In general, auto insurance companies tend to offer lower car insurance rates once an insured driver turns 25.
Don’t expect a birthday card from your insurer and an immediate rate reduction, though. Car insurance providers don’t typically change your rates mid-policy term (unless you make changes like adding a car, driver, etc.), so you’ll have to wait until your next renewal period to see a lowering of your premium.
Below you’ll see average car insurance rates by age drop after age 25.
CarInsurance.com analyzed rates for 10 ZIP codes in each state by age for three coverage levels. Here you see average car insurance rates by age for the following coverage sets:
- State minimum: How much you need to drive a car legally in your state.
- Liability car insurance: $50,000 limit to cover bodily injury you cause to others in an accident, up to $100,000 per accident, with $50,000 to pay for damage you cause to another car or property.
- Full coverage: Liability with a $100,000 limit to cover bodily injury you cause to others in an accident, up to $300,000 per accident, with $100,000 to pay for damage you cause to another car or property, plus comprehensive and collision insurance, with a $500 deductible.
| Age | State minimum | 50/100/50 | 100/300/100 |
|---|---|---|---|
| 16 | $2,593 | $2,957 | $6,930 |
| 17 | $2,179 | $2,500 | $5,836 |
| 18 | $1,870 | $2,142 | $5,115 |
| 19 | $1,260 | $1,444 | $3,503 |
| 20 | $1,102 | $1,261 | $3,214 |
| 21 | $875 | $1,001 | $2,516 |
| 22 | $794 | $906 | $2,288 |
| 23 | $732 | $834 | $2,116 |
| 24 | $684 | $779 | $1,982 |
| 25 | $608 | $691 | $1,745 |
| 35 | $552 | $627 | $1,564 |
| 45 | $525 | $596 | $1,469 |
| 55 | $494 | $560 | $1,363 |
| 65 | $515 | $585 | $1,402 |
| 75 | $630 | $718 | $1,651 |
| 85 | $778 | $887 | $1,987 |
CarInsurance.com commissioned Quadrant Information Services to run auto insurance rates for a 2017 Honda Accord LX for 10 ZIP codes in each state using six large carriers — Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm. (In cases where one of the insurers doesn’t return a rate, another major carrier in that state is substituted.)
Why the drop in rates at 25? It’s not arbitrary; car insurance providers know that statistically, young drivers are shown in reports by organizations such as the Insurance Institute of Highway Safety (IIHS), National Highway Traffic Safety Administration (NHTSA) and Center for Disease Control and Prevention (CDC) to be more prone to accidents due to immaturity and inexperience at operating a vehicle.
Risk assessors have determined that those 25 or older are more inclined to be more responsible and that their risk of at-fault accidents has decreased. So the base rate for your car insurance policy changes at this age because you’ve matured into a better driver class; it’s not a car insurance discount for turning 25 as some believe.
Marital status, age, gender, years of driving experience and accident statistics typically are used to classify drivers. Insurance companies rating systems and factors and the state laws governing them can differ, so how much your car insurance rates will change will vary.
We have seen rates lowered as much as 20% once a driver reaches the age of 25 if that individual has kept a clean driving record and had no accidents.
While it is typically true that auto premiums will be reduced when you’ve reached your 25th birthday, if other factors about you have changed – your car, where you live, driving record, claims history, etc. – your rates could stay the same, or go up, due to these factors.
If you don’t see a noticeable drop in your rates after you’ve turned 25, ask your auto insurance provider why.
It may be that you’re with a company, such as Esurance, that instead of giving one big rate reduction at age 25, they continually lower rates every policy term as the young drivers they insure get older and have shown to be good drivers with no accident claims or traffic violations.
Even if you see a decent premium reduction, it’s still a critical time to shop around and ensure you’re getting the best rate possible. No two insurers will price a policy at identical amounts, because each uses its own formula to assess risk and calculate what you pay. You can get an idea of what you can expect to pay by reading our guide on estimating car insurance costs, which includes an average rate tool that shows rates for six age groups and three different coverage levels by ZIP code.
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Laura Longero
Executive Editor
Laura Longero is an insurance expert and Executive Editor at CarInsurance.com, where she specializes in helping consumers navigate the complexities of the financial and insurance industries. She has 15 years of experience educating people about finance and car insurance. Prior to joining CarInsurance.com, she worked as a reporter and editor at the USA Today Network. Her expertise provides readers with practical guidance, helping them make informed choices about their financial and insurance needs.
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