It looks as though This is because of new EU gender rules that followed last year’s ruling by the European Court of Justice. Many parents have to help out with their children’s car insurance these days, but it’s becoming more expensive by the year.
From next month, it will be illegal for insurance companies to take gender into account when calculating a customer’s insurance premiums. European gender equality rules, set to come into force from December 21st, mean that insurance premiums could rise, and a third of the parents surveyed by Aviva believe that this could spell the end of them paying their children’s car insurance.
Findings from the Aviva survey showed that parents were pessimistic about the effect the change in insurance rules would have on their wallets. A high number of parents are already paying for their kid’s car insurance, and six out of ten parents thought that insurance premiums would rise – but only 8% of parents surveyed thought that premiums would fall!
In fact, the survey revealed that around a third of parents who were paying for, or contributing towards their children’s car insurance, were worried that premiums might rise to such an extent that they would be forced to stop paying their children’s car insurance. Aviva maintains that these concerns might be a little premature, as industry experts have suggested that premiums for young male drivers could actually drop by up to 10%. Young women won’t be as fortunate, and they will probably find that their premiums go up by as much as a quarter.
Gender has traditionally been a factor that insurers have taken into account. When assessing risk, women are known to be safer drivers, with lower accident rates. It makes sense that they should have lower premiums to pay, and women have been enjoying the benefits of this for years.
There is also some confusion around the gender rules change, and Aviva’s survey confirmed as much. It would appear that only a fifth of the parents asked were sure about exactly what the changes will mean.
Nobody can actually say for sure how premiums will be affected at the moment, and MoneySupermarket, the price comparison website, advised that car insurers haven’t applied any significant price changes as of yet. However, judging by these early indications, it looks as though there’s an average price increase of about 2% on car insurance premiums so far. MoneySupermarket’s consumer finance expert, Clare Francis, doesn’t think that the gender law change will have too big an impact on premiums. In fact, there are so many other factors to take into account such as profession, postcode and any points a driver may have on their licence. Any one of these could potentially lead to higher premiums.
She is also advising people to hang fire, and has warned against cancelling cover and looking for a new policy. It’s a drastic step that could see you being stung with a nasty cancellation fee.
Meanwhile, Aviva’s survey has shown that about a third of parents are seriously considering whether their children’s cars should be swapped for cheaper ones. Around a half of parents are prepared to put more towards their children’s premiums, or they are thinking about it, at least. Many parents feel it’s important that their children stay on the roads.
Aviva said that telematics technology can help young drivers to reduce their insurance premiums. For the uninitiated, telematics rewards careful drivers by slashing their premiums. Parking off road or in a garage, and switching to a less powerful car will also help young motorists to stay mobile by keeping their premiums down.
B6TJ67 Learner driver, puts l plates on red car. Image shot 2006. Exact date unknown.