MSE News: Drivers face soaring car insurance costs

mikey72

dacouch wrote: »

How much would you regard as a small increase ? If they implemented your suggestion it would be likely to increase your (and everyone else's) premium by upwards of £60 per year

Is that a figure out of the air?
If not, what premiums are you basing it on for drivers before and after, and where do the figures come from?

Percy1983

Yes for me it was 2002, as I nearly swore at one insurance company when they said 'did you consider buying something smaller?' it was an 8 year old 1.1 fiesta!

As it is I asked the bloke on my final quote to tick the female box out of interest and it went from £1400 to £850.

My point about discrimination is that in every like for like situation a women will get a cheaper quote than a man which would indicate ALL women are safer drivers than ALL men, which lets me honest we can all say isn't true. There will be women who are worse drivers than me yet pay less for insurance because they don't tick the male box.

Just to quote myself again:
Discrimination is a sociological term referring to the prejudicial treatment of an individual based solely on their membership (whether voluntary or involuntary) in a certain group or category. Discrimination is the actual behavior towards members of another group. It involves excluding or restricting members of one group from opportunities that are available to other groups.

Lets see young males get charged more so that ticks both age and sex discrimination.

If I was to flip this around and insurance companies start measuring the height of people in accidents and figured that all people below 5'7" was more of a risk there would be an uproar how that is discriminating against short people, its not there fault they are short... yet its not my fault I was born in 83 and happen to be male, discriminate away.

dacouch

mikey72 wrote: »

Is that a figure out of the air?
If not, what premiums are you basing it on for drivers before and after, and where do the figures come from?

It's a back of a fag packet calculation.

If you assume there are 300000 drivers who pass their test in a year (There are circa 1m who take tests, so it does not include people who are insured on a provisional licence). There are in excess of 26m cars on the road some of them being government vehicles (Some being self insured) and 1.5m uninsured cars. You would need to help the new drivers for the first and second years of their insurance and I have worked on a subsidy of £2000 per person.

So 60000 x £2000 = £1200000000 then divide that amount by the 25m = £48 levy per car.

It's not an exact science as I'm not an actuary, the rounding up would be to take into account that if young drivers premiums were much lower it is likely to have a detrimental effect on their driving as they some would not worry about the financial impact of their driving on their premiums.

I can't see the general public being happy at paying an extra £60ish on their premiums each year so that young drivers can have cheaper premiums. The obvious exceptions being parents whose children are about to start driving

dacouch

Discrimination happens with Insurance, many people actively benefit from it, for instance someone aged over 30 will be receiving cheaper premiums due to the discrimination so will people with good driving records and people who receive a discount because their occupation is viewed as a lower risk than other occupations etc etc

raskazz

Percy1983 wrote: »

I do agree to lower premiums for new drivers would mean rise for others, but right now it is out of balance, why should a sensible first time driver who has gone and bought a little 1.something cheap car pay 8x what a 35 year old pays for a sports car.

Nothing is 'out of balance'. Premiums are reflective of risk. The reason why a 17 year-old male driver would pay 8x what a 35 year old pays (other things being equal), is because they present 8x the risk to the insurer.

Percy1983 wrote: »

As I say newer drivers may be more of a risk, but they shouldn't be shafted like they are

What do you mean, 'shafted'? Are they being 'shafted' because they pay a premium which reflects the risk they present? If you are implying that insurers are making abnormal profits out of young drivers then please link to your evidence.

I say this every time this topic comes up (along with the inevitable ill-informed posts from people who do not understand the market):

The only way to reduce the insurance premium required to cover young drivers is to reduce the risk that they present. This means reducing the frequency with which they crash, reducing the severity of those crashes, or both. The means by which this is most easily acheived is by the Government radically reforming driving tuition, testing and licensing.

mikey72

This is going to get interesting, when all the old posters on the thread get to the age where we are the 15% having the 35% of the accidents at the other end of the scale, and all the 17 year olds are now on the "it's good for us, stop driving and get a taxi" bandwagon.

raskazz

Percy1983 wrote: »

My point about discrimination is that in every like for like situation a women will get a cheaper quote than a man

That is not actually true though.

Certainly (all other things being equal) young male drivers are a higher risk than young female drivers hence pay a higher premium. For older drivers (mid 50s and above), many insurers rate males as a lower risk than females, and in my experience almost all rate male drivers over 75/80ish as lower risk then females of the same age.

Percy1983 wrote: »

Lets see young males get charged more so that ticks both age and sex discrimination.

'Discrimination' in the pure sense of the word is not a sociolgical term. To discriminate between group A and B is, in the pure sense of the word, merely to distinguish between group A and group B. When people resort to using the word 'discrimination' in the perjorative sense in debates on insurance, generally it means that they do not fully understand risk and how it is assessed.

dacouch

mikey72 wrote: »

This is going to get interesting, when all the old posters on the thread get to the age where we are the 15% having the 35% of the accidents at the other end of the scale, and all the 17 year olds are now on the "it's good for us, stop driving and get a taxi" bandwagon.

I've seen it happen !

One of my old employers I worked at for donkeys years, there were quite a few customers* where I covered them when they were 17 and moaned about the premiums. Plenty of them stayed with us and all of them without fail would then moan about their premiums when they got older eg over 30 and how they should not be subsidising young reckless drivers.

* Back in the day premiums used to be fairly static and the majority of people renewed with the same company

Percy1983

This where my argument lies, how they calculate risk.

I have been classed as high risk all the time I have been driving, I have spent £6000 on insurance and never got a penny back, in that 7 years my dad has had 2 accidents yet still gets cheaper quotes. yet if you go from recent form the stats must say I am the safer driver?

My insurance these days is much more reasonable but I am still treated as guilty until proven innocent because 7 years no claims isn't enough proof I have broken my genetic coding which will is makes me 99% certain I will crash.

As I say let them do what they want with the ones who buy powerful cars, get caught speeding and crash.

Right now it would seem the young sensible ones just pick up the tab for the 'protected no claims' 40+ crashers

Quote

The problem with Mikey, and his ilk, is that they imagine that they're saving money. If you accept a premium of £200 instead of £300 you're not saving £100 any more than you'd be saving £1000. You're still spending money.

And even if you think you're saving £100 every year, that's only £5,000 over a lifetime, or £2 a week. Either way it's a piffling amount of money.

People should be more worried about the week of life they waste on comparison websites.