Q

Does car insurance go down at 25?

A

Yes, the cost of car insurance usually goes down when you're 25, since you're no longer considered as risky to insure. But lower rates aren't guaranteed for all drivers.

Andrew Hurst

By 

Andrew Hurst

Andrew Hurst

Senior Editor & Licensed Auto Insurance Expert

Andrew Hurst is a senior editor and a licensed auto insurance expert at Policygenius. His work has also been featured in The New York Times, The Wall Street Journal, Forbes, USA Today, NPR, Mic, Insurance Business Magazine, ValuePenguin, and Property Casualty 360.

Updated January 31, 2022 | 6 min read

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The cost of car insurance usually gets cheaper at 25. As you gain driving experience and avoid accidents and claims, your insurance company will consider you to be less risky to insure and your rates will go down. In fact, 25-year-old drivers could pay thousands of dollars less per year for coverage than a newer, younger driver.

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However, it's not a certainty that your car insurance will go down at 25. While most drivers do pay less for car insurance once they hit 25, some people may still have high rates. You could still pay more for car insurance if you have an accident or prior claim on your record, or are a newly-licensed driver.

Key Takeaways

  • As you age and become more experienced behind the wheel, the cost of your car insurance goes down steadily before leveling off at age 25. 

  • The average cost of car insurance for most people is $4,862 per year cheaper at 25 than at 16.

  • While it's common for car insurance costs to go down as drivers approach 25, those with poor driving records or a lack of insurance history will see higher rates for their age.

Does your insurance go down at 25?

If you're like most drivers, your cost of car insurance does go down at 25. As long as you maintain a good driving record by avoiding accidents, tickets, and insurance claims, your insurance rates will likely be much lower at 25 than they were at 16, or even at 21.

Insurance companies offer lower rates to drivers who are less risky to insure. Due to their inexperience driving, teenage drivers are viewed as more risky to insure. Drivers who are 25 years old, on the other hand, typically have much more experience than a teenage driver. Because of this, their rates can be thousands of dollars cheaper.

Compared to 16-year-old drivers, Policygenius found that 25-year-old drivers pay an average of 72% less for car insurance per year. Across every state and the District of Columbia, that means insurance at 25 goes down by an average of $4,862 per year in the cost of coverage compared to a 16-year-old paying for their own policy.

State16-year-old25-year-oldCost difference
Alaska$5,128$1,553$3,575
Alabama$7,606$2,028$5,578
Arkansas$7,182$2,093$5,089
Arizona$7,158$1,838$5,320
California$5,530$2,223$3,307
Colorado$7,345$2,018$5,327
Connecticut$9,721$2,119$7,602
District of Columbia$8,021$2,098$5,923
Delaware$10,247$2,414$7,833
Florida$10,564$3,294$7,270
Georgia$7,168$2,057$5,111
Hawaii$1,472$1,200$272
Iowa$4,265$1,350$2,915
Idaho$5,241$1,346$3,895
Illinois$6,202$1,671$4,531
Indiana$4,512$1,411$3,101
Kansas$5,756$1,863$3,893
Kentucky$8,937$2,558$6,379
Louisiana$13,666$3,418$10,248
Massachusetts$6,855$1,809$5,046
Maryland$7,255$2,166$5,089
Maine$4,431$1,395$3,036
Michigan$8,300$2,873$5,427
Minnesota$4,794$1,655$3,139
Missouri$6,376$1,894$4,482
Mississippi$6,759$1,997$4,762
Montana$7,878$2,189$5,689
North Carolina$3,185$1,060$2,125
North Dakota$6,415$1,578$4,837
Nebraska$6,063$2,005$4,058
New Hampshire$5,245$1,650$3,595
New Jersey$11,148$2,588$8,560
New Mexico$5,795$1,653$4,142
Nevada$9,174$2,470$6,704
New York$6,723$2,415$4,308
Ohio$4,434$1,238$3,196
Oklahoma$7,819$2,209$5,610
Oregon$5,973$1,675$4,298
Pennsylvania$7,154$1,955$5,199
Rhode Island$10,524$2,195$8,329
South Carolina$7,031$2,201$4,830
South Dakota$5,567$1,836$3,731
Tennessee$6,178$1,563$4,615
Texas$7,371$2,199$5,172
Utah$7,789$1,729$6,060
Virginia$5,742$1,615$4,127
Vermont$4,231$1,340$2,891
Washington$6,899$1,925$4,974
Wisconsin$5,108$1,228$3,880
West Virginia$6,889$2,045$4,844
Wyoming$5,649$1,591$4,058

