Insurance costs: loading the young
Census figures suggest the number of young drivers should be rising
A significant drop in the number of young people holding a driver’s licence or applying for a learner permit is undoubtedly linked to the prohibitive cost of car insurance for young drivers.
The figures tell their own story. Data from the Department of Transport shows that the number of 17- to 20-year-olds holding a learner’s permit declined by a third from 90,413 in 2006 to 57,821 in 2016. The number of young people in the same age group holding a full licence declined from a peak of 52,000 in 2008 to 35,173 in 2016.
Although the figures don’t reveal why the number of young drivers has declined so significantly, on the face of it the cost of car insurance is the most important factor. Given the increase in population revealed by the census figures, the number of young drivers should be rising.
The cost of insurance is one of the prime reasons for the large number of uninsured drivers which in turn leads to higher charges for those who comply with the law.
The Government has recently published a plan designed to improve the provision of car insurance but early action on its recommendations will be required as a first step in tackling the problem. On foot of the report, the Government has established a personal injuries commission. Among other things, it will examine the cost of compensation awards for soft tissue injuries and compare them to the average awards in other countries. The insurance industry has claimed, with some justification, that excessive payouts for certain injuries such as whiplash have contributed to high insurance costs.
Among the other recommendations are the establishment of a national claims information database which will enable the Garda to check insurance compliance with the use of technology such as automatic number plate recognition.
There is no simple answer to the problem but more rigorous enforcement by gardaí, a more realistic approach by the courts to compensation and more transparency from the insurance industry will be required.