Older & Wiser?
Data from the Association of British Insurers (ABI) shows that the average premium for someone aged between 66-70 is just £246. Compare that to the youngest age bracket of 18-20 year olds who pay a humongous average of £993 and you can see that older generations are certainly benefiting from lower premiums.
However, annual premiums for the over 50s have increased by 34% over the last three years and the halcyon days of boasting about having the cheapest car insurance could soon be put to an end if premiums carry on rising as they have. In contrast, the cost of the average policy for 21-24 year olds has risen by a tiny 2.9% – thanks mainly to the popularity of telematics or ‘black box’ technology which monitors new drivers and calculates premiums based on their skills behind the wheel.
So, why are over 50s car insurance premiums rising so rapidly in comparison to other age groups – are older drivers involved in more accidents? Well, that would be an obvious answer, and there have been calls for drivers in certain age groups to re-sit their driving test. But official statistics show that older drivers are no more likely to be involved in a serious accident than they were ten years ago.
The price increases are due to various other factors such as rises in insurance premium tax or IPT, which is automatically added to your policy price, and affects every age group. IPT has risen from an incidental 2.5% to a whopping 10% and in the last autumn statement, it was announced that it was to increase again up to 12%.
Another reason for the rise and rise of car insurance for the over 50s is that people are living longer and therefore driving for longer. And more drivers on the roads means a greater risk of accidents waiting to happen. Increasing premiums seems to be a way of counterbalancing the impact of potential incidents – but this affects all drivers and fortunately older drivers are still considered to be less likely to make a claim, which keeps their premiums lower than others.
Of course, that doesn’t mean you have to sit back and put up with increasing prices in car insurance once you get past 49, it simply means shopping a bit smarter and at comparethemarket.com, we can help you do that. Find out what you should look out for when it comes to comparing over 50s insurance quotes and what you should consider when choosing the perfect policy for you; so keep your pounds in your pocket and start searching today.