There are a lot of different factors that go into determining how much you’ll pay for car insurance, and many of them are in your control: keep out of trouble, always drive the speed limit, keep a good credit score, and avoid risky behavior. These actions will help your rates will remain low. Getting married also helps, as does sticking with the same insurance carrier for years.
However, there are many factors that impact how much you’ll pay that are out of your control—and your age is one of them. As you might imagine, the youngest drivers on the road are perceived as the riskiest; therefore, insurance companies charge more in premiums for them. You might be surprised to know that getting closer to retirement age can also cause your premiums to creep upward.
How Much Does Car Insurance Cost?
The chart below shows the average cost of car insurance by age, starting at age 20 and going to age 75.
As you can see, car insurance is significantly more expensive when you’re a very young driver, and it starts going down as you get more experience on the road. Once you’re over the proverbial hill, the rates start to climb back up again.
It pays to be a more experienced driver. Even as you begin to reach your senior years, you’ll likely never pay more for car insurance than when you’re first learning how to drive. Recommended liability coverage is nearly $1,500 more expensive per year for a 20-year-old on average than it is for a 75-year-old on average. Even the statewide minimum coverage is much more expensive for a young person than it is for an older person.
Car Insurance For Young Drivers
Why is car insurance so much more expensive for young drivers? It's nothing personal. Insurance companies are in the business of making money, and they do so by calculating how risky each particular driver is and charging appropriately.
Statistically, young drivers are much more likely to be in a car accident than older drivers are. As such, their rates are higher.
How to Get Better Car Insurance Rates
No matter your age, there are some steps you can take that apply to everyone. First and foremost, do your best to always follow any and all traffic safety laws—and that includes speeding. Don’t take risks like driving under the influence of drugs or alcohol, and do your best to avoid driving in dangerous conditions.
It almost always pays to shop around for car insurance, too. The more you compare rates, the more information you’ll have to help you make the best decision.
Another often overlooked thing that can save you money is driving your car less frequently, or parking it in a safer area. If you are commuting to and from work every day or storing your vehicle in a "dangerous" zip code, the insurance company may feel there's a larger risk of your car being damaged. Even situations like this can cause your insurance rates to go up.
Keep an Eye Out for Discounts
If you are a young person living at home, it almost always makes sense to be on your family car insurance plan—especially if your parents are footing the bill. Having multiple cars under the same policy could net you a multi-car discount.
On the other hand, if you have a risky driver living under your roof, then listing them as a non-driver on your policy and having them get their own coverage could end up saving you money.
There are several steps that young drivers in particular can take to reduce the amount of money they pay in car insurance premiums. Taking a driver’s ed class is a great way to learn road safety, which can help you avoid accidents and might net you a discount. In addition, students in high school and college can generally get a discount for having good grades.