Does Auto Insurance Go Down At Age 25?

Auto insurance goes down at 25, but you won't see a sudden drop in your auto insurance rate at age 25. Most drivers notice a gradual decrease in their auto insurance policy costs after 25 because older drivers are considered less of a risk than young drivers. If you've recently turned 25, start comparison shopping online to find the cheapest rates you can get now that you're older.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Written by Rachel Bodine
Insurance Feature Writer Rachel Bodine

Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years Leslie Kasperowicz

UPDATED: Jun 6, 2022

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A young drivers or teenage driver typically pays more for car insurance policy than older drivers do. A car insurance company views younger drivers as a higher risk, and they have the stats to back up this assertion.

Young drivers are involved in more accidents, drive faster, and are more reckless behind the wheel. Because of this, their car insurance cost is much higher. But how long are these high rates in effect? Do they get cheaper after age 18? Age 21? Some claim that 25 is the “magic number.”

Age Is More Than Just A Number

Most young drivers might ask “do you need insurance to drive,” “what are the states with cheapest car insurance,” or “how do you lower it.” Well, the good news is that when you reach 25, your rates will change.

You might be wondering why at age 25 your insurance rates are different than at other ages. The fact is that auto insurance premiums rise and fall as we age due to a myriad of factors.

Your age and the amount of time you’ve had your driver’s license are two of the major things auto insurers look at when determining your rates. The more experienced the driver is, the lower their car insurance rate usually is. But why is this the case?

The answer lies in the keyword – “risk.” Insurance companies are risk assessors. So, when insurance companies look at your age, they also look at their data that tells them how risky that age is, on average. Younger people are the riskiest because they lack experience and get into more accidents. Older, more mature drivers tend to be more responsible on the road.

Therefore, if you fall into one of these age groups that tend to get into lots of accidents and files lots of insurance coverage claims, you can expect to pay much more for auto insurance coverage. It’s nothing personal. Remember, to insurance companies, you are just a statistic!

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What Happens To Your Car Insurance At Age 25

The truth is that there is no magic number as to when your auto insurance rates will take a turn for the best. At age 25 your insurance rates will not suddenly drop. Most drivers, however, do start to see a gradual drop in their rates around age 25 because of the experience they built up over the years.

Many Americans start driving at age sixteen or seventeen, so by age twenty-five, they already have years of driving history under their belts. As long as you’ve maintained a good driving record and do not have a history of filing claims, you should start seeing your insurance rates get lower as you reach your mid-twenties.

How Much Can You Expect To Save?

As stated already, there is not some special discount you get when you turn 25. Your insurance rates, however, do tend to naturally get lower as you hit this age. You can expect your insurance premiums to drop by about 10% at this time.

This 10% saving rate is different for each person. As stated above, your insurance rates are determined by many different factors. Other things that could play a role in your lowered rate include: if you are married or not; if you are male or female; what your credit score looks like; if you have kids; what your driving history looks like; what your occupation is; and how many miles you drive each month. These factors all contribute to determining how much you will pay for your car insurance.

Keep in mind that if in your years as a young driver or teen driver, you kept a poor driving record with lots of car accidents, speeding tickets, and other violations, you should not expect to see a drop in rates when you turn 25.

Remember – insurance companies deal in risk assessment. Therefore, if you traded your minivan for a Lamborghini, if you just were cited for your tenth DUI, if you drove into a parked cop car, etc. Do not expect your insurance rates to go down, it just won’t happen!

How To Get Lower Rates If You Are 25

If you haven’t been in touch with your insurance agent in a while, give them a call. Once you turn 25, you should ask your insurer to take a look at your insurance rates and see if they can help you out. Ask if there are any discounts or rate reductions available to you. If you do not ask, chances are your auto insurance company will not give them to you.

If you recently turned 25 and you are not satisfied with your auto insurance rate, you can always shop around and look at different rates from different companies. Using websites like 4AutoInsuranceQuote to compare insurance quotes is a great way to find the best insurance rates for your needs.

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