Average Car Insurance Rates for Teenagers

If you are a young driver you probably pay a lot and want to know at what age does vehicle insurance go down? Your frustration is understandable since expensive premiums are a huge surprise for many first time buyers. Naturally, you may feel that you haven’t done anything wrong to be avoided like the plague. However, you are not alone since average rates for teenagers are high. Also companies probably feel fully justified for giving scary quotes. The fact of the matter is that they are afraid for two very valid reasons. Let’s have a look at them and see how bad the situation is and how long it will last before things get better.

Lack of Driving Experience: One of the reasons is naturally the lack of experience. Today, vehicle insurers look into many details while calculating premiums. Unfortunately, most youngsters have no experience to talk about and not much information in the way of credit history either. They may turn out to be great and stay with the provider for years without making a single claim. On the other hand, the moment they insure a young person they may have a huge accident claim in their hands. So, they are a complete mystery and this scares underwriters a lot and some scared a lot more than others. That is why one company can give you a quote as much as 6 times higher than others.

Lack of Life Experience: When you don’t know better you may feel indestructible and cannot imagine something bad happening. This is called experience and you can only get it by living. This can lead to serious risk taking knowingly or unknowingly. But a momentary misjudgement can result in a serious accident or even death when you are behind the steering wheel. This is a real worry and that is why a few of them avoid the risk.

Statistical Proof: Unfortunately, underwriters have the statistical data that backs their decision to charge expensive premiums. A beginner is about 4 times more likely to cause a deadly crash than any other group. After seeing figures like this you can understand why they may need to pay a lot more.

How Much Is Teenage Auto Insurance?

You may be pleased to know that even a 16 year old may not have to pay as high as 4 times of a mature motorist. Some of them may try their luck or want to scare away unwanted risk by quoting much higher rates. The beauty of it all is that you don’t have to accept them. If you keep checking for better quotes you are bound to find an affordable policy that will put you on the road. The key to success is keep going until you exhaust most of the options, as the prices can be all over the place and first one or two can be disheartening.

Average cost of car insurance for a 16 year old is about 2.5 times higher than for a 25 year old, who is considered to be a mature driver. This equates to $2,102 based on the US median premium for a typical policy and you may need to pay $3,312 for a full coverage automobile insurance if you have a nice car. The average premium drops to twice of a mature person when you reach 18 and 1.5 times when you turn 20.

It may look or sound unfair. However, it is fairly reasonable that drivers below 20 pay between 2.5 to 1.5 times more than over 25s once all the risks associated are taken into account. It is natural to expect that people who are more likely to cause damages pay more. There is no way of knowing who is actually going to cause an accident and that is why median statistical figures are used as benchmark for certain group of motorists.

If you want to break away from the age group and prove that you are better than your age suggests you can always opt out for a telematics insurance that will tell the carrier how good you are behind the steering wheel. So, there are solutions that can help you get the most competitive auto insurance for teenage drivers

It is important to keep in mind that the US average is very broad. Rates in your state can be much lower or higher than the US median. Also, city drivers are known to pay a lot more than the countryside ones. As you can see, where you live plays a very important role in premiums.

When Does Teen Car Insurance Go Down?

You may be wondering if it is only an age thing and rates would come down as soon as you turn 20, just like magic. Naturally, they would start coming down at some point. The toughest period for you is the first twelve months. If you can manage to complete it without a claim you can get about 20% discount. These large discounts keep coming as long as you don’t make any claim or get a ticket. Average auto insurance rates for teenagers go down about 40% by the time they turn 20. A further 20% drop is expected by 25.

Driving experience, records and claims history will be very important factors in getting the most savings. If you have been building a good coverage history since you got the license and have no accident or traffic violation ticket you should be asking for maximum discounts. The most dangerous period is early stages especially the first year of driving. If you passed those with flying colors it is not hard for companies to see that you are good at it.

Besides, rates would (should) have been coming down for every year that passed without any accidents or traffic violation tickets. Generally, good driver and no claim discounts are gradual affairs. You don’t suddenly get all of them that were withheld once you hit a certain age or certain duration without incidents. You keep getting them and reach to a maximum amount at some point, usually after three years. From then onward discounts can level out and you see very little or no drop on the premium.