Car Insurance: Young People

Debate between Steve Double and Jo Churchill

Monday 20th March 2017 Westminster Hall

[Steve Double]

Later in my speech, I will talk about telematics and some of the available technology. My response to my hon. Friend is that I think we need both. Yes, we need to embrace technology and use it as much as possible to help people to be safe on the roads, but I am also of the view that we can do better with the current testing regime in helping people at that very initial stage to be safer on the roads.

[Jo Churchill (Bury St Edmunds) (Con)]

Does my hon. Friend agree that the 21st-century driving conditions that my four children, his children and all the young people in our rural constituencies face on the roads mean that we need a different approach? Lessons on night-time driving and motorway driving are not obligatory. Many countries, including New Zealand, Australia and France, run a probationary period, for example, which is something that could be looked at and learned from.

[Steve Double]

My hon. Friend makes a very good point that I will come to later. I think the current testing regime needs to be more robust and more comprehensive to address the many different aspects of driving, rather than just having the very narrow test we have currently. We teach young people to pass the test. We do not equip them to deal them with the many different experiences of driving on roads in the UK today.

--- Later in debate ---

[Steve Double]

The hon. Gentleman makes a very good point. There are many pitfalls to the issue of fronting. The insurance industry should do more to address that issue at the beginning, rather than wait until there is a claim. Companies happily take the premiums before they address the problem. There is more that can be done to ensure that, when older drivers are put on policies, it is proper and legitimate.

Some insurers now offer telematics policies and fit a GPS-enabled transmitter to the car; I believe that smartphone app options are also available. Drivers under 21 who take out such a policy and have the appropriate equipment fitted are typically offered a 25% discount on the initial premiums. Such policies can also further reduce renewal premiums, as there is a record of where, when and how the car has been driven. High-risk driving behaviours are recorded by the technology and can cause renewal premiums to rise, whereas sensible driving can lead to a significant reduction in premiums.

One insurer, Marmalade, which operates a telematic policy, saw a dramatic improvement in the accident rates of novice drivers. On average, one in five new drivers makes a claim in the first six months, but with monitoring equipment in place, that number improved to one in 16—an outstanding and significant improvement. Telematics policies have been growing in number. In 2009, there were about 12,000, but the technology has become more widely known and continues to fall in price, making the policies more attractive: the number has risen quickly to more than 750,000 today.

Dash-cam technology can also be used to improve driving and can lead to a fall in the insurance price. Some insurers now offer lower costs—typically 10% lower —provided that a camera is fitted and is always activated when driving. That footage is made available should there be a claim. That irrefutable evidence can be very helpful, given that young drivers are sometimes blamed and bullied at the roadside for collisions that are not actually their fault, and there is often a presumption that the less experienced driver is at fault. Dash cams also have the effect of improving driving behaviour, as the driver knows there is a record of how the car has been driven.

Some households enter into a written agreement with the novice driver, in which behaviours such as careful, legal and considerate use of the car are set out. Both parties sign the agreement, which, although not legally binding, offers a clearly set out explanation and brings focus, consideration and thought to the very real responsibilities of driving safely. An example template can be found on the website brake.org.

As helpful and welcome as many of those things are, they fail to address the underlying issue. It is time for us to look at our system for obtaining a licence to drive. It is my view that in this country we teach people to pass the test, rather than educate and train them to become safe and competent drivers. Rhys Parker, the instigator of this petition, said to members of the Petitions Committee:

“if young people are so dangerous that the only way to get them to drive safely is forcing them to pay £200 for an advanced driving test, why don’t we just make the driving test better?”

I agree. I think he has a point.

The driving licence was first introduced in 1903, but there was no test requirement. The test was introduced in 1935, and although there have been some changes along the way, such as the introduction of the theory test in the mid-’90s, little has changed. In that time, vehicle technology has changed, cars have become much faster and we have gone from fewer than 1 million cars on our roads to more than 30 million.

The driving scene in our country has changed completely. I believe we need a better, more rigorous and comprehensive system of training and testing that is fit for our age and our roads. I suggest that passing the driving test should be seen not as a one-off, but as a process. Under what has become known as a graduated driving test, new drivers would have restrictions placed on their driving. For example, they would not be able to drive at night or on motorways, or carry more than one passenger, until they received further tuition, gained more experience and further proved their ability to drive.

[Jo Churchill]

I thank my hon. Friend for the powerful points he is making. Will he consider the fact that some young people in our isolated rural areas need that access? Headway, a brain injury charity, spoke to me about the problem it has with carers. For a young person paid the minimum wage, a huge premium is a tough barrier that can prevent them from following a career they wish to pursue.

[Steve Double]

My hon. Friend makes a good point; she represents a rural area similar to mine. As I said at the beginning, that can be a real issue. For a young person in a rural area who needs a car to get to work, get a job or access further education, the cost of insurance can be a real issue. My two young sons passed their test quite young, and we had to work with them to find the money for the insurance. It is a real issue, and we need to tackle it at source by looking at the risk, rather than artificially managing it.

Local Government Finance

Debate between Steve Double and Jo Churchill

Wednesday 22nd February 2017 Commons Chamber

[Steve Double]

The right hon. Gentleman might have been reading the notes of my speech, because that will be my main point.

We undoubtedly need to reform local government, and I broadly welcome the changes the Department are introducing to the way local government is financed, making it much more directly accountable for raising and spending its own finance and far less dependent on central Government. I also welcome the renewed interest in the Rural Fair Share campaign to address the imbalance that has existed for far too long between the levels of funding received by rural councils as opposed to predominantly urban councils.

[Jo Churchill]

rose—

[Steve Double]

I will not take any further interventions, as time is short.

Local government spending still accounts for a large proportion of central Government spending, and it is understandable that we have had to make savings and cuts while we have been dealing with the legacy of the huge and record deficit we inherited from the previous Labour Government. We have had to find those savings across government, including local government. That is the context in which we must see the current situation.

However, I welcome the Minister’s confirmation that a fair funding formula for rural councils, based on the cost of delivery and need, will be brought forward. My concern is about the timing of bringing the review forward. I remember standing on this very spot in last year’s debate, and at the last minute the then Secretary of State provided some transitional funding to ease the huge cuts that rural councils faced, to make sure that the funding gap between rural and urban councils was not further extended.

On that basis, I supported the Government position last year, with the promise that this would be looked at. It is disappointing that we are here again 12 months later and so little progress has been made in addressing the issue. I welcome the fact that some transitional funding is still available for this year, but that will run out next year and there will be no cushion to ease the impact on the rural councils and the widening of that gap.

We must urgently bring forward this review and address this issue. As I said to the Secretary of State earlier, if we do not deal with it now, the unfairness and the lack of funding for rural councils will be baked into the system when we go to 100% retention of business rates. So it is important that the review is brought forward. We can no longer live with what we in Cornwall would call a “dreckly” approach. For the uneducated, that describes something that will happen at some undetermined point in the future. It is a bit like mañana, but not quite so urgent. It feels as though that is the approach that has been taken with the fair funding review, but we need to get on with it. We need to stop talking about it and actually deliver this for our rural councils as a matter of urgency.

I am happy to say that, based on the fact that last year’s funding agreement was a four-year agreement and the fact that the majority of councils have now set their council tax, I will support the motion and the Government’s position tonight. I will do so with a heavy heart, because I am disappointed at the lack of progress that has been made, but I take the Minister and the Secretary of State at their word when they say that these issues will be addressed. I will continue to make this case as strongly as I possibly can and to work with colleagues to ensure that the unfairness that has existed for far too long is addressed so that our rural councils will be much more fairly funded in the future.