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The financial comparison website’s latest Young Drivers Index also shows that the average cost of a full comprehensive policy for motorists in the 17 to 19 age group stands at £935, which is significantly higher than the £364 average for those aged 20 and above.

To come up with the figures, the firm analysed more than one million quotes requested by its clients between June 2020 and June 2021. The company also used the data to identify the most popular cars among first-time drivers and the typical cost of insuring these vehicles.

The Ford Fiesta tops the list of most popular cars among young motorists based on insurance searches, according to the index obtained by financial advice and information website This Is Money. But with fully comprehensive coverage for 17- to 19-year-olds costing an average of £711, the model is not the cheapest to insure for the age bracket.

None of the top three favourites actually made the list of cars with the lowest premiums. The Vauxhall Corsa and Volkswagen Polo, which placed second and third in the most popular rankings, cost £689 and £656 to insure for first-time drivers.

For these three models, the average insurance rates drop to £347, £393, and £392, respectively, for drivers aged 20 and older. 

Read more: Young drivers across the UK are feeling the crunch of rising auto insurance costs

Why is car insurance more expensive for young drivers?

Every registered vehicle in the UK is included in one of 50 insurance categories, according to MoneySuperMarket. The easier the car is to repair, and the less rare, expensive, or powerful it is, the lower the group it will fall under. Premium costs also tend to be cheaper when the vehicle is in a lower insurance category.

The following factors are the primary determinants for a vehicle’s grouping, according to the financial comparison website:

• Vehicle’s price
• Cost to repair
• Cost of common replacement parts
• Length of time to repair
• Performance, including acceleration and top speed
• Safety and security features

However, insurance groupings are not the only factors that impact premium prices. Insurance cost can also be affected by every driver’s details, including age and driving history.

Read more: Ten most (and least) expensive job titles for car insurance

“Car insurance premiums are often higher for drivers who have recently passed their test as insurers associate more risk with them,” Praksha Patel-Shah, car insurance expert at MoneySupermarket, told This Is Money. “Prices can also differ significantly depending on the type of car you drive.”

To save on premiums, Patel-Shah advised motorists, especially the younger ones, to shop around using price comparison sites to find the best deals. She also shared tips on how first-time drivers can lower car insurance costs.

“There are a number of ways for newly qualified Britons to reduce their insurance premium,” she said. “You can keep costs down by reducing your mileage or opting for a higher excess. You could even look into telematics policies, which use data to monitor how people drive, and use this to determine the cost of their car insurance. The more careful the driver, the more competitively priced the policy.”

“It’s also important that you don’t just accept the first car insurance quote you receive,” Patel-Sheh added. “By shopping around and comparing you could easily save yourself up to £235.”

Read more: Top 10 car insurance companies in the UK

Ten cheapest cars to insure for first-time drivers in the UK

The cheapest cars to insure are not necessarily the most popular for the country’s young drivers. However, these vehicles do not necessarily lag in performance and can enable newly licensed motorists to save hundreds of pounds in premiums. These are the least expensive cars to insure for drivers aged 17 to 19, based on MoneySuperMarket’s data.

1. Citroen C1

• Average full comprehensive cover for 17 to 19: £506
• Average full comprehensive cover for 20+: £294
• Difference between age groups: £212
• Percentage increase between age groups: 72%

Topping the list is the Citroen C1, which runs on a fuel-efficient 1.0-litre petrol engine that is suitable for city driving. The model is also easy to maintain, helping keep insurance costs down. Based on auto review site Parkers’ insurance group checker, most versions of the vehicle fall under category six to 13. Annual premiums for the 17 to 19 age group, however, are still 72% higher than those for over-20 drivers. 

2. Fiat 500 Pop

• Average full comprehensive cover for 17 to 19: £509
• Average full comprehensive cover for 20+: £319
• Difference between age groups: £190
• Percentage increase between age groups: 60%

The Fiat 500 Pop is the entry-level model in the Fiat 500 range and the first version on the list. It is powered by a 1.2-litre petrol engine capable of 59 miles per gallon (mpg), good for driving around the city. Insurance starts as low as group seven but can go up to group 15, depending on the trim.

