The Government has commissioned an independent review of the cost of motor insurance for young drivers, who face premiums of up to €4,500 a year.
The Department of Transport confirms that it has asked consultants to carry out the study, which will make recommendations on how to reduce the cost of insurance for young drivers.
The move fulfils a commitment made in the "Towards 2016" partnership agreement to the National Youth Council of Ireland, which claims that insurance companies are "profiteering" at the expense of young drivers.
James Doorley, assistant director of the NYCI, said that although motor premiums had come down, young drivers were still paying large amounts, and insurers were making their biggest profits out of this age group.
"The profits of motor insurance companies rose 26 per cent last year to €418 million. While costs for many drivers have come down from the very high levels of a few years ago, the cost for most young drivers has not, and they are still forced to pay exorbitant amounts," Mr Doorley said.
"It is clear that the insurance industry is pocketing the savings made from the insurance reform programme and, as a result, they are making bumper profits at the expense of younger drivers."
In 2004, insurers made an average profit of €2,266 per policy on men aged 21-24 who were on full third-party fire and theft policies, according to Financial Regulator figures quoted by NYCI.
The average cost of comprehensive insurance for a 17/20-year-old on a full licence was up to €2,970, while those on provisional licences paid up to €4,500, Mr Doorley said.
For women of the same ages, the corresponding figures were €1,917 and €2,536.
