The arrival of technology was set to create a fairer playing field for drivers whatever the age.

However research from data and analytics company GlobalData, has found  while younger drivers are increasingly being offered schemes such as telematics smartphone apps and black boxes it does not translate into cheaper rates.

Younger drivers are one of the primary target audiences for new, non-standard policy types such as telematics propositions. More than 35% of 17-25 year olds had a telematic policy in 2018, according to GlobalData’s 2018 UK Consumer Insurance Survey.

Liam Hopson, Insurance Analyst at GlobalData, comments: “These policies are designed to help young drivers prove they are driving safely to reduce their annual payments. However, this age category consistently pays the most expensive premiums. It is the worst for motorists under 21 years old, with their average premium being more than double the overall average premium.”

High costs associated with owning a vehicle, including high insurance premiums, is one of many contributing factors to the rising number of people who are abandoning learning to drive and waiting until they are older and more financially stable. This ultimately affects their independence, social mobility, and employment prospects as they have to rely on friends and family to drive them around or use public transport.

Ben Carey-Evans, Insurance Analyst at GlobalData, concludes: “Insurers face the rising problem of pricing young drivers out of the market but being unable to lower premiums due to the increased risk they carry. A solution to this beyond the traditional telematics policies could be pay-per-mile policies. Start-ups, such as By Miles and Metromile have been successful in the UK and US, respectively, as they charge a small, annual flat fee and then charge by the mile – meaning consumers can limit their driving and costs if and when they need to.”

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