When Does Car Insurance Go Down?
Because young drivers – especially teens – pose a higher risk for getting into accidents than other age groups, their insurance rates are higher. But what age does car insurance go down? The cost of insurance tends to go down around age 25, but that depends on your driving record.
Why Auto Insurance For Teens Is So Expensive
When you add a teen driver to your insurance coverage, you can expect to pay a higher premium. Car insurance rates are determined by the amount of risk a driver poses to an insurance company. This risk is determined by average driver statistics. Insurance companies want to protect themselves, so they charge a higher rate for drivers who are more likely to get into an accident, file a claim, or get a moving violation.
According to the Centers for Disease Control and Prevention, a person’s crash risk is the highest during their first year of driving. 16- to 19-year olds are nearly three times more likely to be in a fatal crash than drivers age 20 and older. They have less experience driving, so they are more likely to have an accident on average.
Crashes with teenage drivers in America are often the result of the following:
• Inexperience with driving
• Distracted driving
• Driving with other teenage passengers
• Impaired, reckless, or drowsy driving
• Driving at night
Does Car Insurance Go Down When You Turn 25?
If you’re a young driver or the parent of a teen, you may be wondering when you can get some relief from high auto insurance rates. At what age do car insurance premiums go down?
Auto insurance rates can decrease when you turn 25, but each person’s individual driving history is a deciding factor. Speak with your auto insurance agent to understand your premium and learn your options for an age discount.
Experience And Safe Driving
Many drivers see decreases in car insurance rates after they gain more driving experience, avoid getting tickets, and avoid accidents. Unfortunately, there is no guaranteed time when car insurance rates will go down automatically. It all depends on the amount of driving experience you have and how long you maintain a safe driving record.
For instance, if you get your license right when you turn 16 and maintain a clean driving record for a few years, you should start to see lower rates once you reach your mid-20s. However, if you get your license later in life, like at age 23, you might not be eligible for lower rates once you turn 25. This two-year driving history may not be long enough to prove to insurance companies that you have lowered your risk.
To maintain a clean driving record, keep these safe driving tips in mind:
• Limit the number of other teen passengers and distractions. Never drive with your phone in your hand or while eating.
• Practice with a parent to master good driving skills. Drive in different conditions like rain, after dark, during heavy traffic, and more to become comfortable on the road.
• Continue learning as a passenger. Pay attention to how adult drivers handle various situations on the road, and keep them in mind when it’s your turn to take the wheel again.
• Stay up to date on driving laws. Make sure you’re compliant in your city.
Does Car Insurance Go Down When You Turn 30?
Maybe your rate went down in your mid-20s, but now you’re approaching another milestone. At what age does car insurance go down in your 30s?
Many auto insurance companies decrease rates after you turn 30 because you’ve gained many years of driving experience. However, like turning 25, turning 30 does not automatically qualify you for a discount. Your insurance provider will look at the number of years you’ve been driving and your driving record in recent years. This will help determine any changes in your premium.
As you gain experience and continuously drive without accidents or tickets, you’re more likely to see a decrease in your auto insurance rates.
How Insurance Rates Change As You Age
When you are young, you may see a decrease in car insurance rates each year you drive without getting moving violations or filing claims. Rates generally decrease as adults reach their 30s, 40s, and 50s. Mature adults pose less of a risk to insurance carriers, and they are often rewarded with savings. Having years of experience and proving you are a good driver is a positive sign for insurance companies.
Unfortunately, rates may go up again when you become a senior over 65 years old. Elderly people are considered high-risk for auto accidents, as their physical abilities begin to change. For instance, impaired vision or physical ailments like arthritis can affect the ability to drive safely. Still, some companies offer a discount for senior drivers.
The cost of auto insurance varies by age and state, so you should do your research to learn what you can expect from your insurance premium as you get older. We recommend getting multiple quotes to compare your price options:
What Else Affects Your Car Insurance Rate?
In addition to age and driving history, here are some other things that can affect average car insurance rates:
• Gender
• Location
• Marital status
• Credit score
• Type of car you’re insuring
• Safety features on your vehicle
While many factors like age and gender are out of your control, there are still many things that could qualify you for lower rates. For instance, married couples often pay less than single individuals.
You can also lower your car insurance premium by maintaining a good credit score. Make sure to pay your bills on time and work to reduce your debt. Next, the area you live in will impact your rates. Living in a metropolitan area with dangerous driving conditions or heavy traffic may mean you’ll pay more than someone in a less populated small town.
Last, sedans and family cars are generally less expensive to insure. That’s because they are relatively cheap to repair and safer on the road. On the other hand, foreign and luxury cars are considered a high-risk for car insurance companies because parts are expensive. These cars are also more susceptible to theft and reckless driving.