How to get cheaper van insurance if you’re under 25
Average van insurance prices fell by 18% for drivers aged under 25 in 2021. Why the sudden price drop? The RAC reports that 4 in 10 vans now have telematics installed, and this halves the number of accidents and insurance claims.
Young van drivers below the age of 25 typically pay eye-watering prices for insurance. As the youngest age category with, statistically, the highest rate of accidents and claims, it’s not unusual for premiums to top £3,000.
This means the good news of 2021 will be very welcome to a lot of young van drivers.
Pricing insights company Consumer Intelligence reports that van insurance premiums for UK drivers under 25 have fallen by 18.1% in 2021. Whilst this leaves the average van policy costing £2,342, this still represents a saving of more than £420 a year for most van users.
Why have van insurance prices fallen?
Telematics is a big driver for the premium deflation seen by younger drivers.
Installing a vehicle tracking device, especially one with driver metrics, can bring about impressive reductions in insurance prices for individual young drivers. Many telematics brands now provide detailed data on actual driving habits to insurance companies. They use this to make more personalised pricing models so, instead of relying on average accident and claim rates, they can reduce prices for the careful drivers who are less likely to have accidents.
Dash cams are a telematics add-on which are also driving the reduction in the price of the average premium for younger van drivers.
Black box van insurance
This concept in its most basic form is called “block box insurance”. The main information insurers look for is speeding, and whether the driver always stays below the limit; driving times, as accidents more often happen at night; and the roads used, as accidents are more common on country roads and in towns than on motorways. They can obtain all this from a simple GPS location tracker which can cost just a few pounds each month.
Driver metrics for telematics insurance
A more sophisticated version of telematics includes driver metrics. This technology is connected to the vehicle CAN bus and other key components, recording and transmitting data on over-revving the engine, speeding, braking and sudden cornering. This data gives important information on whether the driver is tailgating, taking corners recklessly and engaging in other driving habits that are known to increase the likelihood of collisions.
This is a newer area of emerging technology in the insurance industry. Insurers in the UK are just beginning to explore how they can use it to refine their risk measuring and adjust pricing models accordingly.
Dash cams and dual cams
The third method of reducing van insurance costs is installing a dash cam or dual cam, which has a second camera recording the driver. Apart from showing who was liable in a collision, it can also demonstrate if the driver was paying due attention prior at the time and not distracted by using a phone, smoking or generally losing concentration through tiredness.
These cameras can help to settle insurance claims quickly and nip disputes in the bud, which normally results in a lower overall claims cost for the insurer and therefore less of a premium price hike the year after the claim for the insured van.
Over the course of years, using a dash cam or dual cam can reduce premiums quite dramatically.
Telematics cuts collisions and insurance claims by 52%
The RAC Business Research unit reports that nearly 40% of UK businesses now use telematics, with London-based drivers above the national average at 45%. This represents a steady increase in usage and corresponding reduction in collisions and claims.
Of all the businesses that the RAC surveyed, 52% said they had seen a reduction in accidents involving their staff since installing telematics in their vans and other vehicles. What’s more, 11% said their insurance premiums had decreased as a result of installing telematics.
It’s estimated that around a quarter of the UK’s 32.7 million drivers now have a dash cam fitted in their car, with motorists submitting on average 35 dash cam videos to UK police every day and many more to their insurers.