Female drivers' '£2,000 insurance hike'

Woman drivingThe new EU Gender Directive, due to come in to force in December this year, could force premiums for some women drivers up by as much as £2,000 a year, according to the findings of a major survey by comparison website Gocompare.

Here, we investigate why this is happening and look at ways to keep costs down.

What is happening?
Traditionally, women pay less than men for car insurance because statistics show that they have fewer accidents and cause less damage when they are involved in a crash.

However, pricing insurance policies according to gender is to be outlawed later this year when the EU Gender Directive comes in to force.

The Directive, which comes in on December 21 this year, effectively bans insurers from charging men more than women for their car insurance based on the expectation of higher and more frequent payouts.

How much will my insurance premiums rise?
Official figures indicate that millions of women could end up paying an extra £362 a year, or around £30 a month, for car insurance from December this year.

However, Gocompare's Gender Watch research, which analysed more than 10 million motor cover quotes, estimates that while average premiums for women will rise by about £315 a year, or 41%, female teenagers could face price hikes of 94%, or £2,000.

This is because they will be subsidising lower premiums for male drivers of the same age, whose premiums are expected to drop by about 9% despite statistics showing that they are the most dangerous drivers on the road.

Gocompare's head of motor insurance, Scott Kelly, said: "The introduction of unisex rates is likely to have a sudden and dramatic impact as insurers seem to be holding off until the last minute."

How can I keep my car insurance costs down?
If your car insurance comes up for renewal early in 2013, for example, it may be worth switching to a new policy before December 21 - even if it means the two policies running concurrently.

Other money-saving tricks include keeping your car in a locked garage overnight – this alone could reduce your premiums by around 5% - and fitting an insurer-approved alarm or immobiliser.

You can also ensure that your cover is priced on the way you drive, regardless of your sex, age or experience, by opting for a "telematics" insurance policy, which involves your car being fitted with a "black box" that monitors how you drive.

Finally, don't forget that the best way to find the cheapest car cover is to shop around to find the best value deal on the market. Comparison websites such as Gocompare and MoneySupermarket can help you do this.

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