3. Fiat 500 Lounge

• Average full comprehensive cover for 17 to 19: £519
• Average full comprehensive cover for 20+: £304
• Difference between age groups: £215
• Percentage increase between age groups: 71%

The second of three Fiat 500 models in the list is also the ninth most popular car for young drivers, and for good reason. Apart from Bluetooth connectivity, it is among the most fashionable small cars with its retro styling. Lounge comes with three engine options: 1.2-litre petrol, 900cc petrol, and 1.3-litre Multijet diesel. The last, capable of 76mpg, is the most efficient engine in the line-up. Just like Pop, Fiat 500 Lounge falls under insurance groups seven to 15.

4. Peugeot 107

• Average full comprehensive cover for 17 to 19: £539
• Average full comprehensive cover for 20+: £286
• Difference between age groups: £253
• Percentage increase between age groups: 89%

The Peugeot 107’s strength lies on its low running costs. The car’s 1.0-litre, three-cylinder petrol engine runs at 66mpg and emits just 99 grams per kilometre (g/km) of carbon dioxide (CO2), making it free to tax. Some review sites, however, say the model is not “well-equipped” and may “struggle in out-of-town” drives. Peugeot 107 falls under the three to five insurance categories.

5. Ford Ka

• Average full comprehensive cover for 17 to 19: £543
• Average full comprehensive cover for 20+: £315
• Difference between age groups: £277
• Percentage increase between age groups: 72%

Ford Ka also takes the fourth spot in the most popular rankings, the highest among the models included in this list. Ka insurance costs are among the lowest in the country, thanks to its large dealer network and affordable replacement parts. Most versions are under insurance group three. 

6. Toyota Aygo

• Average full comprehensive cover for 17 to 19: £550
• Average full comprehensive cover for 20+: £305
• Difference between age groups: £245
• Percentage increase between age groups: 80%

Competitively priced, the Toyota Aygo is cheap to run with its 1.0-litre VVT petrol engine and emits very low levels of CO2, meaning motorists do not have to pay road tax. Older versions sit at insurance groups two or three, while recent releases fall under the six to nine categories.

7. Fiat 500

• Average full comprehensive cover for 17 to 19: £560
• Average full comprehensive cover for 20+: £299
• Difference between age groups: £261
• Percentage increase between age groups: 87%

Just like the other versions in the list, the Fiat 500’s small engine makes it cheap to run. Recent versions are powered by a 1.0-litre, three-cylinder engine that also features a mild-hybrid technology consisting of a 12-volt starter generator and a small lithium-ion battery. The vehicle is capable of 53.3 to 56.5mpg, with carbon dioxide emissions starting at 105g/km. Insurance rate gap between age groups, however, is among the highest in the list.

8. MINI One

• Average full comprehensive cover for 17 to 19: £587
• Average full comprehensive cover for 20+: £429
• Difference between age groups: £158
• Percentage increase between age groups: 37%

The MINI One retains the style and character of 60s cars, making it the fifth most popular car among young drivers. Versions running on a 102 brake horse power (bhp) 1.2-litre TwinPower petrol engine or 95bhp 1.2-litre TwinPower turbo diesel engine are available, both equipped with engine stop-start to boost fuel-efficiency and cut CO2 emissions. MINI One sits relatively high in the insurance categories, with the lowest rating at group 13.

9. Renault Clio

• Average full comprehensive cover for 17 to 19: £626
• Average full comprehensive cover for 20+: £354
• Difference between age groups: £277
• Percentage increase between age groups: 77%

The Renault Clio is powered by a 1.0-litre petrol engine with 99bhp, with 1.3-litre TCe petrol versions offered in trims with an automatic gearbox. The car’s low running costs make it appealing to many young drivers, placing sixth in the most popular list. Insurance rating starts at group three but can go up to category 12, depending on the trim.

