Teenagers Car Insurance

[greengu11]

Teenagers are rightly assessed as high risk and have to pay more for insurance. If they don't like it, they can get the bus - it's not a god-given right to be able to run a car cheaply.

Why moan about spending about £4k++ per year running a car (depreciation of the car, tax, insurance, petrol, servicing etc) when using public transport (including taxis - you can get a lot of taxis with £4k) will end up cheaper?

It's simple economics - if you don't like it, don't pay it. There are very few people who really can't get by without their own car.

Fair point, if you live in an area where there are regular public transport services, however, some are not so fortunate as to step out their front door onto a bus or train, even taxis can be impossible to access in some areas, so put a bit more consideration into the issue before quoting stats.

 

[Simster]

So, when you passed your test, how did you prove you were better than other drivers? The only way is through your year on year driving experience and as you got older your premiums should have got lower and your no claims discount higher. And what exactly do you mean by 'fairly' safe. Have you had a fault accident and if so was it in your earlier years as a motorist or more lately?

I didn't prove I was a better driver. When starting out as a teenager, all I'd ask from insurance companies is that they decide whether I'm a good or bad driver based on my future experience rather than comparing me to the chavs in their sooped up Novas on Southend promenade when the truth is that I'm far more likely to drive like my younger sister. I'm "fairly safe" because I've never ever caused an accident. Maybe I should have put "safe".

 

[drew]

Oh right. So presumably it would OK for insurance companies to charge more to black drivers or whatever if it is statistically proven that they are more likely to get broken into and have the contents of their cars nicked?

In theory, yes. But in reality, the reason for the greater number of thefts is unlikely to be due to the ethnicity and more likely down to location. ie. if you live in the inner city then you are more likely to have your car broken into than if you live in a little village somewhere.

 

[drew]

I didn't prove I was a better driver. When starting out as a teenager, all I'd ask from insurance companies is that they decide whether I'm a good or bad driver based on my future experience rather than comparing me to the chavs in their sooped up Novas on Southend promenade when the truth is that I'm far more likely to drive like my younger sister. I'm "fairly safe" because I've never ever caused an accident. Maybe I should have put "safe".

So you are a safe driver, accepted.

With regard to asking an insurer to decide on your ability based on your future experience, how the hell are they supposed to do that. Should there be a question on the proposal form as to whether you think you will be involved in an accident over the next 12 months. Are they to wait until you've had an accident and they say well this should have been the premium for the year then. It's ludicrous.

 

[Simster]

In theory, yes. But in reality, the reason for the greater number of thefts is unlikely to be due to the ethnicity and more likely down to location. ie. if you live in the inner city then you are more likely to have your car broken into than if you live in a little village somewhere.

So you want to put caveats in for racial discrimination because you have to look much deeper for the actual reasons why it might happen, yet it's OK to just charge a much higher rate for males, even though that is blatent sexual discrimination?

 

[sten_super]

Oh right. So presumably it would OK for insurance companies to charge more to black drivers or whatever if it is statistically proven that they are more likely to get broken into and have the contents of their cars nicked?

This is the nub of the recommendation that was given to the ECJ as a precursor to this ruling; that discriminatory pricing should not just be based on statistics but have some reason behind it. For example if you undertook a study which said that Asians are involved in 10% less accidents than White British people you shouldn't simply set the premiums 10% lower without some understanding of why this is the case (and proof that it is not simply a statistical anomaly). The problem is that, in the case of male vs female, there is plenty of evidence as to why men have more accidents.

Meanwhile, I'm still waiting for the great sages of NSC to tell me why it will absolutely be the case that the cost of insurance will rise overall if this ruling takes place. Because that sounds like bollocks to me.

The supposition is two-fold. First of all, insurers will not be sure exactly how to price the combined premium, and will err on the side of caution (which for them means higher prices). This is because they are unsure of people's willingness to pay the new premium rate, and they are unsure of the effects of the price movement (for example, if a male teenager's insurance is suddenly c£200 cheaper, will he spend that £200 on a new/souped up car, thereby increasing his risk still further?). In the long run, insurers seek to profit maximise, and this means draining as much as possible from the driver. Teenagers of both sexes tend to be very keen to get insurance and go out and drive (due to a combination of the newness of being able to do so and in many cases mummy and daddy picking up the tab), and are therefore probably more likely to pay over the odds to do so.

