Insurers join the fast lane

'High risk' motorists are no longer seen as pariahs, says Tom Tickell

Car dealers up and down the country are revving up for sales, as cars with the new R registration roar into view on Friday.

The risk of making an insurance claim in the first year you own a car is slightly higher than average, but only because people tend to drive slightly further in year one than in year two.

All insurers are keen to offer cover to safe, middle-aged drivers with a good no-claims record. But millions of drivers do not fit into that profile, and in the past many insurers, particularly those selling "direct", have treated these higher risks as pariahs. By making prices deliberately unattractive, they ensured such drivers looked elsewhere.

Young drivers, particularly those with sports cars, come into the "sub- standard" risk category. So too do motorists with a drink-driving conviction. But one group of people who traditionally had problems should now get a better deal. Under the new Disability Discrimination Act, insurers cannot charge disabled drivers more than the standard rate for any matching able- bodied motorist, unless they have statistical evidence showing they are a worse risk.

Life is in fact easier for anyone who does not fit the perfect insurance profile. Five years ago, direct insurers only went for good risks - "cherry picking" - so other rates rose disproportionately. Rates for good drivers came down dramatically - and so did profits. Now companies are more flexible. Direct Line may not insure you if you have had problems, but Privilege, its subsidiary, will do so. Traditional insurers like Bishopsgate and Norwich Union are also more liberal than they used to be.

Insurers do not all go for the same market. Hastings Direct, for example, is one of the few direct insurers to take on 19-year-olds driving sporty Golf GTIs, but it will not insure people with a drink-driving conviction.

Normally, a first drink-driving offence will mean a fine and a 12- to 18-month disqualification. When the ban is over, your previous insurer will normally take you on again, but the terms may be punitive (see table). As well as higher premiums, many drivers face having to pay more of any subsequent claim (the excess). Legal & General, for example, bumps up its excess from pounds 100 to pounds 250. One or two companies will restrict you to third- party fire and theft cover, and premiums - as the table shows - can vary enormously.

Specialists will often offer better terms. Emma Kirkaldy of Privilege Insurance claims drivers returning to the wheel after a ban do not revert to previous bad habits: "Almost all of them, " she claims. "They are acutely aware of the risk that they could lose their licences again, and our figures show that, as a group, they make fewer claims than other people.

"We have to allow for the longer-term risk that they may revert back, so rates will always be higher than for the run-of- the-mill driver. But rates overall are almost always lower than elsewhere."

Insurance people may know who is more, or less, sympathetic but ordinary motorists do not. Going to an insurance broker to find the group offering the best rates overall is good advice as far as it goes - but there is a snag.

Certainly brokers can help. Companies like Premium Search are already screen-based, so they can easily find comparative rates for any given risk. And Premium Search can probably find one of the best deals available.

The problem is that brokers only recommend companies which give them commission. That excludes all direct insurers, including specialists like Privilege and Hastings. Sitting down to ring round a mass of direct insurers, and getting a quote from each of them, may seem extraordinarily tedious even if quotes can be given directly over the phone. But it remains the best option for anyone with a potentially large insurance bill.

q Contacts: Premium Search, 0800 109876; Privilege Insurance, 0990 998800; Hastings Direct, 01424 735735; Admiral Insurance, 01222 480000.

THE COST OF A DRINK*

Annual premium

Insurer 1 year no-claims 4 years no-claims Excess

Brokers 'best buy' pounds 497 pounds 303 pounds 200

(found through

Premium Search)

Privilege pounds 583 pounds 324 pounds 300

Legal & General pounds 1,850 pounds 925 pounds 250

Bishopsgate pounds 737 pounds 440 pounds 225

Norwich Union pounds 738 pounds 540 pounds 100

*Costs of fully comprehensive insurance for a 26-year-old male driving a Ford Escort 1.6LX based in Colchester, driving again after a one-year drink-drive ban.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
Lionel Richie has made the top spot after a strong Glastonbury performance
musicAnd what's more it's the last Sunday night chart topper - ever!
News
news
Life and Style
The collection displayed Versace’s softer side, with models wearing flowers and chiffon dresses in unusual colourings
fashionVersace haute couture review
Arts and Entertainment
DJ Chris Moyles who claimed to be a second-hand car dealer in a bid to save up to £1 million in tax, a tribunal has found
radio
Arts and Entertainment
'The Leaf'
artYes, it's a leaf, but a potentially very expensive one
Finacial products from our partners
Property search

Money Insider: How to make credit cards pay

Andrew Hagger reveals how to get the most from your plastic

Questions of Cash: My 'perfect travel companion' from the Post Office was a waste of money

One reader purchased the Post Office Travel Money Plus Card for a motoring holiday but discovered it can't be used at self-service petrol stations or autoroute toll booths

Continuing low interest rates are encouraging more people to switch to interest-only mortgages

Interest-only mortgages return to give more flexibility to borrowers

The credit crunch put a temporary end to these once-popular mortgages. But lenders are waking up to rising demand and relaxing their rules

EU to scrap roaming charges in 2017: European Commission under fire for taking so long to act

UK consumer groups complained that British holidaymakers face another two years of mobile phone misery before the law comes into effect

On the money: Yorkshire building society has demonstrated that it is taking the P2P industry seriously

Is peer-to-peer lending a risk worth taking?