10. Ford Fiesta Zetec (80)

• Average full comprehensive cover for 17 to 19: £648
• Average full comprehensive cover for 20+: £364
• Difference between age groups: £284
• Percentage increase between age groups: 78%

The Ford Fiesta Zetec is designed for younger buyers who want a car with a sporty look and feel, minus the high maintenance costs and expensive premiums. It is powered by a 1.6 TDCI diesel engine with 94bhp or a 1.0-litre EcoBoost turbo petrol version with 123bhp. In 2019, however, Ford replaced the Zetec with the Trend trim, which comes with several feature upgrades. 

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“Everybody is now more comfortable with digital,” he said, “in fact, they’re demanding a digital experience and we have this investment ready to meet that demand. We’ve been working with customers over the past 18 months through a customer focus group who have been co-creating with us. We’ve been asking them, ‘what have you been looking for? What would you like to see – in terms of digital, online and mobile apps.’ They’ve been helping us and advising us along that road”

By asking the right questions, Prestige has put itself in the mindset to explore the standards being set by other industries, Allen said. Times have changed and people are now keener than perhaps ever before to use digital when accessing services – from ordering a pizza, to hailing a taxi, to online banking. Why shouldn’t insurance be like that, he asked?

“Stroll is [well-placed] to lead the market, because we have banked the time and made the investment into research,” he said. “We’ve spent the time with focus groups of our customers, letting them co-create what they want to see. But something that has come out very loud and clear is that we can no longer benchmark against our insurance competitors. The expectations are being set by Amazon and Apple and Google and all those people who are digital natives – and organisations like ours need to live up to those expectations.”

The philosophy behind Stroll is reflected by its name, Allen said, because it’s all about trying to make insurance as easy as a walk in the park. Purchasing or renewing an insurance policy can be an additional stress for people who already have plenty of financial services concerns to think about.

Prestige is looking to make the entire process as stress-free as possible by aiding the evolution of insurance into a digital service, available at the click of a button. Stroll will allow the customer to obtain a quote or make a purchase online and will offer a companion app through which they can fully manage their insurance policy documents in the palm of their hand.

“The time is right for a new solution,” he said. “There’s a particular demographic of customers, a younger demographic, who will queue up for self-service tills rather than have to speak to someone at a manned till. That demographic of people will tell you that the world has changed. There is a strong cohort of people who want to self-serve but more than that, they want to self-serve at a time that suits them in a place that suits them. And that’s what we’re offering with Stroll.”

Read more: Prestige Insurance Holdings completes swoop for Autoline

A real positive of Prestige’s recent market announcement is its reflection on the role that professional talent plays in building a digitally-orientated insurance firm. Staff can often become slightly wary when a spotlight gets shone on digital, he said, as there is a wrong but natural assumption that this will mean fewer people are required by a firm. This is resolutely not the case for Allen and his team.

This investment is not about cost-saving, he said, but rather about giving the customer what they want, when they want it. Customers have said that they want to self-serve digitally but also that they want to have a reassurance that, should they need to, they can talk to someone or a real person – whether that’s through online chat or voice channels. That’s what Stroll will be doing, which is why the 60 jobs this opportunity is creating will be within business areas ranging from technical jobs such as coders, through to product managers, marketing roles, and those critical people who will be talking to customers on a daily basis.

“We’re in growth mode,” he said. “We need the people we have for that and we need additional people also. We have a history of growth, whether that’s through acquisition or organic growth. This is part of our organic growth strategy, and we will continue to push that. But we’re always going to acquire other businesses and grow inorganically too and we continue to have the capacity to do that when the right opportunities come along. This is a time for growth for the Prestige group, it’s a time for innovation and it’s a time for improving everything for our customers.”

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It has been a year like no other for Insurance Business – and we have you to thank.

Having broken a host of traffic records during the year, the IB team has enjoyed its most successful year to date, both in terms of sponsorship and industry support. For the third time in the last four years, Insurance Business UK scooped the Insurance & Risk Publication of the Year Award at the Willis Towers Watson Media Awards, and, on behalf of the team, we’d like to take this opportunity to thank readers and sponsors alike, and look forward to further raising the bar in 2022.

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Willis Towers Watson (WTW) has launched a new risk and analytics (R&A) model for the trade credit market. 

