Age Matters: How Auto Premiums Change As We Do

There are a lot of factors that determine your car insurance rates. One of the biggest factors we can’t change at-will is age. However, there are some things to take note of to understand exactly how age affects your car insurance plan.

Read on to find out more!

What Are Your Rates for Car Insurance?

When the company you buy car insurance from calculates your premiums, a lot of stock is put into your age as well as any other drivers you may have on your plan. The two biggest ages to remember are 25 and 65. Being either under the age of 25 or over the age of 65 will negatively affect your premium because the insurance company statistically views these age groups of people as being more at-risk than others.

New Drivers

New drivers, such as teenagers, pay much higher premiums because they are statistically less safe than older drivers. It makes sense. Teenagers have little experience, perspective and skill compared to their older motorist counterparts. The greater rates these drivers are subjected to are based on some pretty convincing data from the Insurance Institute of Highway Safety that correlates age with increased incidents of accidents. In fact, teen drivers:

  • Drive less per year than adults yet have higher crash rates and rates of death.
  • Are three times more likely to be involved in accident associated deaths than drivers over the age of 20.
  • Are less likely to drink alcohol and then attempt to drive compared to adults, yet are at a greater jeopardy of having an accident when they do.

The reasons why teens are more likely to be involved in a crash are not just due to their lack of experience. It is also because teens in comparison to more experienced drivers:

  • Are more likely to exceed the speed limit.
  • Are not as likely to recognize when they are in a dangerous position.
  • Are more prone to tailgating.
  • Are not as likely to wear seat belts.

How New Drivers Can Save Money

Inexperienced drivers may be able to reduce their insurance rates by:

  • Participating in driver’s education
  • Being extra careful to avoid accidents when driving.
  • Buying a vehicle with exceptional safety features.

Some insurance companies also offer student driving discounts. You may also want to check if putting a teen or new driver on the insurance plan of a more experienced driver can reduce the rates a bit.

Adult Drivers

From the age of 25 until the age of 65, your insurance rates for your car are more likely to decrease over time if you aren’t involved in accidents and keep your driving record clean. You may also be able to further decrease your premiums depending on:

  • The type of car you drive and its safety features.
  • Your geographic location.
  • How far you drive per year.

Senior Drivers

It’s typical for insurance costs to increase once your turn 65. The higher cost of providing insurance for this age group, according to the Insurance institute for Highway safety, is due to:

  • Impaired vision as people age.
  • Decreased cognitive functioning through the aging process.
  • Physical changes that can impair function, such as arthritis.
  • Prescription medication use.

Statistically, senior drivers are also more likely to have more severe injuries that result from an accident that will also cost more to treat.

How Senior Drivers Can Save Money

Age may be a factor in determining premium rates, but it’s not the only one. Senior drivers may be able to maintain more affordable insurance, according to the Insurance Information Institute, by employing a few strategies like:

  • Sustaining a good driving record.
  • Participating in a driving course.
  • Shopping around for car insurance quotes.
  • Switching the main driver on the insurance policy if a senior finds they are not driving as much.
  • Shopping around for senior discounts.

Remember, most companies will happily provide a free quote when you are shopping around for car insurance. If you’re not keen on the idea of taking the time to shop insurance companies individually, you can always use sites like CoverHound, which can give you info about the average car insurance rates by age as well as a host of other car insurance data through quick information prompts.

But regardless of the path you take, you have to be diligent when it comes to your car insurance as you pass through different phases of your life. There’s no doubt that factors such as age, gender and even your marital status can impact how expensive (or inexpensive) your car insurance premiums are, but it’s up to you to understand how much your bottom line is really impacted.

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