Young female drivers are facing an estimated increase of around 24% in annual car insurance premiums, thanks to an EU ruling on gender – including both normal and classic car insurance. Also, as part of the directive, young male drivers are set to see a fall of approximately 9%.
So what is it all about?
Well, from 21st December 2012 the EU made it illegal for insurance companies to differentiate their insurance prices according to gender. This will impact significantly on modern and classic car insurance.
Previously, insurance companies considered young female drivers to be statistically safer drivers. In fact, young men are two times as likely to crash their cars compared to young women. As a result, the “young female” demographic was charged less for insurance.
Young males aged 17 to 25 are statistically 10 times more likely to die, or be seriously injured in a car accident than males aged over 35.
Despite being a statistical insurance risk, the “young male” demographic is set to gain the most from the EU ruling.
On average, young males should expect to see a reduction of around £180 (or 9%) on their annual insurance charges. On the other hand, “young females” should expect to see a rise of around £300 (24%) per year.
Given that the changes are newly introduced, it is currently difficult to understand how insurance companies will react to the EU ruling. Some feel that there is the potential for a volatile reaction within the insurance market.
We will have to wait and see, but it is assumed that young women should prepare themselves for insurance premiums to rise and rise.
Interestingly, there have been negative reactions from both genders.
Younger females are facing the need to raise an extra £300 per year in order to pay for the same level of insurance cover that they previously had. In the current economic climate, for many it will not be possible to raise the extra cash. As a result, they will no longer be able to run a car.
Younger males should be jumping for joy at the prospect of saving almost £200 per year. But the fact remains that the insurance costs will still remain too high. Taking the reductions into account, the average insurance costs for a young male driver will be over £1,800 per year. For many this will change very little and they will still not be able to afford to run a car.
There is a perspective which accepts the argument that you can”t have equality in some areas and not in others.
Perhaps gender should not be an issue in determining insurance, given that it is a positive form of discrimination in the interest of females.
Another perspective argues that insurance is all about risk and that insurance companies should be left alone to manage the premiums according to their own analysis.
I of course have my views! What abbot you? How do you feel about the new rules? Get in touch and let us know what you think.
This article was written and published by Emma Jones. Emma works for Trade Classics as an in-house journalist and copywriter and has many years” experience in the classic car sector. Why not write a reply on this article below – she”d love to hear your thoughts on her thoughts!Google
Tags: insurance, young drivers, young female drivers
Categories: Classic Car Blog, Government Policy