Car insurance rates for young drivers can be incredibly expensive, but does your car insurance premium go down when you turn 25? based on bankrate study of average premiums, potentially yes. The average cost of auto insurance for 25-year-olds is $2,176 per year for full coverage and $654 per year for minimum coverage.
This is still more expensive than the average cost of auto insurance for seniors, and it’s important to note that auto insurance rates vary from person to person. So should you expect a drop in car insurance rates once you turn 25, and by how much? bankrate has the answers.
Does your insurance go down at 25?
According to Quadrant Information Services rates for the average cost of car insurance for all age groups, car insurance rates for 25-year-olds typically end up being lower compared to other young drivers .
“Typically, once you turn 25, your rates are going to be a little bit better,” said Robert Passmore, vice president of personal lines policies at the American Property Insurance Association. Passmore added that when he turns 30, insurance companies consider him an adult and his rates will improve again if he maintains a clean driving record.
The average rates of the largest auto insurance companies by market share support this trend. The table below shows the average cost of a full coverage policy from these insurers for 25-year-olds and how rates compare for 24-year-old and 18-year-old drivers.
*rates reflect a 25 year old renter on their own policy, a 24 year old renter on their own policy, and an 18 year old renter on their parent’s policy.
How much do rates drop for 25 year olds in each state?
Based on average US fee bankrate sampling. In the US, young adult drivers can generally expect significant reductions in car insurance costs at age 25.
The five states below have the largest percentage reduction in average premiums among 24- and 25-year-old drivers.
- mountain: -22%
- vermont: -21%
- wyoming: -20%
- Pennsylvania: -19%
- michigan: -19%
- Your state does not take age into account. Some states have different regulatory restrictions on what can be used to calculate auto insurance rates. Hawaii and Massachusetts are the two states that do not allow the driver’s age to be taken into account in determining your auto insurance premium.
- You have some marks on your driving record. Distracted driving can lead to a speeding ticket or an at-fault accident, which could also result in a surcharge on your insurance policy of automobile. these marks could eliminate the good driver discounts on your policy that were earned by maintaining a clean driving record.
- You most recently received your driver’s license. When you get your driver’s license, it matters what rating insurance companies give you. drivers who start driving at age 16 have nearly a decade of driving experience by the time they turn 25. on the other hand, a first-time licensed driver at age 20 has less driving experience and could see higher rates thereafter.
- where do you live
- the make and model of your vehicle
- how often you drive
- your credit history (in most states)
- your gender (in most states)
- your marital status
- your driving record
will my car insurance premium go up after an accident?
when does your car insurance drop?
how can I lower my auto insurance premium before age 25?
bankrate uses quadrant information services to analyze rates for all zip codes and carriers in all 50 states and washington, d.c. rates are weighted based on the population density of each geographic region. Rates quoted are based on 25-year-old male and female drivers with a clean driving record, good credit, and the following total coverage limits:
- $100,000 bodily injury liability per person
- $300,000 bodily injury liability per accident
- $50,000 property damage liability per accident
- $100,000 uninsured motorist bodily injury per person
- $300,000 uninsured motorist bodily injury per accident
- $500 collision deductible
- $500 comprehensive deductible
To determine minimum coverage limits, Bankrate used minimum coverages that meet each state’s requirements. our sample drivers own a 2020 toyota camry, commute five days a week, and drive 12,000 miles a year.
These are sample rates and should be used for comparison purposes only. their quotes may be different.
age: rates were calculated by evaluating our base profile with ages 18-60 (base: 40 years) applied. Depending on age, drivers may be renters or owners. Age is not a contributing qualifying factor in Hawaii and Massachusetts due to state regulations.
Gender: The following states do not use gender as a determining factor in calculating premiums: California, Hawaii, Massachusetts, Michigan, North Carolina, Pennsylvania.
*rates reflect a 25 year old renter with their own policy and a 24 year old renter with their own policy.
**age is not a contributing qualifying factor in hawaii and massachusetts due to state regulations.
how gender affects auto insurance rates at 25
Insurance companies also take gender into account when it comes to auto insurance rates, although in some states it is excluded as a rating factor. Statistically, female drivers have fewer behind-the-wheel incidents compared to male drivers, including fewer DUIs and less serious crashes. this means less risk for car insurance companies, as evidenced by the lower average premium for 25-year-old female drivers compared to 25-year-old male drivers below:
ways to save on car insurance as a 25 year old driver
While teen drivers can often receive more competitive car insurance rates if they stay on their family’s policy compared to buying their own stand-alone coverage, young adult drivers may not be able to stay on their family’s policy. their parents if they move house. . If you’re a 25-year-old driver, talk to a licensed auto insurance agent about how to find the best auto insurance for your needs and what can help you lower your premium. Asking about car insurance discounts for 25-year-olds can also help if you switch to your own policy.
If you avoid accidents and traffic violations between the ages of 16 and 24, chances are you’ll get a better insurance rate when you turn 25. When you turn 25, ask your insurer to review your policy, he advised. Amy Bach, executive director of the insurance consumer group United Policyholders. “You should always ask,” she said. “don’t wait for them to offer you a discount or rate reduction.”
why you may not save on car insurance when you turn 25
Although average car insurance premiums show that 25-year-old drivers receive lower car insurance rates compared to 16-24-year-old drivers, this may not always be the case. Some of the scenarios below could be attributed to why your rates have not decreased as expected, but the most accurate information will come from your insurance agent.
other factors that may affect your premiums
Age can be a critical factor in determining your auto insurance premium, but it’s only part of the qualification process. Other auto insurance qualifying factors may also play a role in your final premium estimate, including these factors below:
Each company weighs all of these elements differently, so auto insurance rates will vary depending on which insurance company you request a quote from. Certain things, like driving safely to avoid accidents and traffic violations, maintaining a good credit score, and your coverage selections, might give you the best advantage when shopping for an affordable auto insurance policy.