This is the first time since the Confused.com/Towers Watson Car Insurance Price Index began in 2006 that average annual car insurance costs for young men have exceeded £4,000.
Bizarrely, young male drivers in this age bracket see their car insurance costs reduce by around £1,000 if the driver is married and adds their partner to the policy.
In order to afford a £4,000 a year premium and cover the cost of running a car, the average single male would need to spend £6,500 a year – almost half of the average salary of full-time employees at this age. This effectively prices them out of the market.
Gareth Kloet, Head of Car Insurance for Confused.com commented: “For young male drivers it has never been more important to shop around for the best price. Our consumer research shows that 50% of under 25s could save up to £556 on car insurance* by using Confused.com. This is one way to help combat these rises.”
The news isn’t only bad for young drivers though. The average cost of a comprehensive car insurance policy across the UK stands at £858 (as of the end of June 2011), marking a year on year rise of £170.
Despite the huge increase in the last twelve months, prices are still continuing to rise. In Q2 of 2011, prices inflated by an average of 25% compared to Q2 2010.
Statistics from Quarter 2 of 2011 tell us that:
* The average cost of comprehensive cover in the UK is now £858, up £22 in the last 3 months and up £170 in the last 12 months.
* The annual rate of price inflation for comprehensive cover is now 25%.
* The average price of a comprehensive policy increased 2.7% across the UK in Q2, with drivers in Northern Ireland hit hardest with a 5.1% increase.
* The average price of a comprehensive car insurance policy rose by 2.7% in the second quarter of 2011, the fourth consecutive quarter in which price rises have been less than in the previous quarter.
* Third party, fire and theft (TPFT) cover increased the least in Q2 by just 1%, but the cost a TPFT policy is still up 33% in the last year.
* The biggest increases this quarter have been seen among the 29-33 year old age group.
Over 4 million quotes are used in the construction of each quarter’s insurance price index – this makes it the most comprehensive insurance index in the UK.
^Office for National Statistics, Annual Survey of Hours and Earnings 2010; average wage of full-time employed 16-21 year olds is £14,833
*Based on online independent research, Consumer Intelligence (June ’11). 50% of consumers, aged 17 – 25, could achieve this saving.