While the cost of car insurance tends to go down at 25, the amount that it goes down varies depending on where you live. For example, the state where the cost of insurance goes down the most for 25-year-olds is Louisiana, where a 25-year-old driver pays an average of $10,248 less per year than a teenage driver.

→ Read our picks for the best cheap car insurance for 25-year-old drivers

When does car insurance go down for male and female drivers?

The cost of car insurance for both male and female drivers goes down with every year of driving experience they gain. Male or female, as long as a 25-year-old driver remains insured and doesn't get into any accidents, receive any tickets, or make claims, they will typically pay thousands less per year for coverage than a 16-year-old.

Gender1625Difference
Male$7,207$1,983$5,224
Female$6,351$1,875$4,476

With that said, insurance companies tend to charge male drivers more than their female counterparts. In fact, we found that a 25-year-old female driver pays $108 per year less for car insurance than a male driver. However, due to the lower premiums that female teenage drivers pay, the difference between a 25- and 16-year-old female driver's policy is less than a male's for the same ages.

→ Read more about what other factors can affect what you pay for car insurance

What age does car insurance start to go down?

Although it may be difficult for teenagers to find cheap auto coverage initially, the cost of car insurance starts to go down as soon as they start to drive more. As long as they keep a clean driving record, the cost of coverage they pay should go down at the start of every new policy.

We found that the average car insurance premium drops by 27% for an 18-year-old driver compared to a 16-year-old. Afterwards, there's an ever more substantial drop when the teenage policyholder enters their 20s. At 25, insurance goes down by 29% compared to a 21-year-old before leveling off.  

While insurance goes down once you turn 25, the cost of coverage only goes down by single digits every year afterwards. In fact, in our example, from 16 to 25 the cost of insurance goes down by an average of 34%, but from 30 to 70 the typical drop is just 3%.

AgeCostDifferenceCost
16$6,779N/A$6,779
18$4,931-27%$4,931
21$2,708-45%$2,708
25$1,929-29%$1,929
30$1,705-12%$1,705
35$1,654-3%$1,654
45$1,582-4%$1,582
55$1,462-8%$1,462
60$1,449-1%$1,449
65$1,4943%$1,494
70$1,5856%$1,585

→ Learn more about how age affects what you pay for car insurance

Why is car insurance higher for a person under 25?

If you're a teenage or young adult driver, your car insurance costs will be much higher than someone who's at least 25 years old. This is because insurance companies have determined that young drivers are more likely to be involved in at least one accident and have to file an insurance claim

Young car owners are more inexperienced than a typical 25-year-old driver. They also have a reputation for high-risk behavior while behind the wheel. In fact, the Centers for Disease Control and Prevention (CDC) [1] attributes the risk that teenage drivers face on the road to several risk factors:

  • More nighttime driving

  • Less frequent use of seatbelts

  • High amounts of texting and driving

  • Common fatal accidents involving speeding

  • Great risk of drinking and driving-related fatal crashes than adults

Because older drivers are less likely than younger drivers to engage in these types of risky behaviors, the cost of insurance for most people is much lower at 25 years old compared to a typical younger driver. 

Why your auto insurance may still be expensive at 25

While for most people the cost of insurance goes down at 25, some older drivers will pay more than the average for their age. Age is a big factor in what you pay for car insurance, but it's not the only thing that insurance companies consider when setting rates. Even if you’re over 25, your insurer may still view you as a high-risk driver because of something else in your profile.

In addition to age, auto insurance companies usually consider a range of details about you in order to calculate your premiums. These vary by insurer, but might include:

  • The amount of coverage you buy: More coverage means that you'll pay a higher premium than someone with less protection.

