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In this article, we’ll explore how average car insurance rates by age and state can fluctuate. We’ll also take a look at which top auto insurance companies give the best discounts on car insurance by age and compare them side-by-side.

 

In this article:

Average Car Insurance Rates By Age

So why do average car insurance rates by age vary so much? Basically, it’s all about risk. According to the Centers for Disease Control and Prevention (CDC), people between the ages of 15 and 19 accounted for 6.5 percent of the population in 2017, but they represented 8 percent of the total cost of accident injuries. The risk of an accident is highest among brand new drivers as well. 16-year-olds are 50 percent more likely to crash than 18- and 19-year-olds.

When an insured driver gets into an accident, it’s the insurance company that cuts the check. That’s why insurance companies charge more for high-risk drivers. You might be the most cautious 16-year-old driver around, but you’ll still have high rates because of your age.

Generally, auto insurance rates start high when you get your license. They decrease through your 20s and bottom out in your 40s. After you retire, the average cost of car insurance starts to pick up a bit. Rates for drivers in their 80s get expensive again, though not as expensive as rates for new drivers.

Below is a chart that compares crash data and yearly average car insurance rates by age. The rate data comes from the AAA Foundation For Traffic Safety, and it accounts for any accident that was reported to the police. The average premium data comes from The Zebra’s State of Auto Insurance report. The prices are for policies with 50/100/50 liability limits and a $500 deductible for comprehensive and collision coverage.

Age group

Crashes per 100 Million Miles Driven

Fatal Crashes

Average Yearly Premium

16–17 

1,432

3.75

$6,100

18–19 

730

2.47

$4,334

20–24

572

2.15

$2,350

25–29

526

1.99

$1,608

30–39

328

1.20

$1,449

40–49

314

1.12

$1,396

50–59

315

1.25

$1,296

60–69

241

1.04

$1,325

70–79

301

1.79

$1,556

80+

432

3.85

$2,847

 

Typically, people between the ages of 30 and 65 find the best car insurance rates on average. As people get older, they start experiencing problems with vision and cognitive abilities, which are important for driving skills. According to the National Highway Traffic Safety Administration, 85-year-old men are 40 percent more likely to get into an accident than 75-year-old men.

Looking at the table above, you can see that there is a direct correlation between the crash rate for an age group and that age group’s average insurance premium. You can also see that the fatal crash rate for drivers above the age of 80 is almost the same as the rate for 16- and 17-year-olds.

Auto Insurance Provider Comparison By Driver Age

 

Discounts for Teens/New Drivers

Discounts for Students

Senior Discount

Defensive Driver Discount For Seniors

Our Rating

Geico Auto Insurance

-

15%

-

10%

4.5

State Farm Auto Insurance

15%

25%

-

8%

4.5

Liberty Mutual Auto Insurance

30%

-

-

5%

4.0

AAA Car Insurance

7%

14%

-

10%

4.0

The Hartford Auto insurance*

Varies

Varies

-

10%

4.0

Nationwide Car Insurance

-

-

Varies

5%

4.0

Farmers Auto Insurance

-

-

Varies

10%

4.0

Travelers Auto Insurance

8%

-

-

10%

4.0

American Family Auto Insurance

-

-

-

10%

4.0

Auto-Owners Car Insurance

-

20%

-

-

4.0

Erie Auto Insurance

20%

-

-

-

4.0

Esurance Auto Insurance

-

10%

10%

5%

4.0

 
*The Hartford is only available to members of the American Association of Retired Persons (AARP), however, policyholders can add young drivers to their policies and get discounts. 

This table compares available discounts for students and seniors from a few major car insurance providers. However, you might find better rates through another company that doesn’t have a specific student or senior discount. You could also find a good rate through a local provider in your area. When shopping locally, see if you can find customer reviews from a source besides the company website.

Our Recommendations

If you’re a student or young person, our recommendation would be to check out State Farm auto insurance after looking at average car insurance rates by age. The company has a 25 percent discount for good students, and that’s the highest good student discount around. If you have a good driving record, you can also participate in the company’s Steer Clear program and get another discount of 15 percent.

Esurance auto insurance has the best discount for seniors out of the companies we reviewed. Combined with a defensive driver discount, it can be a great option for people who want to keep driving into their golden years.

 

Average Car Insurance Rates By State

Here are the top 10 most expensive and least expensive states for car insurance, according to the Insurance Information Institute:

Most Expensive

Cost

Least Expensive

 

New Jersey

$1,309.29

Idaho 

$599.77

Louisiana

$1,302.11

Iowa

$628.10

New York

$1,301.64

North Dakota

$639.10

Michigan

$1,270.70

South Dakota

$648.01

Florida

$1,259.55

Maine

$650.38

Washington D.C.

$1,246.80

Wyoming

$677.53

Rhode Island

$1,193.58

Wisconsin

$688.32

Delaware

$1,159.86

Vermont

$691.56

Massachusetts

$1,096.53

Indiana

$692.29

Connecticut

$1,086.17

North Carolina

$699.91

 

As you can see, average car insurance rates by state vary widely. Idahoans pay the least for car insurance, while New Jerseyans shell out the big bucks for coverage. Remember, these are just averages. If you live in downtown Des Moines, your premium will probably be more than the state average. On the other hand, if you live in upstate New York, your policy will probably cost less than the state average. Use this tool to see how your exact location will affect your rate:

 
 

Minimum Coverage Requirements

All states have financial responsibility laws that require drivers to carry minimum car insurance coverage. You can only forego coverage in two states – Virginia and New Hampshire – but you are still financially responsible for damage that you cause. Other states may allow you to purchase a surety bond or deposit money into an account with the DMV, but compensation for other drivers ultimately comes out of your pocket under those circumstances.

