Older Drivers Face A Surge In Car Insurance Costs
Car insurance providers have sharply raised their premiums for motorists aged over 50; exceeding the increases faced by other age groups.
The cost of car insurance is rising quicker for over 50s than any other demographic. That’s according to data analytics company Consumer Intelligence. It found that the cost for older drivers had risen by 3.6%; leaving an average premium of £407. This represents a £15 increase from £392. Despise this increase, it’s the youngest drivers who face the most expensive policies. For them, the average policy cost a whopping £1,673. This represents a 3.2% increase over the last year alone. Whilst this increase is behind that of older drivers, it represents significantly more money; demonstrating that experience remains everything for insurers. As a result, more mature motorists pay less despite a fast increase in cost.
Why Is The Cost Of Car Insurance Going Up?
Insurance costs are based on what’s called the ‘Ogden rate’. This is used to determine how much insurers pay out in compensation when drivers experience injuries. Lower rates mean higher compensation and vice-versa. The increases, then, are effectively compensating for a drop of the Ogden rate from 0.75 to 0.25. John Blevins, pricing expert at Consumer Intelligence, has suggested that insurers are pointing the finger at the government for price hikes. He said, “pricing at an overall level will be driven by claims experience and the impact of the Ogden discount rate”. He added, “many insurers feel misled by the government and had planned for a more favourable discount rate being set. As such, premiums are being adjusted to compensate for the cash injections on to claims reserves made by many insurers”.
The fact of the matter, however, is that the extremities of age aren’t popular with car insurance providers. Younger drivers are the most likely to face an accident, largely due to a lack of experience. So it’s not surprising that they face such steep insurance colds. Older drivers, statistically the safest, are perceived (rightly or wrongly) to being to lose their ability as they age. So it’s not unusual for drivers in their 70s, 80s and 90s forking out more for cover; or struggling to find the policies they need. They best way to keep costs down is to avoid finding yourself in an accident in the first place. In other words, drive safely and responsibly and your wallet will thank you for it; regardless of how old you are.
Ten Ways People Accidentally Invalidate Their Car Insurance: https://autoserve.co.uk/motoring-news/accidentally-invalidate-car-insurance/
No So Obvious Ways You Can Save Money On Your Motoring: https://www.autoserveclub.co.uk/blog/save-money-on-motoring/