Government to consider £1,200 insurance cap for young drivers

The Parliament will discuss whether young drivers should pay no more than £1,200 for car insurance, but other motorists could be worse off

Car insurance

Insurance premiums for young drivers will cost no more than £1,200 if plans to cap premiums go through. The Parliament has agreed to discuss the possibility of limiting premium prices, after a petition demanding price caps for young drivers received over 180,000 signatures. 

The petition wants to cap premiums for drivers aged 18-25 at £1,200. Previous research found young drivers are on average charged £2,013 for a year’s insurance, with many ending up paying significantly more. Meanwhile, the Association of British Insurers estimates the average comprehensive policy costs £462 across all motorists. 

The news comes after the Government announced plans to change personal injury payouts, which are expected to raise premiums for young drivers by up to £1,000. The Chancellor, Philip Hammond, has ordered a review of the plans before they go through, however.

Government to consider car insurance changes

While the price cap would benefit young drivers, the British Insurance Broker’s Association (BIBA) says the rest of the motoring public would be worse off. According to BIBA, the cost of young driver claims would simply then be passed on to other motorists through higher premiums. Instead, the organisation wants to see young drivers spared from the Insurance Premium Tax which will rise from 10 to 12 per in June. 

Car insurance prices hit record-high levels

A spokesperson for the Government said: “We have engaged insurers in this process, so that they can have confidence that additional measures will make a real difference that can be rewarded with lower premiums.”

Should insurance premiums be capped for young drivers? Tell us in the comments below...

Recommended

Smart motorways inquiry launched by MPs
smart motorway
News

Smart motorways inquiry launched by MPs

The Transport Committee will investigate the impact of smart motorways following concerns over their safety and calls for them to be scrapped
26 Feb 2021
Official: E10 petrol launches in September
Petrol pump
News

Official: E10 petrol launches in September

E10 petrol is up to 10 per cent ethanol and will be available at UK fuel stations from September 2021 as part of bid to cut CO2 emissions
25 Feb 2021
VED road tax: how much does it cost?
car tax calculator
Consumer news

VED road tax: how much does it cost?

Confused by VED road tax? Our comprehensive guide explains how much you'll pay on your next car
17 Feb 2021
Councils get £500m to fill 10 million potholes in 2021
Potholes
Consumer news

Councils get £500m to fill 10 million potholes in 2021

The new pothole repair funding is part of a £2.5 billion Potholes Fund that was announced in the 2020 Budget to cover 2020/21 to 2024/25
15 Feb 2021

Most Popular

Volkswagen Golf GTI ‘Edition 45’ anniversary model leaked
Volkswagen Golf GTI 'Edition 45' - front
Volkswagen Golf GTI Hatchback

Volkswagen Golf GTI ‘Edition 45’ anniversary model leaked

The Volkswagen Golf GTI will soon get a new special edition model to celebrate its Sapphire anniversary
23 Feb 2021
'If you invest in a Jaguar now, it’s going to look very out of date very quickly'
Electric Jaguar
Opinion

'If you invest in a Jaguar now, it’s going to look very out of date very quickly'

Jaguar's all-electric announcement has editor-in-chief Steve Fowler wondering what future cars will look like from the British brand
24 Feb 2021
New all-electric Hyundai Ioniq 5 arrives to take on Tesla
Ioniq 5 - front
Hyundai

New all-electric Hyundai Ioniq 5 arrives to take on Tesla

The new Ioniq 5 – the first model from Hyundai’s all-electric sub-brand – takes design influence from the 45 Concept and will be offered with two batt…
23 Feb 2021