Buying a car, insuring it, and keeping it running is expensive – there doesn't seem to be any way around that. However, there are ways for smart, safe drivers to save themselves money. Take, for instance, telematics insurance from Coverbox.
With telematics, driving responsibly throughout the duration of your policy will mean you could get the best possible price at renewal. This makes a black box device the perfect option for any young driver's insurance.
And recent figures released by a top comparison site suggest that any method of saving yourself money is a worth pursuing.
Car insurance on the rise
Confused.com has released the Car Insurance Price Index for the first quarter of 2017, revealing that motorists have paid an average premium of £781 from the beginning of the year up to March. This means that prices have risen by an average of £110 – or 16 per cent – over the last year.
The Price Index is labelled as the most comprehensive study of car insurance prices in the country, looking at more than four million car insurance quotes. The report also mentions that prices are unlikely to drop in the near future.
The highest premium figures were recorded in 2011 (when they peaked at an average of £858), but Confused.com's motoring editor, Amanda Stretton, thinks that figure could soon be surpassed if prices continue to rise at recent rates, possibly crossing the £1,000 mark by 2018.
Why is it happening?
There are a few reasons thought to be behind the increase. One is because technological advancements have meant cars are becoming very expensive to repair. As a spokeswoman from Confused.com said, "A prang on a bumper is now not only a piece of plastic to be replaced, but a cacophony [sic] of sensors and cameras."
Another change involves how pay-outs for car accident compensation claims are calculated. The Ogden rate, which is used to calculate the amount personal injury victims receive for future losses, has been altered so that they get more. Because insurers have to pay more for victim's injuries, they must offset the costs by increasing premiums.
The government will also raise the Insurance Premium Tax from 10 per cent to 12 per cent in June (making it the third increase since November 2015).
Which drivers are most affected?
Unsurprisingly, age is a large factor in determining how much drivers pay, with young drivers still having to fork out the most.
For 17-year-olds, the average premium increased by 11 per cent to £2,121 (£202 more than they were paying last year) and 18-year-olds, despite seeing the lowest increase percentage-wise, pay more for their insurance (avg £2,164) than any other age group.
When it comes to prices by region, it's London drivers who still have the most expensive policies, with those in East London seeing their premiums by 16 per cent to £1,514.
It's not much of a surprise that London drivers are among the worst affected, as the bustling city of London is a very high-risk environment to drive in. (A recent list of the most difficult places to take your driving test saw areas in the capital dominate the top ten.)
At a time when, for most people, being a driver is only getting more expensive, it would seem that black box insurance is a great option for all young drivers who wish to keep costs as low as possible.
What are your thoughts on the car insurance price hikes? Tweet at us using the #insurancepremiums.
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