Insurers must offer incentives for lower risk young drivers
AA Insurance director Simon Douglas will tell the Association of British Insurers (ABI) conference today that insurers should reward efforts by young drivers who improve their driving standards.
Not all young drivers should face such high insurance costs, he will argue. “The records speak for themselves. One out of every five young drivers suffers a crash within their first year of driving and young drivers are 10 times more likely to be involved in a serious collision than experienced drivers.
“But that doesn’t mean all young drivers are reckless or careless when behind the wheel. I believe the industry must work together to find a formula that recognises those who are able to demonstrate they take a responsible approach to driving.
“This has been talked about for years and it’s now time for action.”
Joint efforts with police
A joint AA/police scheme targets at-risk drivers who are offered free driver safety training. Police identify young drivers whose record (such as speeding, mobile phone offences, not wearing seatbelts) suggests they are a danger to themselves and others and puts them forward for Drive Smart training courses developed by the new AA Charitable Trust and AA Driving School.
The scheme was launched last month in North Wales and is being rolled out to other police forces. The Trust will be funding at least 2,000 free courses across the country.
Reduced competition
“Good, safe drivers should be rewarded and the insurance industry is well placed to provide incentives that encourage responsible driving. Of course, young drivers eventually become experienced and less risky drivers and can become loyal customers, yet many insurers won’t offer cover for drivers under 21 or even 25. This is reducing competitiveness in this sector, which is in turn driving up premiums and therefore encouraging fraud, such as fronting, which has become a significant issue for the industry.
“Perhaps it’s time for greater investment in targeted driver training at a younger age to enable new drivers get on the road safely and responsibly, help reduce claims and make insurance more affordable.”
