The cost of car insurance generally declines the most between 18 and 19 years of age, when rates drop by about 25% on average. In general, auto insurance premiums continue to fall every year until age 25, when rates begin to stabilize for the next few decades. When you look at average car insurance costs by age, you might see a trend. Coverage starts out relatively expensive for teens and young adults.
Over the years, premiums generally decrease as drivers gain more experience behind the wheel. However, as drivers reach old age, premiums may rise again. In general, this is due to the risk factors associated with each age group. Based on our research on average car insurance rates by age, the best age to take out car insurance is between 30 and 60 years old.
Right now, insurance companies no longer see you as a “high-risk driver”. Risk calculation is how auto insurers set insurance premiums. The more likely you are to have an accident and need to use your insurance, the more you'll pay in premiums. When calculating car insurance prices, companies consider experience to be one of the most critical factors.
Young drivers are less experienced and tend to be riskier to insure, so they are charged higher rates than more experienced drivers. Assuming that the driver's record is clean, the cheapest car insurance rates usually go to middle-aged drivers around 50 years old. Young drivers see significant declines in car insurance prices each year, but rates stabilize as they age. The table below shows the sample costs of car insurance rates with full coverage for 16 to 18 year olds.
Compare the cost of getting an individual policy with the cost associated with adding it to your parent's policy. For more context, the average cost of an individual policy for a driver aged 19 or older is also shown. The difference between what young people aged 24 and 25 pay on average for car insurance is relatively small, only 11%. When you receive a car insurance quote, your insurance company uses several criteria to assess your level of risk and calculate your rate.
During this period, you don't pose the least risk to auto insurers because you have more experience on the road and aren't in a vulnerable position because of your age. Car insurance companies use many factors to determine your premium, and in most states, your age and gender are among the most important. Drivers in their twenties may no longer be able to take advantage of student discounts, but there are plenty of other ways to save on car insurance. State Farm's average car insurance rates drop by about 13% between ages 24 and 25, and in Progressive, they drop by about 11%.
We identified the following rating categories based on consumer survey data and conducted extensive research to formulate rankings of the best auto insurance providers. The reason car insurance is higher for a person under 25 years old is because younger drivers are statistically more likely to have an accident than older drivers, making it riskier for companies to insure them. Buying an auto insurance policy can be a confusing process, especially since there are so many factors that affect your premium. Drivers looking for cheap car insurance should consider USAA and Geico, as these two companies offer cheaper rates to young drivers than Progressive or State Farm.
In general, young drivers can expect to pay higher rates than older drivers, and around 70%, car insurance rates begin to rise again. We've done an in-depth analysis of the auto insurance industry and found the best auto insurance companies based on affordability, coverage options, and more. The first step in finding the best car insurance for your circumstances is to figure out what factors matter most to you.