  • Your location: Certain states, like Michigan, Louisiana, and Florida, and many major cities, are known for being the most expensive places for car insurance. 

  • Past accidents and driving violations: If you have a history of at-fault accidents, speeding tickets, or other violations, your insurance company will consider you riskier to insure than most people your age.

  • Your history of insurance coverage: New drivers without a long insurance history aren't able to show that they can avoid accidents, tickets, and late payments like drivers who have been driving for longer. 

  • Your credit-based insurance score: Insurance companies evaluate your credit to determine how likely it is that you'll file a claim. As a result, people with lower credit-based insurance scores pay more for coverage. 

Imagine two 25-year-old drivers: The first has no history of accidents or claims, lives in an area without very many other people on the road, and has good credit. She will probably pay much less than a second 25-year-old who lives in a big city and who has only been driving for a couple of years, even if they’re the exact same age.

How to lower your car insurance premiums at 25

Whether you're a driver whose premiums are still high at age 25, or someone who wants to continue saving money on car insurance, it's possible to continue lowering your premiums even after you turn 25.

One of the easiest ways to lower your premiums is by taking advantage of insurance discounts to save money. Even after you turn 25, you may be able to lower your cost of car insurance by taking a defensive driving course, electing to pay your bills electronically, or bundling more than one form of coverage with the same insurer. 

You may also be able to lower your premiums after age 25 by: 

  • Continuing to pay your car insurance premiums on time

  • Maintaining an accident-free driving record

  • Avoiding violations for speeding or drinking while driving

  • Signing up for a telematics or usage-based insurance program

  • Improving your credit score

  • Opting for a higher deductible

The best way to lower your car insurance premiums after you turn 25 is by shopping around comparing the cost of coverage from multiple companies, especially if your policy is scheduled to be renewed soon. By comparing quotes, you can shop for the lowest rate, the best coverage, discounts, the most well-regarded customer service, and more. Policygenius makes it easy to see multiple quotes at once so you can find the coverage that’s best for you at a price that fits your budget.

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Frequently Asked Questions

How many years of driving does it take before insurance rates go down?

When you first start driving, you'll likely see lower insurance costs when it's time to renew your coverage — as long as you weren't involved in any accidents or other high-risk driving behaviors. Depending on your age and other factors, like where you live, your job, your homeowner status, and more, your rates could fall more quickly than a typical new driver's would.

How often does the cost of car insurance go down?

If you’re a young driver, your car insurance is likely to go down as you gain experience. Because you lock in your rate for the term of your policy when you sign up for coverage, your insurance cost won't go down in the middle of your policy's lifetime, though. You'll have to wait until you switch insurers or renew your coverage to see a drop.

Can you lower your car insurance costs after an accident?

Yes, even though being involved in an accident causes the cost of car insurance to go up for most people, it's still possible to lower your rates or find affordable coverage afterwards. If your rates are higher because of an accident, you could lower your premium with discounts, especially a defensive driver course. You should also compare coverage, since some insurers specialize in covering higher-risk drivers. Or you could wait for your rates to fall; usually it takes three to five years of clean driving for your premiums to return to normal.

Methodology

Policygenius analyzed car insurance rates provided by Quadrant Information Services for every ZIP code in all 50 states plus Washington, D.C. to get the data used on this page. For full coverage policies, the following coverage limits were used:

  • Bodily injury liability: 50/100

  • Property damage liability: $50,000

  • Uninsured/underinsured motorist: 50/100

  • Comprehensive: $500 deductible

  • Collision: $500 deductible

In some cases, additional coverages were added where required by state or insurer.

Rates for overall average rate, rates by ZIP code, and cheapest companies determined using averages for single drivers ages 30, 35, and 45. Our sample vehicle was a 2017 Toyota Camry LE driven 10,000 miles/year.

Rates for driving violations and "Poor" credit determined using average rates for a single male 30-year-old driver with a credit score under 578.

Some carriers may be represented by affiliates or subsidiaries. Rates provided are a sample of costs. Your actual quotes may differ.