It’s not cheap being young. If you’re under 25 and you’ve noticed you’re paying quite a bit for car insurance, it’s not a coincidence.
Age is one of the main factors that insurance companies consider when calculating a car insurance quote. For an insurance company, a driver’s age is a huge indication of driving experience and accident risk.
Typically, the more years behind the wheel that a driver has, the less likely they are to get into an accident and file a claim. And that means that they will cost less to insure, which means cheaper premiums.
While car insurance rates have gone up for everyone, drivers under 25 are probably paying some of the highest rates out there. Is there hope for you to find cheap insurance if you’re a young driver? Don’t despair because we have some tips for getting those premiums lower.
Why do younger drivers pay more for insurance?
Unfortunately, insurance companies see younger drivers as being reckless drivers. And there is evidence to back up this belief.
According to the National Highway Traffic Safety Administration, drivers ages 15-20 had the highest representation in speed related fatal crashes compared to other age groups.
You will notice that as you enter your 20s, you will be paying less than what you did as a teen driver. You have more driving experience under your belt, but your premiums can still be pretty pricey.
But there’s still a chance to get your premiums lower despite age being a factor. Here’s a list of things you can do to potentially get those premiums down.
1. Take a driving course
It might be a good idea to brush up on your driving skills by taking a class. Usually if you’re 21 years old and under, you can take a driver training class to get a discount on your car insurance rates. If you’re curious about this, ask an agent about it.
Another class you can take is for defensive driving. These classes teach you techniques that can prevent accidents or help you to react quickly to an oncoming hazard. Depending on the insurance company, they sometimes offer a discount on the course itself.
2. Bundle your insurance
More often than not, insurance companies will give you a discount if you purchase two or more types of insurance together.
Most people tend to go for a home and auto insurance bundle. If you’ve moved out of your parent’s house, are you renting an apartment? If you have renters insurance, consider bundling it with your auto insurance under the same company.
This can get you a discount, but that shouldn’t stop you from shopping around. There’s still a possibility that buying policies from different insurance companies can save you more money.
3. Ask about the good student discount
If you’re a full-time student with good grades, you may be eligible for a good student discount. Each insurance company has different requirements, so you should ask your insurance agent.
Don’t be discouraged if you don’t have a 4.0 GPA. Some insurance companies only require you to have a B average and above. And if you aren’t there yet, it’s something to work towards to cut your insurance costs down. You just need to submit your transcript as proof to your insurer.
4. Look into work related discounts
If you’re out of school and are working full-time, you can ask if your company participates in a group car insurance plan. Some insurance companies will give you a lower rate for drivers who get insurance through their employers.
If you are self-employed and work from home often, you’re likely using your car less. People who drive less than the average number of miles per year are eligible for the low mileage discount.
5. Maintain continuous coverage
If you’re graduating from being on your parents’ car insurance policy, make sure you let your new insurance company know. This counts as being previously insured and insurers will take this into account when calculating your premium.
Insurance companies value drivers who have continuous coverage. A lapse in coverage – even for one day – can not only result in higher premiums, but also penalties in some states.
Since car insurance is so expensive, it can be tempting to stay on your parents’ car insurance. It helps keep down costs, but there are situations where you have to switch to your own insurance.
6. Keep a clean driving record
Since you’re already paying significantly more because of your age, don’t let an accident or a speeding ticket push your premiums up.
Maintaining a clean driving record will always be beneficial to you. Later on, you can get a good driver discount that’s offered by many insurance companies.
7. Shop around
No matter what age you are, it’s always important to shop around and get multiple quotes. Each insurance company weights the things that determine your rate differently, so it’s in your best interest to shop around. This is the way to guarantee that you’re getting the best rate.
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Will I be paying those high premiums forever?
The short answer? No.
Young drivers especially in their teens pay quite a bit for car insurance. But the rate usually drops each year if you maintain a clean driving record. Another reason to celebrate each birthday.
Once you hit your twenties, around 25, everything starts to level out because that’s when insurers tend to see a drop in the number of claims submitted around that age.
Just remember that while your age can play a part in your car insurance rate, there are measures you can take to potentially get those costs lower.