If the cost of driving today is prompting you to consider taking the bus, spare a thought for younger drivers — and their parents — who face monumental insurance premiums, as well as sky-high petrol bills.

Newly qualified 17-year-olds can pay £3,000 a year to insure themselves on the road, and even those in their twenties pay an average of over £100 more than their thirty-something counterparts.

Norwich Union’s decision to scrap its pay-as-you-drive scheme last week, which rewarded those who drive less with lower premiums, has also exacerbated the situation as many young people used the policy to keep the cost of cover down.

The move leaves rival More Than’s pay-as-you-drive policy aimed at the under 25s as the only usage-based motor insurance on the market.

Peter Gerrard of comparison website Moneysupermarket said: “The Norwich Union scheme offered younger drivers who were prepared to take to the roads during off-peak hours only the chance to cut their premiums by about 20%.

“However, it is not really that surprising it has been scrapped, as our research indicated more than a quarter of drivers would balk at installing one of the necessary black boxes in their cars, no matter how much it could save them.”

Existing customers will be moved on to Norwich Union’s standard plans, although it said it would offer discounts on the usual premiums.

James Tanser of consultant Watson Wyatt believes cover of this kind could make a comeback in a few years’ time, though.

He said: “This is a heavy blow for the pay-as-you-drive insurance concept, but it may eventually recover thanks to technological advances, environmental issues and government policy on road pricing.

“If, for example, the government seeks to reduce our carbon emissions by sophisticated road pricing, charging by the time of day, the level of congestion and the type of road, then interest may certainly revive.”

In the meantime, there are still steps you can take to keep motor insurance costs down — even for younger drivers.

One of the easiest ways to reduce premiums for inexperienced drivers is to insure them initially on a parent’s policy.

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