Twenty five isn’t normally an age that is considered a milestone. However, it is a milestone in terms of auto insurance. You come across this age many times in policies and even on hire contracts. For example, some policies only allow occasional drivers who are over the age of 25. So, does vehicle insurance go down at twenty five? Generally the answer is “yes it should”. However, there are no hard and fast rules that have become the norm in the industry.
You can see it confirmed in some auto insurer websites and publications that by turning 25 you may move into a more mature and lower risk driver group. That is why you may start getting better rates according to esurance although they say that they cannot generalize this statement. For example, you cannot expect your rates to sharply fall just because you turned twenty five year old, especially if you have only couple of years of driving experience. This makes sense since at this age you are expected to be a good driver with years of experience. Providing you meet this general assumption you should see some drop in your premium after you turn twenty five.
Furthermore, people in the industry reports from experience that generally, car insurance does go down at twenty five. This belief is tested by using online quotes by a reputable website (carinsurance.com) and they found that rates can decrease as much as twenty percent.
Why Does Auto Insurance Go down at Twenty Five?
Make no mistake that age is one of the factors in premium calculations. The younger a driver is the higher the rates will be. Younger drivers are high risk for auto insurers because of age related tendencies and inexperience in life and driving. In time they learn to slow down and observe the road ahead and other drivers. The ones who learn from near misses turn out to be good drivers.
25 is an age that is commonly agreed upon to be some sort of crossover point where you are accepted to be statistically more reliable driver. Actually it is more to do with how risky drivers between the age of 16 – 24 are in comparison with say 25 – 35. Many reports by organizations such as the Insurance Institute of Highway Safety (IIHS) and National Highway Traffic Safety Administration (NHTSA) confirms that drivers who are younger than 25 are higher risk. Of course, you don’t arrive to this age overnight and that learning curve makes you a wised up driver who deserves some car insurance discounts.
Ages of Listed Drivers Affect Auto Insurance Premiums?
Age is a statistically significant data for vehicle insurers. When they look at the accident and claim numbers they see that younger drivers are topping the chart. They cause a lot more accidents and these tend to be a lot more serious and fatal. Therefore, it is no surprise companies like to stay away from insuring teenagers unless they are seriously compensated for taking high risks by high premiums.
Another problem with the teenage drivers is that they have no history to tell if their driving is good or bad. As they start building good driving records they see their rates dropping gradually. The age 25 is significant because rates drop more once they reach this age. Also, this is the age most companies look at when they are considering a particular risk. For example, some companies may not insure drivers under this age with sports cars.
What Does CheapAutoInsurance.net Thinks?
Does your vehicle insurance premium fall when you reach 25 years of age? We believe it is significant in terms of automobile insurance and you are not wrong to expect some discounts after passing this milestone. Of course, the size of the discount will vary depending on your own driving experience and history as well as your insurer. For example, carsdirect believes that male drivers should see 20 – 25% premium decrease at 25 while female drivers would only see 12 – 15%. This makes sense from risk point of view since young males are proven to be much higher risks than young females.
Furthermore, your age may influence your insurability in some cases. For example, most companies wouldn’t insure people under the age of twenty-five with certain sports cars no matter how good drivers they are.
Does That Mean Youngsters Cannot Get Discounts?
Companies always look for signs and take them into account. For example keeping good grades at school can qualify a youngster for much appreciated discounts. There may also be other discounts that everyone can claim regardless of age. For example, paying the full premium at the start or completing an advance driver course would qualify them for discounts too.
Shopping around is another good way of bringing the premiums down no matter what age you are. There could be sizeable differences between auto insurance quotes. It is an open market and every company sets own rates. While one company is very cautious about youngsters the other may make it their business to insure this group of people predominantly.