MPs to debate insurance price cap for young drivers

  • Petition for £1,200 price cap
  • Signed by more than 180,000 people
  • MPs to debate subject on 20 March 2017
  • Petition for £1,200 price cap
  • Signed by more than 180,000 people
  • MPs to debate subject on 20 March 2017

Calls for a £1,200 car insurance cap for 18-25-year-old drivers will be debated in parliament after a petition on the subject gained more than 180,000 signatures.

The petition was started by a young driver highlighting that the car insurance bill for his first year of driving will be around the £2,500 mark. It has since gained 184,909 signatures at the time of writing and will be debated by MPs on 20 March 2017.

The Government has also provided a written response to the petition, claiming that ‘by strengthening the way that people learn to drive and are tested and by tackling insurance fraud this Government is helping bear down on the cost of insurance for new and inexperienced drivers.’

You can read the Government response in full at the bottom of this page

Young drivers could save 66% on their car insurance with black box telematics

Many 18-25-year-olds could slash thousands off their car insurance bills with black box telematics insurance.

By fitting a little black box to your car, the insurer will track how you’re driving, and – provided you’re careful on the roads – could provide you with heavily discounted premiums.

For example, we compared the cheapest quotes on the mustard.co.uk insurance comparison site for an 18-year-old driver named Adam.

Without counting policies that required a black box, the cheapest premium we found for Adam was a seriously hefty £2,861 – or £4,008 when paid over 12 months. However, when including black box telematics policies in the search we managed to get Adam’s insurance down to just £931 – or £1,018 with payments spread over the year. 

Read our full article on black box telematics here

Government response in full

‘Motor insurance premiums can vary according to the risks associated with different types of driver, vehicle and other factors such as age and driving experience. Motor insurance is a very competitive market and shopping around for the best possible option before making any decisions is likely to benefit customers.

‘The British Insurance Brokers Association (BIBA) run a not-for-profit ‘find a broker’ service where there are many broker products for young drivers. Further information can be found on their website: www.biba.org.uk

‘New rules coming into force next year will require motor insurers to disclose last year’s premium at renewal and prompt customers to shop around for the best deal.

‘Some insurers have introduced the use of telematics or in-car black boxes to allow better risk-based pricing for new drivers. It means insurers now have a real-time data feed, which allows them to see an individual’s driving behaviour, which had not been possible in the past.

‘There is some evidence that suggests new drivers could see their annual premiums fall by 20% or more if they show good driving behaviour with a black box installed in their cars.

‘The Government recently announced reforms aimed at tackling the continuing high number and costly whiplash injury claims that were having a negative impact on the price of motor insurance premiums.

‘These reforms will end the cycle in which motorists pay higher insurance premiums due to minor, exaggerated and fraudulent whiplash claims by others. The government fully expects insurers to pass on the savings from these reforms to consumers through lower premiums and leading insurers have already committed to do this.' - Department for Transport

Insurance aggregator backs government efforts to reduce premiums

Tracy Miller, Marketing Director at mustard.co.uk comments that, 'car insurance is expensive for all new drivers, but for young drivers, high insurance premiums are particularly challenging as the cost of insuring a car can be crippling and of course the wider implications of not being able to get on the road can restrict where they’re able to work, or study.

'We’re supportive of the steps the government is already taking to tackle the wider challenges around rising car insurance premiums but with average premiums hitting record highs last year, shopping around and comparing car insurance prices has never been more important for UK drivers.'

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