The P2P industry must do more to shake off an unjustified image of being too complex and risky for the everyday saver, says Andrew Hagger

Generating grievances: Scottish Power's Longannet station in Fife

Questions of Cash: Scottish Power says it's sorry - again and again

Six of the energy company's customer have cause to blow a fuse this week

Will Patisserie Valerie be the portfolio's sweet spot?

Derek Pain: 'Patience is a virtue but maybe I should cut and run'

Derek's portfolio is currently suffering because of his failure to be more ruthless

There are now more than three million people in “severe problem debt”

Debt managers are misleading vulnerable people, warns watchdog

One debtor was given a repayment plan that would have taken 125 years to repay

Challengers are smashing the traditional high street banks when it comes to offering decent savings rates

Ignore the new breed of savings institutions and you'll lose interest

NatWest has ripped up its pledge to never be the last bank in town

NatWest pledged five years ago it wouldn't close the last bank in town. Now villagers have been told the branch shuts in September

When the last bank closes, local shops quickly go out of business

Under new state pension rules we will all be much worse off

Why did no one notice? The Government hides behind complexity, says Neasa MacErlean

Bogus Islington landlord scams public for £20,000 in fake deposits

It’s not just Islington... Simon Read warns renters and landlords about a nationwide fraud operation

Questions of Cash: The paperwork wasn't right so I was left high and dry with a broken washing machine

A reader encountered a problem with a Currys washer/dryer care plan

Borrowers should steer clear of established providers to get the best rates

Interest rates have never been cheaper if you want a five-figure personal loan but for lower-value loans it's a very different picture

Personal banking: Banking chiefs at NatWest and RBS insist that they are over the worst of the technical issues but customers are still complaining of payment issues. NatWest has waived overdraft fees and told customers they can withdraw £100 more than their limit over the next few days

People’s bank in crisis again: What should you do about the NatWest/RBS meltdown?

Thousands still waiting for payments to go through

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Recruitment Genius: Sales Assistant / Buyer

    £15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

    Recruitment Genius: Customer Service Advisor

    £15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

    Recruitment Genius: Compliance Manager

    £40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

    Day In a Page

    Greece says 'No': A night of huge celebrations in Athens as voters decisively back Tsipras and his anti-austerity stance in historic referendum

    Greece referendum

    Greeks say 'No' to austerity and plunge Europe into crisis
    Ten years after the 7/7 terror attacks, is Britain an altered state?

    7/7 bombings anniversary

    Ten years after the terror attacks, is Britain an altered state?
    Beautiful evening dresses are some of the loveliest Donatella has created

    Versace haute couture review

    Beautiful evening dresses are some of the loveliest Donatella has ever created
    No hope and no jobs, so Gaza's young risk their lives, climb the fence and run for it

    No hope and no jobs in Gaza

    So the young risk their lives and run for it
    Fashion apps: Retailers roll together shopping and social networking for mobile customers

    Fashion apps

    Retailers roll together shopping and social networking for mobile customers
    The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

    Gaping hole at the heart of the European Union

    Treatment of Greece has shown up a lack of genuine legitimacy
    Number of young homeless in Britain 'more than three times the official figures'

    'Everything changed when I went to the hostel'

    Number of young homeless people in Britain is 'more than three times the official figures'
    Compton Cricket Club

    Compton Cricket Club

    Portraits of LA cricketers from notorious suburb to be displayed in London
    London now the global money-laundering centre for the drug trade, says crime expert

    Wlecome to London, drug money-laundering centre for the world

    'Mexico is its heart and London is its head'
    The Buddhist temple minutes from Centre Court that helps a winner keep on winning

    The Buddhist temple minutes from Centre Court

    It helps a winner keep on winning
    Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

    Is this the future of flying?

    Battery-powered planes made of plastic, and without flight decks
    Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

    Isis are barbarians

    but the Caliphate is an ancient Muslim ideal
    The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

    Curse of Brink's Mat strikes again

    Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
    Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

    'The ministers talk to us about miracles'

    Why Greeks are cynical ahead of the bailout referendum
    Call of the wild: How science is learning to decode the way animals communicate

    Call of the wild

    How science is learning to decode the way animals communicate