Car insurance Car insurance for older drivers
Turned down or charged more for car insurance
Older drivers have long felt penalised by car insurers - having to pay higher premiums or being refused cover altogether. Our research has shown that many insurers currently don't cover those aged 81 and above.
Insurers maintain that they're entitled to charge higher premiums for older drivers because the likelihood of claiming on car insurance and the cost of those claims are greater for this group. However, charities like Age UK feel that these restrictions leave many people struggling to pay increased premiums just when they may need cover most.
A car insurance premium for getting older
Our analysis of car insurance policies shows that average premiums increase sharply as you move through the age groups. For example, we found that an annual policy for a 75-year-old woman living in north London and driving a Citroen would cost £702 with Saga. However, at 85 it would cost £1,224 - a 74% increase.
It’s vital at the best of times to shop around for the best rates, but even more so as you approach those age milestones. For example, there are considerable differences between online and telephone quotes even with the same companies - we found that a 65-year-old man in the same scenario would pay £465 annually with Direct Line over the phone, but the same deal online would cost £362.
The Equality Act – what does it mean for older drivers?
The Equality Act (2010) paved the way for more up-to-date discrimination legislation. Companies can still rate risks according to age when it comes to car insurance, as they received an exception to the Act, but they must produce statistical evidence that justifies their pricing policies.
The agreement between the stakeholders in April 2012 stressed that insurers now have to help consumers who are turned down at point of sale, directing them to an independent source of information able to offer assistance in finding affordable cover - this is known as 'sign-posting'. Currently, customers unable to find quality and affordable cover are left to continue their search alone without the knowledge of where to find alternative insurance.
The car insurance industry view
Car insurance organisations are obviously keen to retain some flexibility in choosing customers and setting premium levels. The British Insurance Brokers’ Association (BIBA) wants the Bill to help older people access cover more easily: ‘BIBA’s own vision of legislation is one that ensures fairness and sign-posting to help people, but does not force insurers to cover areas they have never dealt with and do not understand.'
Malcolm Tarling from the Association of British Insurers told Which?: ‘We believe that the government understands that insurers should continue to be able to use age as one of the risk factors, providing this approach is based on authoritative statistical data.’
Getting the right car insurance deal
If you're having difficulty finding cover at a reasonable rate, you can phone the free Which? Money Helpline (if you're a Which? member) on 01992 822 848. Our financial experts will be happy to point you in the right direction. Older drivers can also contact BIBA on 0870 950 1790.