Young driver news - Young driver insurance prices are beginning to drop

Car insurance news - Young drivers may pay less for insurance

A report has revealed that the price of young driver insurance has finally begun to fall. The cost has increased greatly over the past decade and this has reportedly prevented many young drivers from taking to the roads.

It is thought that high car insurance prices have caused a reduction in the number of young people taking driving tests, with 60,000 fewer 17-year-olds taking tests in 2010 than in 2008.

The news comes amid major re-pricing of car insurance due to a European Court ruling which will outlaw sex-based pricing, made earlier this year. Insurance costs determined by the driver's gender must be abolished by December 2012.

Without the new laws in place, young male drivers are often forced to pay twice as much as young female drivers. In some cases, car insurance costs thousands of pounds. However, annual premiums have already begun to decrease for young men, as well as a slight price drop for young women.

The report predicts that the AA's next British Insurance Premium Index, which is due out in October, will show annual premiums indicative of further price falls expected in early 2012.

Suppliers of telematics insurance, such as insurethebox, will not be affected by the gender directive as cover is calculated on the individual driver, so they are already able to offer competitive quotes.

If the price of young driver insurance continues to fall, prospective young motorists may feel more encouraged to pass their driving test and take out a first time car insurance policy.