Young provisional drivers pay the highest car insurance premiums in Australia, with new research showing 17-year-old P-platers face average annual premiums of $3897.

Compare the Market analysed quotes from eight insurers and found 17-year-old P1 drivers paid about $580 more on average than 16-year-old learner drivers, while premiums generally fell as motorists gained experience.

Average premiums dropped by about $1000 for 18-year-old P2 drivers and continued to decline until drivers reached their mid-60s, before gradually rising again in older age groups.

Compare the Market’s economic director David Koch said insurers based premiums on risk, with younger drivers statistically more likely to be involved in serious crashes.

The research also found premiums for a 17-year-old P-plater could vary by as much as $1219 between insurers, with motorists urged to compare policies before renewing.

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