. Did you think about transport costs before you accepted the job? Could you have got a lower paying job that was nearer to home, maybe resulting in more disposable income but a less mobile lifestyle? Isn't this all about choices and consequences?

[waremark]

I remember most of my peers of that time and earlier walking, cycling, getting a moped or motorcycle or using public transport (where available).

The disadvantages of not being able to drive are quite disproportionately greater for rural dwellers.

Personally, I am not happy about young adults being priced out of legal driving. I accept that it is 'fair' in the sense that their premiums are an accurate reflection of risk levels but that does not make it desirable. It represents a substantial reduction in a key aspect of living standards, and a reduction in personal mobility is probably also damaging to the economy.

I don't have a good solution. I do not support subsidy either by other drivers or by the state. I would like to see better control of insurance claims, compulsory further driver training within a certain period after passing the novice test, and compulsory traffic safety courses in schools focused on developing better attitudes to safety. (My three children, now 25, 24, and 21, who have all driven from 17 have not cost their insurers anything.)

I don't understand why it is legally permitted to price on the basis of age, but not on the basis of gender, although each is strongly associated with insurance risk levels.

[Gareth]

The disadvantages of not being able to drive are quite disproportionately greater for rural dwellers.

It's not about not being able to drive; rather, it seems to be more about having (or not having) full time use of a car.

It's always been the same for rural dwellers; it's just that we've all come to expect greater mobility as a right.

It used to be that people living in the country would tend to find jobs relatively close by or failing that would find a job in an urban area and move there.

When I was young, living with my parents at home, travelling 15-30 miles to the next town was a relatively rare occurence. In recent years I've often done the same distance on a daily basis and thought of it as normal. I know others travel much greater distances on a daily or regular basis, something that was less common many years ago.

Hyothetically speaking, if I was more constrained (wasn't able to drive to work) I'd need to look for work closer to home, which would have a knock-on effect on the range of jobs available to me.

Expectations have changed - should we complain about it or accept the good and bad consequences? Where should the line be drawn?

I am not happy about young adults being priced out of legal driving. [...] It represents a substantial reduction in a key aspect of living standards

Isn't that the wrong way around? Doesn't it represent a constraint on the rate of increase of living standards?

[jameslb101]

I am not happy about young adults being priced out of legal driving. [...] It represents a substantial reduction in a key aspect of living standards

Isn't that the wrong way around? Doesn't it represent a constraint on the rate of increase of living standards?

Not really, as society has adapted to our increased mobility (loss of high street and rise of out of town retail parks being one example).

[watts93]

I don't understand why it is legally permitted to price on the basis of age, but not on the basis of gender, although each is strongly associated with insurance risk levels.

I find this the least fair and have no idea how it can be justified. The most irritating thing for me is my parents car's are insured for anyone over 25 who has held their licence for over a year. Can a 24 year old with 7 years of accident free driving really be a higher risk than a 25 year old with 1 year of experience?

[waremark]

I am not happy about young adults being priced out of legal driving. [...] It represents a substantial reduction in a key aspect of living standards

Isn't that the wrong way around? Doesn't it represent a constraint on the rate of increase of living standards?

Not really, as society has adapted to our increased mobility (loss of high street and rise of out of town retail parks being one example).

I was thinking in terms of the reduction in the proportion of people who learn to drive as teenagers.

As an aside my 21 yr old daughter is working as an intern in France. Everyone in her student flat share has their own car as does each of her four fellow interns where she is working - which is on an industrial estate not accessible by public transport. Do foreign insurers take a different view?

[jont]

It's always been the same for rural dwellers; it's just that we've all come to expect greater mobility as a right.

It used to be that people living in the country would tend to find jobs relatively close by or failing that would find a job in an urban area and move there.

When I was young, living with my parents at home, travelling 15-30 miles to the next town was a relatively rare occurence. In recent years I've often done the same distance on a daily basis and thought of it as normal. I know others travel much greater distances on a daily or regular basis, something that was less common many years ago.

Hyothetically speaking, if I was more constrained (wasn't able to drive to work) I'd need to look for work closer to home, which would have a knock-on effect on the range of jobs available to me.

Going back to a rant of mine a couple of weeks ago - cost of housing is now a major problem. If you can't afford your own house (and are therefore stuck living with parents), then you may well have to commute longer distances to get to work. And even if you do own a house, the stupidity of the stamp duty system often means it would be prohibitively expensive to move nearer your location of work.

[gannet]

Using public transport just wouldn't work for me.
To get to work by car takes 12 minutes on a good day. By bus it would be over an hour.

Dom

try living & working closer to london, it's completely flipped:

If I drive it can take at least 1.5 hours EACH WAY...

I take the train and cycle for 8+ miles each way - and it still takes an hour and ten minutes each way...

so get yourself on the bus

oh and I too didn't get my own car until I graduated 21+ years old, up to that point it was cycling and borrowing my parents cars - or the bus...

[dombooth]

Using public transport just wouldn't work for me.
To get to work by car takes 12 minutes on a good day. By bus it would be over an hour.

How about by cycling or on a moped or motorbike?

People tend to choose jobs taking into account their transport options. What you appear to be saying it that you chose a job that requires you to use a car, and then you bemoan the cost of doing so. Did you think about transport costs before you accepted the job? Could you have got a lower paying job that was nearer to home, maybe resulting in more disposable income but a less mobile lifestyle? Isn't this all about choices and consequences?

I will never ever have another moped/motorbike. Unless you are breaking the speed limit most of the time I don't see it as safe. I had far too many near misses on my moped from other car drivers.

I'm self employed as I couldn't find a job.

Dom

[dombooth]

Using public transport just wouldn't work for me.
To get to work by car takes 12 minutes on a good day. By bus it would be over an hour.

Dom

try living & working closer to london, it's completely flipped:

If I drive it can take at least 1.5 hours EACH WAY...

I take the train and cycle for 8+ miles each way - and it still takes an hour and ten minutes each way...

so get yourself on the bus

oh and I too didn't get my own car until I graduated 21+ years old, up to that point it was cycling and borrowing my parents cars - or the bus...

Too many hills to cycle round here, I'd need a shower installing in the shop! :p

The buses are ridiculous, two busses to go 6 miles, not suitable.

I also do home visits/ call outs. I can't do those on a bus/bike unfortunately.

Dom

[Nikki]

Clearly, younger drivers are a high risk but it's okay to 'discriminate' against them by levying a higher charge when their age is rather beyond their control too.

It isn't their age which is directly the problem. Rather it's the lack of driving experience coupled with a lack of concentration, a willingness to be distracted, the unconscious incompetence of believing they are skilful drivers, a belief that speed of reaction fixes everything, and a belief in personal immortality that make them a high risk.

But it is the problem! You have listed all the reasons why it is!

[Nikki]

It's perhaps worth pointing out that car insurance premiums for all of us would be a lot lower except for the blame culture we now live in. Very minor collisions which might cost a couple of hundred quid (even at the inflated prices that the "approved" garages can charge) to sort out, now cost thousands in often spurious whiplash claims and excessive charges for hire cars: there are even gangs making huge profits out of it by engineering rear-end shunts.
As far as the original post and some of the replies are concerned, yes, the insurance industry is driven by statistics so high premiums for drivers more likely to claim are fair.
Jont makes a good point re. uninsured drivers.

Yes he does - I hadn't realised that it could be cheaper for youngsters to be uninsured.