Young women feel the sting of higher car insurance premiums

April 29th, 2013 in Car Insurance Advice


Back in January I looked at the state of the car insurance industry in the months leading up to the EU Gender Directive. Three months on, what’s changed? Now that gender is no longer a factor when working out car insurance premiums, are young female drivers’ prices going up?

All figures quoted here are averages taken from the latest car insurance price index from Confused.com and Towers Watson (January – March 2013), and are based on an annual comprehensive policy. “Young drivers” refer to drivers between 17 and 20 years of age.

Gender neutrality, but at a cost:

As it was feared in the lead up to the Gender Directive, young women’s premiums have gone up, and are the only ones to be stung with an increase. Young women paid £2,256 in premium, almost £500 more than at this time in 2012 (+20.7%).

The statistically riskier guys, however, have had a reduction of about £100 since Christmas (-3.8%), bringing their prices down to £2,848. Young ladies are still paying less than men, but the gap has narrowed considerably.

Most expensive areas for young women:

Aside from your age, where you live can have a significant impact on how much you pay for your car insurance. As you would expect, drivers in the larger cities are more at risk of having an accident or becoming a victim of car crime, and so this is reflected in their premium. Young women in Inner London and Manchester, for example, paid in excess of £3,000, more than double on average that of those in most of Scotland.

Here are the top five most expensive areas for young women:

City

Premium

Inner London

£3,806

Manchester / Merseyside

£3,705

Leeds / Sheffield

£2,967

West Midlands

£2,714

Outer London

£2,708

In the past three months alone, the average premiums for young female drivers in Inner London have risen by 12.5%, meaning that an 18-year old working for minimum wage (£4.98 an hour according to Gov.uk) needs to work an extra 83 hours each year to pay for the increase.

Unsurprisingly, Inner London shows the highest premiums for all female drivers, so no matter what age you are, the capital is the most expensive place to drive.  What is interesting is that the regions with the lowest price (representing the lowest risk) for women changes from the Scottish Borders to the South West once drivers hit their mid-thirties (£377 and £328 respectively).

How can I stop it?

With the effects of the Gender Ruling still being felt, there’s a chance that prices for young women could go up even more as insurers find the right balance between male and female drivers. Sadly, there’s little that can be done about this, and factors such as your age and location are just as difficult to influence.

With that in mind, here are some tips that could help keep your costs as low as possible:

·        Upgrade your security – Installing an engine immobiliser or a tracker to your car should reduce the chances of it being stolen, which in turn could lower your premium.

·        Lower your mileage – How far do you drive each year, realistically? Some drivers tend to overestimate their mileage in order to play it safe, but this risks increasing your premium needlessly. Accurately work out your annual mileage; hopefully the number will go down and your premium with it. Likewise, don’t underestimate for the sake of a lower premium, as this could invalidate future claims.

·        Occupation  How would you describe your job title? What’s the difference between an office worker and an office administrator? You’d be surprised at how the slightest change in description could change your price, so always go for the most accurate job title where possible.

 

Jamie Gibbs is the motoring blogger for young women’s car insurance comparison site Confused.com, where he also writes about fitness and thrifty tips.