In a statement, WTW said that the model has been designed as a tool for both newcomers to trade credit insurance as well as seasoned users and analyses clients’ trade receivables to predict potential losses over a range of statistical scenarios.

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Global insurance broker Marsh has strengthened its global aviation practice with the appointment of Rick Howell (pictured) as its new aviation operational risk consulting leader, effective January 02, 2022.

In a statement, Marsh confirmed that Howell, who is based in Hong Kong, will report to Garrett Hanrahan, global head of aviation and space at Marsh Specialty. His responsibilities include advising Marsh Specialty’s aviation clients globally on best practices in operational risk management, safety audits, and governance, as well as in non-technical areas such as culture, people safety, and mental health.

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It’s been revealed that London Bridge Risk PCC (LBR PCC) – the protected cell company whose formation application was sponsored by Lloyd’s as part of the Future at Lloyd’s strategy – is the vehicle through which Nephila Capital funded newly launched Syndicate 2358.

“I am again delighted to see LBR PCC being used to support further ILS (insurance-linked securities) investments at Lloyd’s and to welcome such a prevalent ILS investor as Nephila to the platform,” commented Lloyd’s chief financial officer Burkhard Keese when the insurance marketplace made the announcement.

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Hiscox has appointed Paul Cooper as group chief financial officer, subject to regulatory approval.

The Bermuda-headquartered specialist insurer said that Cooper’s start date will be determined in due course. In October, Hiscox announced that Liz Breeze will take over as interim CFO on Jan. 1, when current CFO Aki Hussain will become CEO to succeed the retiring Bronek Masojada.

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“Our rapid growth is a reflection of our strategic drive to scale the business so that we can provide a really strong regional presence for commercial customers across the UK and across a range of industries,” said Attis director Keith Browne (pictured centre alongside fellow directors Neil Beck and Justin Chadwick).

“We are differentiating ourselves quite clearly from other brokers in the market, as a modern and dynamic business helping directors protect their balance sheets from risk with bespoke insurance cover planned properly by people who actually understand clients’ businesses and the sectors they work in.”

The trio are former employees of Henderson Insurance Broking Group, the independent brokerage sold by Henderson to Aon four years ago for £90 million.

The Attis operations currently span Leeds, Manchester, Halifax, Teesside, Lincolnshire, and Leicestershire. In 2022, the company is looking to set up an office in London, while also eyeing further growth through the organic acquisition route.

“As we continue to recruit, creating quality jobs, in Leeds and across the north and Midlands, we are very much aware that we are aiming to be an employer of choice, creating the best brokerage by attracting and retaining the best people,” added Beck (pictured left).

“We’re really proud of what our team have achieved in our first six months and by investing in people and their careers we hope to make the next six months and beyond even more successful.”

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Willis Towers Watson created the world’s first sovereign debt “catastrophe wrapper” for the transaction. The “catastrophe wrapper” provides insurance protection to cover Belize’s loan repayments after hurricane events. The wrapper strengthens sustainability and resilience to climate shocks, which have previously triggered downgrades in credit rating that have exacerbated economic hardship, WTW said.

“Volcanoes, earthquakes, and hurricanes repeatedly disrupt economic development in the Caribbean region, from households and communities to the sovereign level,” said Dr. Simon Young (pictured above), a senior director at Willis Towers Watson’s Climate and Resilience Hub, who led the design of the catastrophe wrapper. “That disruption leads to higher debt and a longer, more painful path to recovery. The parametric wrapper is a game-changer for the financial resilience of island and coastal nations, and will help to unlock the financing of nature-based solutions in achieving global net-zero and biodiversity targets.”

The transaction was marketed and placed by Willis Towers Watson’s alternative risk transfer team. Munich Re provided the best terms and conditions and was awarded 100% of the placement, which covers the first 31 months of the bond term.

As part of Belize’s debt restructuring program, the country purchased its only international bond with US$364 million of capital arranged by TNC and insured by the International Development Finance Corporation. The commitment enabled Belize to restructure about US$553 million of external commercial debt – an amount that represents 30% of Belize’s GDP – and reduce the national debt by 12%.

