The older drivers are being penalised by insurers

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Motor insurers are quite often criticised for their inflated premiums and inordinate delays in settling claims.

Some have even sold client details to claims firms shortly after an accident.

The Office of Fair Trading has called the motor insurance industry “dysfunctional” and not before time referred it in September to the Competition Commission.

Now come revelations that insurers are penalising older drivers.

Those aged 70 years and above are being singled out for excessively high premiums. Yet this group has a lower risk profile than drivers 40 years their junior, according to research by campaigning group Which?

The highest surcharge affects those aged 81-85 years where insurers are imposing rates 50 to 74 per cent above those for drivers aged 41-45 years.

This would make actuarial sense if the older age sector had more numerous and expensive claims.

However, the younger group is more likely to make a claim.

Motorists aged 76-80 years are similarly on the receiving end of higher premiums. This age group experiences rates nine to 23 per cent above those aged 41-45 years.

It is not as if older motorists had the same choice of insurer as younger ones.

Of the leading 30 motor insurance companies, 14 will not accept new applications if the cover is for someone over 85 years.

Yet there are 1.5 million registered to drive over this dateline.

In the naughty corner for not accepting new business if the motorist is 80 years or older are Marks & Spencer and Nationwide, the UK’s largest building society.

These examples are surprising as mutuals keep emphasising that they operate in the interests of their members since they have no shareholders.

In the good corner are Lloyds, Kwik Fit and the oldest motoring organisation, the RAC, all of whom have no upper age limit for insuring motorists.

The John Lewis Partnership will take new clients up to 99 years.