Is the under-25 motor market really in decline, or has the industry just stopped trying?
That was the question at the heart of our latest webinar, and the answer from the panel was unambiguous: the market hasn't gone anywhere. It's been pushed away.
Joining Consumer Intelligence's Ian Hughes were Ed Rochford, Chief Product Officer at IMS and co-founder of Carrot Insurance, and Sarah Vaughan, founder of Angelica Solutions and former pricing specialist at Insure the Box. Between them, they brought decades of experience at the sharp end of the young driver market, and they had a lot to say.
The session opened with a deliberately provocative framing: the data makes the case that this is not a market in decline, but one reshaped largely by insurers' own decisions. Has the industry been looking at this the wrong way?
Ian didn't hesitate. The industry tends to frame this as a young people problem. What's going on with under-25s? Why aren't they engaging? But the more honest question is what's going on with the insurers. When just a handful of providers are generating the vast majority of competitive quotes in this segment, the choice window for a young driver on a price comparison site isn't just narrow. It's almost closed. Under-25s are still showing up and searching. They're just not finding anything worth buying.
"The issue is not young people and their desire to buy insurance. The issue is that there isn't a product they want to buy." Ian Hughes, Chair and Founder, Consumer Intelligence
From a pricing perspective, Sarah was clear that this is a high-premium, naturally high-volume new business segment. New drivers enter it every year, by definition. The opportunity is real. The challenge is getting the risk pricing right, and she was honest about the fact that it's harder than it looks. But harder isn't the same as impossible, and it's a challenge she has spent years working through with clients across the market.
When young drivers can't find what they need through the front door, they find another way in. Fronting, brokers, family policies that don't quite reflect who's doing the driving. The industry has tended to treat these as problems to police. The panel saw them as signals to act on.
The safety data over the past two decades is remarkable, with a 61% reduction in young drivers killed or seriously injured, and Ed was clear that connected insurance deserves real credit for that. The technology genuinely delivers for young people on the road. But somewhere along the way, the industry turned a positive tool into something that feels punitive, and young drivers noticed.
"It does feel like telematics is still used as a set of stabilisers. More needs to be done to help people use the data beyond that initial first few years." Ed Rochford, Chief Product Officer, IMS / Trak Global Group
In virtually every other corner of personal lines insurance, price wins. But in this segment, young drivers are actively choosing to pay more to avoid a cheaper telematics product. Sarah's point was that this is not irrational consumer behaviour. It is a brand problem, and telematics needs a complete rebrand. Not just a new name, but a new proposition. Stop selling it as a monitoring tool for risky drivers. Start selling it as a way for good drivers to prove exactly that, and to carry that proof with them.
That idea of portability sparked one of the liveliest exchanges of the session. Ed described a situation that sounds almost absurd when you say it out loud: a young driver spends two years on a telematics policy, builds an excellent driving history, then at renewal the insurer quietly forgets all of it. Switches them to a standard product, prices them on old-fashioned proxies, and discards the very data that made them a good risk. "It just seems like a huge waste," he said. Ian agreed, and went further: offering a good driver a cheaper price without their own data is, in his words, utter madness. In the US, driving score portability is already becoming standard practice. The ABI laid the groundwork in the UK years ago. The infrastructure exists. The appetite, so far, has not.
Yes, fronting is fraud, and Sarah was clear on that. Customers agree to be honest when they take out a policy, and many aren't being honest. But the pricing context that sits behind it matters. Quote a newly qualified 18-year-old honestly and they're looking at premiums of £3,000 to £4,000. They can't get credit because they have no credit history. They're barely being offered instalment options. And they need to drive.
"Nobody got up one morning and said, let's make it really difficult for young drivers to get into the market. But that's exactly what has happened." Ian Hughes, Chair and Founder, Consumer Intelligence
Ian's point was that the Bank of Mum and Dad doesn't front a policy because they want to break the law. They do it because the system has been set up, not through malice but through accumulated inertia, to make the honest route almost unworkable. That is a design problem. And design problems have design solutions.
Ed raised something the industry rarely grapples with honestly. If you can measure the actual risk from telematics data the day after a policy is sold, why rely so heavily on who said what at the point of quote? The information is there. The tools exist. The question is whether there is will to use them.
The closing question was a big one: if insurers don't find a way to serve this generation, do they risk losing them altogether? Nobody laughed it off.
Sarah admitted she'd recently shifted her view on autonomous vehicles. A few months ago she'd have said they were like hoverboards, theoretically exciting but practically decades away. After spending time with the people actually building them, she's not so sure. Change in this space, she said, tends to happen very slowly for a long time, and then all at once.
Ian brought it back to something concrete. Urban young people already have real alternatives to car ownership, and those alternatives are getting better. Motor is often the first insurance product a person ever buys. Get that relationship right and you have a customer for life. Get it wrong and you may never get another chance.
All three panellists ended up in the same place. There is real opportunity in this market, right now, for insurers willing to approach it differently. The demand exists. The data exists. The tools exist. What has been missing, for too long, is the ambition to put them together properly.
Want to hear the full conversation? The webinar recording is now available to watch on demand - simply click the button below. And if you haven't already picked up our research report on the under-25 motor market, that's available to download here.