Your Age and Your Car Insurance

Car insurance premiums are based on numerous risk factors. These factors include location, miles driven, the number of accidents, experience, credit, car value, and even age. Experience and age are not mutually exclusive, as a new driver may be older than thirty, but have little to no experience. On the contrary, a new driver may be only eighteen, and depending on the state in which he or she lives, may have as much as three or four years driving experience. Nonetheless, each of these factors is weighted differently to assess the true risk to the insurer regarding the new insured.

The Magic Numbers

Over the years, insurance companies across the board have found that there are two ages in which people change their overall risk factors. The first age is 25. At 25, you will notice a dramatic decrease in your insurance premium, assuming you have maintained a clear driving record. It is widely believed that once a driver reaches age 25, he or she becomes an experienced driver and a mature individual. Statistics have shown that once a driver reaches the age of 25, he or she causes fewer collisions and report fewer incidents.

The other magic number is 65. Most insurance companies perceive people age 65 or older a higher risk than someone between the ages of 25 and 65. Once a driver reaches age 65, he or she will notice an increase as opposed to the decrease the driver has enjoyed over the prior forty years. These drivers are Senior drivers and statistics often show that senior drivers tend to lose faculties, making driving much more dangerous.  

The Small Advantage

While senior drivers experience a rate increase as they age, the increase will never be enough to emulate the rates they paid as teenagers, unless they have an accident. Seniors have a small advantage over new or young drivers which adds a lot of weight to the overall calculation. Senior drivers have years of experience driving. Therefore, they are typically able to navigate any driving situation as any experienced driver can. A new driver under the age of twenty has neither the maturity nor experience to handle all the situations which may occur while driving, making them an overall higher general risk.

It is also important to note that while, not entirely age related, young boys, under the age of 25, will be the most costly to insure. While it may appear biased on many levels, statistics show that the majority of automobile accidents occur at the hands of young male drivers, which becomes a large risk to the insurance company. There are some factors that may help lower these rates which should always be considered. These factors include taking a driver’s education class that includes behind the wheel experience, maintaining an excellent driving record, and even maintaining a higher GPA in school.

NO matter your age or gender, you should be a savvy shopper. Shopping several different insurance companies to obtain a good quote is not only a great idea, but is the only option of a smart buyer. To learn more about how Protective Insurance Agency can help you save money, contact us at (877) 739-9367.