MPs consider insurance cost cap for young drivers

MPs consider insurance cost cap for young drivers

A parliamentary debate is taking place to decide whether car insurance costs for drivers between the ages of 18 and 25 should be capped at £1,200 a year.

The debate comes after an online petition that was signed by 185,000 people.

As per governmental policy, e-petitions with over 100,000 signatures have to be considered for a debate in Parliament.

The debate follows rising insurance costs, largely as a result of a government adjustments to injury compensation regulations.

These adjustments mean that insurers will have to pay out more to accident victims, therefore they will need to raise premiums to cover the extra expense.

19 year-old Rhys Parker, who started the e-petition, said that it was becoming increasingly difficult for young people to start driving.

The teenager, from Lowestoft in Suffolk, said he was quoted £2,500 in his first year of driving, however he was able to get this down to around £1,400.

“That’s very much basic insurance,” he told the BBC.

“I think it’s ridiculous. Young people just don’t get the help they need.”

Recently it was revealed to MPs that the average cost of car insurance for a 17 to 20-year-old driver is £3,878 a year.

E-petition debates are for discussion only, so MPs will not have the power to introduce any limit on premiums.

The debate will be opened by Steve Double, the Conservative MP for St Austell and Newquay.

“I don’t support the cap, but I do think we should be doing more to help young people,” he said.

“The reason premiums are high is that young people have far more accidents.”

As part of their response to the petition, the government said that reforms to whiplash rules would result in lower premiums.

Consumers were also advised to shop around, and look for cover that includes a black box; these give insurance companies more data, and can lead to discounted premiums.

Accountancy firm PwC has estimated that the average cost of car insurance could rise by between £50 and £75 a year as a result of the changes to injury compensation rules, with young drivers having to pay up to £1,000 extra.

The government has promised to review the new injury compensation rules as a matter of urgency.

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