When you carry a policy, the insurance company will cover injury and damage claims. Even though your premium can seem expensive, paying for insurance is much better than paying for $40,000 or $60,000 in damages out-of-pocket.

It’s also important to know that state minimum coverages probably won’t protect you in the case of a catastrophic accident. For example, many states require liability insurance with the coverage limits of 25/50/25. That provides bodily injury coverage of $25,000 per person and $50,000 per accident, as well as $25,000 for property damage.

Bodily injury doesn’t just cover medical bills – it also covers lost wages. If you cause an accident that seriously injures somebody, $25,000 might not cut it. Just one bad accident can financially ruin a driver without enough coverage. The Insurance Information Institute recommends you carry coverage of 100/300/100.

Also, no state requires collision or comprehensive car insurance. It’s a good idea to carry these to protect damage to your car. About 70 percent of drivers choose to add these options and get full coverage.

List Of No-Fault States 

Some states have no-fault insurance systems. In a no-fault system, drivers seek medical compensation from their own insurance companies no matter who caused the accident. No-fault states require drivers to carry personal injury protection (PIP) to cover medical expenses. In some situations, a no-fault system can drive up insurance costs.

For example, Georgia used to have a no-fault system until 1991. The state only required $2,500 in minimum PIP coverage. It also allowed people to sue one another if their injury damages exceeded $500. In this situation, many accidents went to small claims court and drove up costs for everyone. However, no-fault states aren’t always expensive. Below is a list of no-fault states ranked from most expensive to least:

Why Do Car Insurance Rates Change?

Looking at average car insurance rates by age and state makes you wonder, what else affects rates? The answer is that auto insurance rates can change for many reasons. The most common cause of a rate increase is filing a claim. An at-fault accident can raise your rate as much as 50 percent over the next three years. If you were convicted of a DUI or perpetrated a hit-and-run, your rates will go up even more.

However, you don’t have to be in an accident to experience rising rates. Overall, car insurance tends to get more expensive as time goes on. In your situation, this can happen for a variety of factors. Remember, when you buy insurance, your money goes into a pool to compensate for other drivers’ claims. If the general cost of claims in your area increases, your premium will also go up, whether or not you filed a claim. Cars with smart technology and advanced safety features cost more to repair, and an influx of these vehicles can drive up local rates. Also, if your state has a spell of natural disasters, rates will increase to cover the increase in comprehensive auto claims.

Since premiums can be expensive, you might assume that car insurance companies are just getting rich off of what they charge drivers. However, auto insurance losses and expenses actually exceeded written premiums in the industry from 2008 to 2015.

More Ways To Save On Auto Insurance

You can’t control your age, and you probably don’t want to move states just to save on car insurance. Fortunately, there are a number of other discounts that you might be able to capitalize on right now. Here are a few of them:

  • Good driver: Many companies give you the biggest discount for having a good driving history. If you haven’t made any claims in recent years, you could save a lot on car insurance.
  • Multi-policy: Also called bundling, you can get discounts for holding more than one insurance policy with the same company.
  • Multi-car: The same thing goes for insuring multiple cars with one company.
  • Homeowner: Maybe you’re not in school anymore, but you aren’t old enough for a senior discount, either. Well, if you own a home, you could get a homeowner discount from a number of providers.
  • Loyalty: Get a discount for sticking with the same company for multiple years. Here’s a secret: You can always compare rates each term to see if you’re getting the best price, even with your loyalty discount.
  • Usage-based: Programs like Progressive car insurance’s Snapshot track your driving habits and can issue discounts based on good driving. However, some can also raise your rates if it turns out you’re not a good driver.
  • Financial stability: Some companies give you a discount for having a great credit score. Looked at another way, you can avoid higher rates that come with having a poor score by maintaining a good one.

When searching for a quote, it’s a good idea to call the insurance company and ask if there are any more discounts that apply to you. Sometimes, online quote forms might not account for your unique situation. If you want to make this call short, you can get your quote online before you call in and discuss it with an agent. An agent can also make sure each discount is applied in the right order to give you the best deal.

Frequently Asked Questions

How much should car insurance cost a month?

Average car insurance rates by age can vary widely. For a middle-of-the-road full coverage policy, you’ll pay around $420 per month if you’re a teen and $170 if you’re in your 20s, according to The Zebra’s State of Auto Insurance report. After that, average monthly prices are between $100 and $140. Drivers who are 80 years old or more will pay around $170 per year. If you choose a higher deductible or less coverage, you’ll pay less.

At what age is car insurance cheapest?

Car insurance will usually be the cheapest for drivers between the ages of 30 and 65, all else being equal. Of course, new claims can always push up your rates at any point in life.

How much is car insurance for a 20-year-old?

A 20-year-old can expect to pay around $3,000 per year for full coverage if they have a good driving record. Depending on your situation, the quotes you receive could be higher or lower.

How much is car insurance for a 25-year-old?

A 25-year-old driver with a clean record will typically pay about $2,000 per year for full coverage. Remember, that’s just an average rate – you might find different prices.

What state has the highest car insurance rates?

New Jersey drivers pay the most for car insurance, according to Insurance Information Institute data, at about $1,309 per year.

What state has the cheapest car insurance?

With an average of $599 per year, Idaho has the cheapest car insurance. Drivers in Iowa, the Dakotas, and Maine can also find cheap car insurance.

How much should you pay for car insurance?

Put simply, you should pay the lowest rate you can find for the coverage level that you need. If you’re a 22-year-old and you want full coverage with perks like roadside assistance, $2,500 per year might be a great price. However, that would not be a good price for a 45-year-old with a clean record. Always get quotes from at least three companies to compare your options.

 
 

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