Comparison site, Compare the Market, have released their new annual report ‘The Tank of Mum and Dad’, revealing the extent of financial support that young drivers are receiving from their parents to keep them on the road.
Their report revealed that over the last 12 months over half (52%) of 17-24 year olds received financial help with motor running costs from their parents. Parents spend on average £762 per child to help with motoring costs, amounting to more than £2 billion a year nationwide.
With young drivers increasingly burdened with higher prices, parents often foot the bill. Parents are finding that they are contributing to the cost of insurance (on on average £288), repairs (costing £178 a year), taxes (£125) and even petrol (£169). In addition to covering everyday running costs, parents are also contributing an average of £2,201 to the price of their children’s first cars. Nearly a third of parents surveyed said they paid some or all of the costs incurred during their child’s first year of driving, and one in ten continuing contributions for three years.
In July 2018, the average annual insurance premium for 17-24 year old drivers reached £1,309. Young drivers pay on average £600 on their premium than the national average, with Insurance Premium Tax (IPT) adding £161 to their premium. IPT has increased from of 6% to 12% in the past 2 years. Compare the Market’s Commercial Director, Simon McCulloch, has called for IPT to be capped or scrapped for drivers under 25, in a bid to ensure driving is kept affordable for young people.