Car insurance: Younger drivers pay more 'due to higher risk'

Monday, 04 May 2009

Young drivers may not pay cheap car insurance premiums because they are at a higher risk of being involved in an accident, it has been stated.

Malcolm Tarling is a spokesperson for the Association of British Insurers and commented following the publication of the equality bill, which aims to stop age discrimination when calculating cover prices.

He said it is not a given that older people should pay more and age should continue to be used as a factor by insurers because it is often "very relevant" when calculating risk.

Motor insurance, for example, tends to cost more for younger motorists "because statistically speaking" they are more likely to get into an expensive collision or incident.

Without information such as age, there is insufficient data to enable companies to assess risk, Mr Tarling explained.

"You take away a particular rating factor such as the use of age, then it is going to be forcing insurers to almost operate with one hand tied behind their back," he remarked.

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