MONDAY, MARCH 27, 2023
If you own or operate a motor vehicle, car insurance is essential. Car insurance, also known as auto insurance, can provide crucial financial protection for you and your vehicle while on the road and even while parked. Furthermore, in most states, you are legally required to carry certain levels of coverage.
While you may need car insurance for financial and legal reasons, it’s also important to understand pricing and coverage details. Like most types of insurance, standard auto policies require regular payments and prices may vary significantly based on several criteria, including your age.
Why Does Age Affect Car Insurance Rates?
As insurers assess your circumstances and work on providing you with a quote for car insurance, they must consider your risk level. Many factors may be analyzed during this process, with age strongly influencing your rates. Although drivers of all ages vary in their skills and level of responsibility behind the wheel, general trends and patterns make it necessary for insurance companies to adjust accordingly.
At What Age Are Car Insurance Rates Highest?
In general, car insurance premiums tend to be highest among younger drivers. This is because studies have shown higher risk among such policyholders. In fact, drivers between 16 and 19 years old are four times more likely to be involved in an accident, according to the Insurance Institute for Highway Safety.
According to a study conducted by personal finance website ValuePenguin, young drivers average the following annual premiums for car insurance:
- 16-year-olds: $7,013
- 17-year-olds: $6,016
- 18-year-olds: $5,241
- 19-year-olds: $4,136
- 20-year-olds: $3,693
- 21-year-olds: $2,977
- 25-year-olds: $1,994
The study shows a significant drop of over $5,000 in average annual premiums between the ages of 16 and 25. Furthermore, rates decrease by approximately 40% from ages 21 to 25.
At What Age Are Car Insurance Rates Lowest?
The aforementioned trend of premiums decreasing as drivers age continues throughout most policyholders’ 20s, 30s, 40s and 50s for most drivers. According to ValuePenguin, drivers in this age range average the following annual rates:
- 30-year-olds: $1,745
- 35-year-olds: $1,711
- 40-year-olds: $1,676
- 45-year-olds: $1,648
- 55-year-olds: $1,514
- 65-year-olds: $1,564
The study shows that while premiums generally continue to decrease throughout much of a policyholder’s adult life—eventually reaching their lowest at age 55—prices begin to rise again as drivers approach their senior years. Like young drivers, insurers may also view elderly motorists as having heightened risk levels.
We’re Here to Help
With over 35 years of experience serving drivers in Brick and along the New Jersey coastline, J A Campisano Insurance Agency is well-equipped to help you assess and address your coverage needs. We will work with you to understand your circumstances and explore various options to provide optimal coverage at ideal prices.
Visit our website or call 732-892-8826 to get started today.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.
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NOTICE: This blog and website are made available by the publisher for educational and informational purposes only.
It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional
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