One accountancy firm has recently made the prediction that young drivers in the UK are in store for car insurance rate increases of 50 per cent at the minimum.
Mazars has announced that it expects discount car insurance for young drivers to be next to nonexistent by 2013, with the average premium available from car insurance companies estimated to be around £3,600. The firm cautioned that this will most likely have a serious impact on younger motorists, especially those who do not have public transport options.
Mazars pointed to recent figures from the AA that revealed how, over the past 12 months, premiums for young adults had increased by 64 per cent to an average of £2,431. Young women in particular could be hit quite hard as well, it added, due to the recent European Court of Justice ruling banning gender-based pricing.
Mazars insurance industry partner, Craig Scarr, remarked that the car is often an essential component of getting to and from work in many suburban and rural areas, as public transport is not as plentiful in these areas as it is in metropolitan ones. Mr Scarr also said that young drivers are already being priced out of car ownership due to the increased costs of both petrol and insurance, voicing concerns that this will only get worse when the typical premium rises to its expected high of more than £3,600.
Insurance experts stated that the new cost increases would inevitably result in higher numbers of younger motorists driving without insurance. Fraud was expected to increase as well, as other younger people are expected to begin to give false information to car insurance companies in order to reduce the cost of their cover.