The insurance market isn't really that competitive (smaller specialist insurers aside). There's plenty of scope for profit maximising from individuals.

 

[Lady Whistledown]

Oh right. So presumably it would OK for insurance companies to charge more to black drivers or whatever if it is statistically proven that they are more likely to get broken into and have the contents of their cars nicked?

That's a ridiculous argument as higher crime rates are based on geographical not ethnic factors. And yes, people living in high crime areas pay more but that's because they're more likely to claim not because they're black or Asian or whatever. All insurance, in any category, be it car, home, travel etc, is based on statistical evidence of risk, therefore if young male drivers are by some distance more likely to be involved in serious accidents or make claims, why the hell should the rest of us, male or female, pay higher premiums to cover that risk?

I'm sorry that pisses you off, as a bloke, but perhaps if many young men stopped driving like utter TWUNTS (and tell me you haven't seen examples of that) then the claims, and thus the premiums, for them would come down.

 

[Simster]

So you are a safe driver, accepted.

With regard to asking an insurer to decide on your ability based on your future experience, how the hell are they supposed to do that. Should there be a question on the proposal form as to whether you think you will be involved in an accident over the next 12 months. Are they to wait until you've had an accident and they say well this should have been the premium for the year then. It's ludicrous.

Or alternatively (and fairly simply), you accept that everybody pays a fairly high rate when they start out, which then falls year on year when they don't make a claim. What is ludicrous is that you seem happy to accept that males should pay twice what females do, simply because of their sex. Are you saying there are NO dangerous female drivers? Are you saying that all males are dangerous drivers?

If your answer is no to either of them, then given your position, you won't fall about in mock indignation at the suggestion that black people should pay a tax on anything that could be used as a weapon because statistically they mug more people than white people do.

 

[Simster]

That's a ridiculous argument as higher crime rates are based on geographical not ethnic factors. And yes, people living in high crime areas pay more but that's because they're more likely to claim not because they're black or Asian or whatever. All insurance, in any category, be it car, home, travel etc, is based on statistical evidence of risk, therefore if young male drivers are by some distance more likely to be involved in serious accidents or make claims, why the hell should the rest of us, male or female, pay higher premiums to cover that risk?

I'm sorry that pisses you off, as a bloke, but perhaps if many young men stopped driving like utter TWUNTS (and tell me you haven't seen examples of that) then the claims, and thus the premiums, for them would come down.

I don't disagree with ANY of what you say, BUT:
a) it boils down to what I said earlier. In the case of ethnic discrimination, you rightly want insurance companies to look at the bigger picture and view their geographical circumstances, yet you won't consider the same for sexual discrimination.
b) But I'm not and never was a young man who drove like an utter TWUNT, so why should that affect me. I didn't insure those morons, so don't expect to pay for the fact that insurance companies can't distinguish between me and them.

Oh and Edna, I'd be curious to know your position on sexual discrimination in the work place. Is it fair that women earn 15% less than their male counterparts because there is a chance they might have a baby and therefore cost a lot more in paid leave, or wasted training expense?

 

[Badger]

Is it not the case that UNINSURED drivers add a fairly hefty chunk to our premiums? I'm not sure what the figure is but I'm sure it is far too high. If an uninsured driver crashes into you then you're the one that suffers because your insurance company has to pay out. I would say that is equally as annoying for me as young male drivers getting charged higher premiums. It is far too easy to drive a car without insurance and if you get caught you're likely to get your car taken away and I would guess 99% of the time that car will be worth less than your annual insurance.

 

[bluestt]

The thing that annoys me is the fact they put so much reliance on stats - as they say, stats lie and never tell the whole story about a particular group, whether it be a minority group or not

 

[Simster]

By far the best response on the subject, IMO:

This is the nub of the recommendation that was given to the ECJ as a precursor to this ruling; that discriminatory pricing should not just be based on statistics but have some reason behind it. For example if you undertook a study which said that Asians are involved in 10% less accidents than White British people you shouldn't simply set the premiums 10% lower without some understanding of why this is the case (and proof that it is not simply a statistical anomaly). The problem is that, in the case of male vs female, there is plenty of evidence as to why men have more accidents.

