How car insurance premium varies with age?

Further reading

Do auto insurance rates increase with age?

A lot of drivers are (understandably so) under the impression that older drivers are paying a lot more for automobile insurance than younger drivers, especially those that reach a certain age and begin to deal with things like impaired vision, impaired motor skills, and impaired reaction abilities.

Most folks on the impression that these impairments would lead to more accidents and incidents out on the road, and as a general rule there definitely is some legitimacy to this concern.

However, according to automobile insurance companies like Florida Insurance Now, older generations aren’t paying much more than younger generations – if they are paying anymore to begin with – and it’s actually younger people that are paying quite a bit more for insurance and will be able to pay less as they get older.

Older drivers have opportunities to use their driving record to save money

As we highlighted above, senior drivers definitely have higher rates of car accidents and moving violations than middle-aged drivers, but they are often able to pay a lot less for their insurance because of the decades of clean driving records they’ve been able to build in the past.

On top of that, a lot of automobile insurance companies offer significant discounts for drivers between the age of 55 and 70. The research shows that between these ages drivers are particularly careful, and that it isn’t until they reach the age of 70 that they statistically begin to deal with increased traffic incidents.

Young people are the most at risk drivers on the road today

The same statistics compiled by the automobile industry that helps older drivers save so much money show that younger drivers – inexperienced drivers between the age of 16 and 24 – are the most likely to end up in moving violations, get speeding tickets, and deal with automobile accidents.

These drivers are the least experienced drivers on the road, the most easily distracted drivers statistically, and just don’t have the driving training or knowledge base to pull from when they find themselves in adverse conditions – particularly inclement weather like heavy rains or snowstorms up north.

Auto insurance for the first eight years or so of a young person’s driving record is going to be very (VERY) expensive compared to the insurance that they’ll pay for the next 30 or 40 years – or longer – and there’s certainly no real truth to the fact that auto insurance gets more expensive the older you get until you reach very advanced ages.

How much would auto insurance be for an 18-year-old?

According to information released by the insurance industry in 2017, the average female 18-year-old driver in the state of Florida is going to pay about $4674 per year in automobile insurance.

Things look even worse for your average 18-year-old male driver in the state of Florida, as they have to pony up $6036 a year for identical automobile insurance coverage. Both of these figures are quite a bit higher than the US average, where in 18-year-old driver (of either sex) will end up having to pay about $4055 per year for automobile insurance.

Obviously, these figures assume that the 18-year-old is going to be purchasing insurance from a legitimate insurance company like Florida Insurance Now, paying for their own insurance policy and not going under their parent’s insurance policy, and taking advantage of a policy that offers 100/300/100 coverage (as is the industry norm).

The 100/300/100 policy includes:

  • $100,000 for injury liability for a single individual
  • $300,000 for all injuries that occur in a single accident and
  • $100,000 worth of coverage for all property damage in that single accident

It also assumes that the 18-year-old is purchasing a vehicle that carries a loan, compelling them to carry comprehensive and collision coverage that they may not have carried otherwise. 18-year-old drivers can reduce their insurance liability considerably by purchasing a vehicle for cash out of pocket and carrying the minimum level of coverage, sometimes reducing their total insurance expenditure by nearly 50% along the way!

Obviously, if you – or your child – is 18 years old, the best way to save quite a bit of money on insurance is to purchase that vehicle with cash out right but also to put them under the insurance coverage of their own parents.

Coverage is almost always quite a bit cheaper (often times 75% cheaper than purchasing it out right) and this process allows these 18-year-olds to gain “credit” for carrying automobile insurance without having to pay skyhigh premiums because of their age or their sex.

Young drivers are ALWAYS penalized simply because they are young drivers, inexperienced, and the most likely (statistically) to have to take advantage of insurance coverage because of the way that they drive. This kind of insurance premium is going to be paid out on drivers until they reach the age of 21 if they are female and until they reach the age of 25 if they are male, simply because of the risk factors that the insurance companies use to determine when young drivers become more mature drivers.

Should Car Insurance Decrease at 25?

In most states, especially Florida, motorists with decent driving records can enjoy policy discounts once they reach 25 years of age. While some of the younger drivers (and even some of the older ones) disagree with this, there are plenty of good reasons for it. Although age is not always an indication of better driving habits, more experienced and responsible motorists do deserve a break.

What Happens to a Driver at Age 25?

In the state of Florida, most people begin driving with supervision around the age of 15 or 16. By the time someone reaches the age of 25, they have been operating a motor vehicle by themselves or with another person for nearly 10 years. Many insurance providers believe that this extensive experience is indicative of the driver’s improved comfort and expertise on the roadways. Albeit not accurate in all cases, it is a terrific guideline which ultimately helps policy holders save a little money on their auto insurance coverage.

What Factors Are Considered?

Aside from a person’s age, many auto insurance underwriters consider several other factors to determine the policy holder’s eligibility for a reduced premium. Although a driver may be qualified for a price reduction at the age of 25, other aspects may still keep them from enjoying those savings.

Those factors often include, but are not limited to, the following:

  • The policy holder’s driving history
  • The policy holder’s vehicle type
  • The state in which the policy is rendered
  • Other people listed on the policy
  • The driving record, age, and vehicle type used by the other people listed on the policy
  • Any existing discounts already applied to the current policy
  • The marital status of the policy holder/holders
  • The general health and/or any impairments of the policy holder

In addition, some auto insurance providers may consider other factors as well when determining a 25-year old’s qualifications for an age-substantiated discount. Speak directly to a licensed agent for more information. In general, however, most people who have an active policy at the age of 25 wind up paying a little less than their younger counterparts.

Florida Insurance Now matches the driver with his or her most affordable policy premium, typically based on their age, relative driving record, policy history, and other pertinent information. Unfortunately, there is not a one-size-fits-all cost for auto insurance and a quote is often needed for a more accurate estimate on the price of coverage.

Are Auto Insurance Rates Higher For Seniors?

When it comes to common Florida auto insurance questions, issues concerning senior drivers is pretty high on the list of concerns we hear about at Florida Insurance Now. Given the high number of seniors who live in the state of Florida, this certainly makes sense. Auto insurance rates for seniors is something that frequently comes up. On this subject, there are a lot of myths that should be disregarded.

It makes sense to assume that car insurance rates are going to be higher for seniors. As we get older, things like our vision, our coordination, and other aspects of our general health decline. This leads one to suspect that as these things deteriorate, the potential for accidents increase. Car insurance companies are all about risk assessment, when it comes to giving you a quote. If you’re older, and your vision is bad, or if you have arthritis in your hands, it makes sense to assume that your insurance rates are going to be higher than someone who is younger.

While this makes sense on paper, this is not always the case. When it comes to the issue of auto insurance rates for seniors, there are several things you need to understand.

Auto Insurance Rates And Seniors

Yes, it is true that due to the challenges of aging, seniors have a higher rate of crashes than younger drivers. However, there are a number of different things that senior drivers can do, in order to ensure their rates are on par with their younger counterparts. If you are between the ages of 55 and 70, most insurance companies will emphasize your experience as a driver, over the potential consequences of aging, as they relate to your ability as a driver. It isn’t until a driver goes beyond the age of 70 that they should begin to see some increases in their rates.

However, even for drivers aged 70 or older, there are several things you can do, in order to maintain good rates. Choosing a car with a high safety rating can accomplish a lot, in terms of lowering potential insurance rates. Driving less is another thing that older motorists can do. Finally, raising deductibles can prove to be extremely useful. Paying a high deductible out of pocket can be a little challenging, particularly on a fixed income. However, if you can manage such a thing, the long-term savings can prove to be extremely beneficial.