The Willis Towers Watson placement can be used as a template for integrated creditors and issuers as global development finance institutions consider integrating climate risks into their mainstream sovereign loan programs, WTW said. The parametric wrapper uses objective criteria to trigger the benefits and pays upfront for relief of debt servicing payments in the event of a disaster.

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“Endsleigh is a brand that needs to grow back into its shoes,” she said. “It’s got some great potential, and it’s very well-known – but to people of a certain age. What interested me is the question of how we can make ourselves relevant to students again while still protecting our commercial and B2B markets in education, where we’re very deep, and also in the charity and not for profit space. We’re a tale of two halves but what we’re increasingly seeing is that customers want the same thing.”

There’s no doubt that students want a more high-tech proposition from insurance services but now even more traditional lines are looking for a high-touch, high-tech approach from their brokers. For instance, she said, Endsleigh recently launched a parent portal to help streamline and digitise the administration of policies in a way that benefits schools and parents alike – and the positive reaction to this has shown that the high-touch element of the traditional broking model must now also embrace market expectations around tech.

Being able to adapt to the future is linked to the foundation of the business, which was founded in 1965 by the National Union of Students (NUS), a student lobbying body and charity, in response to the insurance protection gap. The independent and entrepreneurial spirit that went into creating the business has remained intact throughout its journey, which has seen Endsleigh move through a management buyout, ownership by Zurich Insurance and its acquisition by A-Plan in 2018.

The firm has had a varied history, Meckiffe noted, but its core ethos has remained the same, and NUS has remained stakeholders in the business’s success. The advantage of this is that it means Endsleigh has always stayed close to the market. Now, the next stage in the firm’s journey is to refocus on its core competencies – the student piece, the education piece and the charity piece.

Endsleigh is taking a ‘cradle to graduation’ approach to the education market, she said, servicing nurseries, service schools, independent schools, further education institutions and universities. Its work in the charitable sector is a natural extension of that, as the firm identified the link between individuals prevalent in student unions moving on to work in the charity and not for profit space. The firm has found a real foothold in that market, she said, and has gained a strong reputation which it is utilising to go further and deeper into that market.

The name of the game for Endsleigh now, she said, is “focusing on competencies within a 21st-century context.”

“Endsleigh actually used to have on-campus branches up to about 18 years ago and then a decision was made by former owners to close those branches,” Meckiffe said. “When I came on board I asked how we could make ourselves relevant and available to students, again within a 21st-century context, which has led to the development of our My Endsleigh app. The core proposition of that is around safety, security and wellbeing.”

Read more: Changing perceptions of purpose for the insurance profession

As a result of its relationships with universities, she said, the broker has a very high market share of serving the block hall accommodation providers that many students use. This has allowed enhanced accessibility in the rollout of this app, which students can download to get their insurance needs met. It’s in the interests of accommodation providers to make sure that students know they’re insured because they buy the insurance for them – a B2B2C operation.

“It was prior to my time, but there was a big fire at one of the Bolton block halls and the students didn’t actually know they were insured,” she said. “So we thought, ‘we’ve actually got a duty of care to make sure that students know they’re insured’’. An app seemed like a logical place to be, but it goes well beyond insurance.

“It also has a proposition around a 24/7, 365 wellbeing hotline, which really comes into its own for students at the moment. We had an instance recently at a block hall, where a student was on the brink of suicide. And that’s when insurance comes to life, that’s when you realise why you’re doing your job. [Our app] kicked in there with the initial intervention, but also with ongoing counselling as well.”

Looking to the next steps for this proposition, Meckiffe highlighted that since its launch in August, the app has received well over 100,000 downloads and has seen active utilisation. Its roadmap now is to hit one million. Within the charity space next year,the firm will launch its own product – which is a break in tradition for the business.

“The other area we want to go deep on is commercial insurance in universities,” she said. “We have a very high penetration in block halls, student unions but commercial insurance within universities is a bit like insuring a village because you’ve got science labs, you’ve got meeting halls, gyms and everything else. It’s a complex market, but I just think it’s something that Endsleigh should be competing in and so, we’re going to be looking seriously at that.”

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