Passing your driving test is usually a time to celebrate. But for Independent reader Mike Ford, his joy was cut short when he passed his test last month because his insurer suddenly withdrew his cover. The reason? Marks & Spencer said it didn't want to insure the 17-year-old any more because, as a qualified young driver, he was too much of a risk.
M&S isn't alone in penalising young people for being successful learners. Our tables below show that most insurance providers ramp up the cost of cover, but few go as far as M&S in simply leaving their customers uninsured.
The move angered Mike's father, Rob. "I find it totally reprehensible that a company of M&S's standing should take on a provisional driver in full knowledge that they would cancel the policy the minute he passed his test, with no prior warning," Mr Ford said.
"What sort of signal does this send out to young drivers and their parents? Insurers warn of the dire consequences of a driver being found to be fronting [when someone other than the main driver is declared as the policyholder]; yet they treat honest policyholders with contempt."
It is hard not to agree with him but M&S washes its hands of any responsibility. A spokeswoman said: "M&S Money does not underwrite car insurance. We use a panel of insurance companies that can offer a range of cover and premiums. Our panel took his application through underwriting but – as is often the case with young drivers – this was declined."
But the firm was happy to take Mike's cash in the first place while knowing that, if he was a good enough driver, he would pass his test. It is this apparent shabbiness and lack of customer care that really annoys Mr Ford, especially when his son chose to go with M&S because he thought it was a name he could trust.
"If an insurer is prepared to offer a policy to a provisional driver, at extortionate cost, they should be prepared to maintain the policy for its full term and disclose, if necessary, the fact that there may be additional premiums to be paid if the insured passes the driving test during its duration," said Mr Ford.
Other insurers claimed they would not leave customers in the lurch as M&S did. Graham Johnston, a motor strategy underwriting manager at Direct Line, said: "We determine the price of a car insurance policy on the information given by the customer at the time of the initial quote. If a Direct Line customer has a provisional licence and subsequently passes their driving test, we would not cancel their policy or increase their premium when they notified us."
M&S's decision forced Mike to shop around all over again for new cover. He eventually got a deal with Endlseigh, which specialises in covering students and young people, but the cost of cover soared, rising from the £2,750 charged by M&S for annual cover forMike's Fiat Punto to £3,500.
There are sensible explanations to explain why insurers charge young drivers more once they pass their tests. For a start, provisional drivers must have an experienced driver in the car with them, which presumably helps to reduce the chances of an accident. And then insurers have years of experience of claims, which teaches them that newly qualified drivers are more likely than most to have an accident.
"Insurers rate on a variety of factors, and unfortunately 17-year-olds have no proven experience outside lessons and supervised driving," explains Will Thomas, the head of motor insurance at Confused.com. "Driving on a provisional licence is considerably less risky with an instructor guaranteed to be in the car at all times, but as soon as young drivers get on the road alone, the risk of an accident increases massively."
As our table shows, the average cost of cover for a 17-year-old boy like Mike jumps by about £2,000 as soon as he is fully licensed, climbing from about £3,500 to £5,500. Charges like this encourage many parents to "front" policies in an effort to reduce costs. If a parent is listed as the main driver, with the child as a named driver, the policy is likely to cost hundreds of pounds rather than thousands.
But fronting is illegal and it is one of the reasons why insurance premiums are rising so quickly, according to the industry. Faced with having to fork out thousands of pounds, it is clear why so many young drivers and their parents break the law, but there are other things you can do to help cut insurance costs, says Mr Thomas.
"To get cheaper premiums a young driver needs to build up experience and a no-claims bonus," he advises. "It will be expensive at first, but unfortunately this is a necessary evil. After the initial outlay, though, a young driver will see their premiums dramatically reduce year on year. The quicker a driver can get this experience, the less they will pay in the long run.
"It is important that drivers ensure they are getting the benefit of claims-free driving by having a car insurance policy in their own name, or that the policy they are on allows them to earn no-claims bonus as a named driver."
Another option is to continue learning and take Pass Plus, the new driving examination course introduced by the Government to give additional driving experience to qualified learners. Confused says 6 per cent of 17- to 25-year-old men do and save more than £1,000 before they reach 25.