You might be correct, but it doesn't make it right. There is plenty of evidence to suggest that a black man is more likely to be a mugger than a white person, but it doesn't make it right to assume that he will become one.

The supposition is two-fold. First of all, insurers will not be sure exactly how to price the combined premium, and will err on the side of caution (which for them means higher prices). This is because they are unsure of people's willingness to pay the new premium rate, and they are unsure of the effects of the price movement (for example, if a male teenager's insurance is suddenly c£200 cheaper, will he spend that £200 on a new/souped up car, thereby increasing his risk still further?). In the long run, insurers seek to profit maximise, and this means draining as much as possible from the driver. Teenagers of both sexes tend to be very keen to get insurance and go out and drive (due to a combination of the newness of being able to do so and in many cases mummy and daddy picking up the tab), and are therefore probably more likely to pay over the odds to do so.

The insurance market isn't really that competitive (smaller specialist insurers aside). There's plenty of scope for profit maximising from individuals.

I would agree that in the first instance, prices would be much higher, but market forces would see them settle down over a couple of years. Certainly not a reason to remove draconian sexism, IMO.

 

[seagullsovergrimsby]

The insurance companies are rubbing their hands with joy because they know in 2013 they can increase premiums for female drivers by 25% and at the same time reduce premiums for male drivers by virtually nothing.

 

[beorhthelm]

Oh and Edna, I'd be curious to know your position on sexual discrimination in the work place. Is it fair that women earn 15% less than their male counterparts because there is a chance they might have a baby and therefore cost a lot more in paid leave, or wasted training expense?

the 15% dissparity is a statistical construction because most women do have a baby and leave employment for a period, and often do different jobs, so like for like comparisons across vocations, companies and industries shows a gap. but look at the atomic job by job level and the gap vanishes. a job is advertised at £25k and the recruited employee gets that regardless of gender.

 

[Simster]

The insurance companies are rubbing their hands with joy because they know in 2013 they can increase premiums for female drivers by 25% and at the same time reduce premiums for male drivers by virtually nothing.

Again, where is your evidence? Mind you, it's worth pointing out that this whole debate is only happening because dickheads like your son drive at 95 mph on the motorway, so if his premiums don't come down then it's perfecly justified.

the 15% dissparity is a statistical construction because most women do have a baby and leave employment for a period, and often do different jobs, so like for like comparisons across vocations, companies and industries shows a gap. but look at the atomic job by job level and the gap vanishes. a job is advertised at £25k and the recruited employee gets that regardless of gender.

I'm not sure I believe that, to be honest. There is plenty of evidence to suggest that two people doing the same job in their late 40s (or well after child bearing age) will be paid differently based on their gender. As I say, I'd love to know what edna thinks of that.

 

[beorhthelm]

...There is plenty of evidence to suggest...

"suggest" is a loaded, subjective word. i would want to compare say two teachers, security guards, solicitors or police, side by side with same qualification and experience and see what the difference is. the differences emerge when you introduce different years experience, different career paths and compare different companies and industries where a job title isn't describing the same thing.

 

[Lady Whistledown]

Simster: so long as you're happy (as a man) with the notion that you'll now lose out when it comes to your pension as a result of this case, then we're all winners in this aren't we?

 

[Simster]

Simster: so long as you're happy (as a man) with the notion that you'll now lose out when it comes to your pension as a result of this case, then we're all winners in this aren't we?

Really? How?

 

[beorhthelm]

Really? How?

because men statistically live shorter into retirement than women, so get a higher annuity from the same pension fund. car, medical insurance and pensions have all been impacted by this. i think men might typically pay a little less on medical insurance too, presumably thats going to go up now too.

 

[Simster]

because men statistically live shorter into retirement than women, so get a higher annuity from the same pension fund. car, medical insurance and pensions have all been impacted by this. i think men might typically pay a little less on medical insurance too, presumably thats going to go up now too.

Again, I'd have no problem with this providing the insurance companies actually look further into the underlying factors surrounding life expectancy in retirement age on a case by case basis. There is no reason why a woman (or healthy man) should pay for a fat berk who has not done any exercise over the years and has abused his body for years by eating fry-ups daily and drinking ridiculous quantities of alchohol 4 times a week, or whatever.