How Age Affects Auto Insurance Rates?

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How Age Affects Auto Insurance Rates?

Age can have a significant impact on car insurance rates, especially for people that are in the younger and older demographics. Car insurance companies use statistics to determine the risk a person is of getting into an accident, and age is one of the top factors on the list.

Average Car Insurance By Age

The youngest drivers are the ones that are the most expensive to insure in most cases. People on their driver’s permits and who have just gotten their licenses are at higher risk for getting into accidents, according to statistics. The rates start out the highest at age 16 on average, and they get lower each year, on average, until age 55. After that, the average rates start to go up again.

Sixteen-year-olds can pay up to $6,500 or more on car insurance per year, which is a considerable expense. By age 21, that can go down to 3,000 per year. At age 25, the average is around $2,200. That is a large drop in prices for car insurance, so the best prices for car insurance start at that age, and they continue to get better on average for another three decades, though at a slower rate.

Why Do Young and Old Drivers Pay More for Car Insurance?

A lot of that huge decrease in the early years can be attributed to experience, both in life and on the road. As this experience increases, it leads to fewer accidents, which leads to cheaper car insurance costs. Of course, other factors that affect the cost of car insurance play a role too.

There are higher average rates on auto insurance after age 55, so when comparing car insurance rates and averages people see that after this year there are increases. Reaction times start to get slower with age for many people here, vision and hearing can start to go, and general health can see declines at these ages. All of these have an effect on the car accident rates by age statistic.

Gender, marriage status, driving record, and many other factors also have an effect on rates, so while age is something that you do not have control over, there are plenty of ways that you can save money improving other factors.

How To Save Money On Car Insurance As A Young Or Old Driver

First, a few tips for saving money for everyone. Shopping around is the biggest tip. Using this site, you can compare rates, companies, and policies to get the most out of your hard earned dollars. You will also want to take a look at discounts, there are many that you could be eligible for, and they help you save money on top car insurance coverage plans.

-For Teen Drivers

If a teen joins their parent’s policy, they can save money on insurance. The parents take on some of the risk, and the result is getting lower insurance prices. The parent’s rates will go up, however, but on overall quite a bit of money can be saved.

-For Seniors Taking additional driver’s training classes can help you save money on car insurance if you are an older driver. Refresh safety techniques and learn some new ones. Many companies offer discounts for this. Also, if you are driving fewer miles, let your car insurance company know, it may save you money.