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Age and motor insurance

Why motor insurers use age when pricing cover. 

There are a large number of different rating factors used in setting the price for motor insurance. These include factors associated with the vehicle, where it is kept and the people who drive it. For the latter, age can materially influence both the likelihood of policyholders making a claim and the cost of such claims when they occur.

Impact of age on motor insurance claims and premiums

Chart One shows the percentage of customers claiming per policy, the average cost of a claim and the average premium for different age groups for private motor insurance in 2020 for people aged 18-20, 21-25 and so on in five year bands until age 90. All policies for people aged 91 and over have been grouped together.

Chart One - Average claim, average premium and claims frequency motor insurance by age, 2020

For all age bands, there is a clear relationship between premiums paid and the cost and frequency of claims. This pushes premiums up for younger and older drivers. For drivers between the ages of 31 and 75, who experience claims frequencies as low as 4.7%, and claims as low as £2,948, premiums fall significantly. 

Of this group, drivers aged between 66 and 70 are the best off, paying just £279 for their car insurance, which is just under a third of the average price paid by 18-20 year olds. Though these drivers don’t have the lowest claims, with drivers aged between 51 and 65 having lower average claims, drivers in the 66-70 age range have the lowest claims frequency.

If you are finding it difficult to find suitable cover, a specialist insurance broker will usually be able to help. The British Insurance Brokers’ Association (BIBA) can put you in touch with a specialist broker.