Young motorists could save up to £500 on their car insurance by taking advanced driving lessons under a government plan to encourage people to continue improving their driving skills throughout their lives.

The courses will be open to all drivers, but will lead to the greatest insurance savings for newly qualified drivers, who currently pay premiums of up to £2,000 a year.

Ruth Kelly, the Transport Secretary, met leaders from the insurance industry yesterday to discuss the possible course content and the likely level of discount.

The industry is understood to be willing to offer to reduce premiums by about 25 per cent for drivers who have completed courses.

Motorway driving and emergency braking at high speed are among the skills that are likely to be included in the course, which will be developed and approved by the Driving Standards Agency .

Advanced driving skills are already taught by various different bodies but very few drivers bother to pay for extra tuition after passing their tests. More than half a million people gain driving licences each year but fewer than 10,000 go on to take the advanced driving test.

A Department for Transport source said: “We want people to go on improving their driving skills throughout their driving careers. This is about creating the right sort of education and incentivising people to do it.”

Edmund King, president of the AA, said: “Learning advanced driving skills has been shown to reduce the risk of crashing by up to 35 per cent.

“Millions of today’s drivers passed their tests before technology such as ABS brakes and electronic stability control was available, and may not be familiar with how they affect their car. Most drivers would benefit enormously from additional training.”

The new courses are part of a wider initiative on improving road safety through developing better driving skills.

The DfT will also announce today a more rigorous training and testing system for learner drivers, including a requirement for professional tuition.

A survey of 17,500 AA members found that 73 per cent believed that learner drivers should complete 40 hours of compulsory tuition before taking their test.

The survey also found that 69 per cent supported a limit on the number of passengers a newly qualified driver could carry.

However, the Government has decided not to impose restrictions on young drivers who have passed their tests.