Motor insurance premiums fall for young drivers

Car insurance premiums for younger drivers have fallen for the first time in two years, according to figures released today.

Motor insurance premiums fall for young drivers 

According to the AA's British Insurance Premium Index, the cost of insuring drivers aged 17-21 fell by 5.6pc during the last quarter, bringing the average annual premium to £2,294.

Simon Douglas, director of AA Insurance, said young drivers have for a long time been the biggest losers in the insurance market with premiums driving them off the road.

"Premiums have been rising at a disproportionate rate, but it seems at last that insurers are starting to compete a bit more for their business with rates starting to come down," he said.

Premiums have always been higher for young drivers, due to higher risk or traffic accidents. According to road safety charity Brake, one in five new drivers has a crash within six months of passing a test and newly qualified drivers are more likely to be involved in a traffic accident during the first two years after passing their test.

But it is young male drivers that pose the biggest risk figures from the charity show that 74pc of deaths among young adults are now on the road, and in 2009, more 16 to 19 year-olds died as passengers in cars than those who died as drivers.

Fact 

" Heart Finance is one of the UK’s leading independent finance broker which was founded to search the entire market in order to help you find the best deal you possibly can. We offer a range of  insurance that  are arranged through well established and recognised Insurances and  financial institutions. 

Why should you use Heart Finance Insurance ? 

	We are 100% independent and impartial.
	With our Quick-Click insurance system you can search our growing panel of insurers quickly and easily.
	Your information is stored so you can get new quotes instantly without having to fill everything in all over again. "

However, Mr Douglas warned that with the end of gender-based pricing in December 2012, young women under 25, who typically pay premiums up to 40pc less than their male counterparts, can expect to see a sharp rise in the cost they pay for their cover.

Premiums for the rest of the market have shown signs of levelling off, with the average cost of an annual car insurance premium increasing by 3.6pc over the last quarter to £923.90, the lowest rise for 18 months. However, premiums overall are up by 30.1pc since last year.

"This is the smallest increase we have seen for some time, and I believe that over the rest of this year we will at last see premiums level off, despite the gloomier predictions of other market commentators," said Mr Douglas.

By The Telegraph