Young drivers face car insurance price hike
As reported on the BBC website young drivers have been hit the hardest when it comes to paying for their car insurance, with some young people facing premiums of nearly £3,000, which is by far the highest car insurance costs on record according to data.
A well known insurance comparison firm, said on average 17-20-year-olds had seen insurance rise by more than £1,000 from the same time last year.
Overall, this equates to paying 58% more on car insurance compared with last January.
The aggregator site blamed a post-Covid increase in claims and higher costs as told to BBC Radio 4 programme: "The frequency in claims is up in the last couple of years, since the pandemic, but also the cost of claims has risen.
"The cost of second-hand cars is higher than they used to be, the cost of parts, the cost of labour to make repairs - and that's all being passed onto consumers."
Prices for second-hand cars - the usual first vehicle for a newly-qualified young driver - have been volatile since a few months into the Covid pandemic.
Demand for used cars spiked as production of new vehicles fell because of a global shortage of computer chips and other materials needed for manufacturing.
In March 2022, price increases in the used car market peaked at 31%, according to the Office for National Statistics. They have since fallen back sharply.
According to the aggregator site the average price rises for car insurance across all drivers rose by £366 to £995. But younger drivers faced the sharpest jump.
For 17-year-olds, premiums surged by an average £1,423, to £2,877. For 18-year-old drivers, the average policy price reached £3,162.
The data is calculated on an average of the best five quotes received on the aggregator platform rather than prices that were actually paid for the policies.
The Association of British Insurers (ABI) said while car insurance could be expensive there were ways to bring costs down.
It added that it was important that motorists never drove without cover and urged anyone struggling with costs to speak to their insurers.
However, the ABI said insurance is always based on risk and its data showed the average cost and frequency of claims is higher for younger drivers, which can impact premiums.
According to the ABI's own analysis of 28 million policies, drivers' insurance costs rose between July and September by an average £561, up 29% compared with the same time in 2022.
The association said the figures were based on the price customers paid for their cover rather than what they were quoted.