Shoeaholic No More



March 2016



Being an Adult Rules! Average Car Insurance Rates by Age

Written by , Posted in Money & Finances

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Our efforts are evaluated by the work we produce. And our insurance rates? Our insurance rates are evaluated by the combination of, well, a whole bunch of things. Insurance companies calculate the monthly expense that is our premium using data pulled from studies rating us by our age, gender and career, among others. These comparisons between public and private factors help insurance providers to gauge our driving risk factor. As the insurance world continues to become more driven by big data and analytics, our own driving records serve as beacons: helping us to earn discounts and better insurance prices.

But when we’re first starting out as brand new motorists, it’s the data only that speaks to the insurance agencies. While it may seem unfair that average car insurance rates by age dictate our insurance premium costs, statistically speaking, younger drivers are involved in more serious accidents. But don’t fret, there are always ways to reduce our insurance premiums.

Teens and Their Driving Skill Set

As a newly licensed driver, there is the expectation that with time you will become a responsible motorist on the road. This means obeying traffic laws and keeping your eyes on the road.

According to the statistics, teen drivers are most at-risk. DoSomething found that 16-year-old drivers have the highest crash rates than motorists of any other age. It has been argued that the higher crash rates are the result of distracted driving. Texting and socializing with passengers increases the likelihood of an accident (not to mention that texting and driving is illegal). AAA found that cell phone use attributed to 12 percent of crashes, while socializing, singing, and dancing to music contributed to 23 percent. For many teenagers, getting a license means freedom. Unfortunately for some, this freedom comes at a high price.

This isn’t to say that all young people are reckless and could be a liability on the road. The point is that statistically, teenagers are more likely to be involved in serious and fatal accidents. Due to this, insurance companies set the monthly premium rate at a higher cost. Though the cost may be higher, it’s to protect our teen drivers, not to hurt them.

Hitting Your Prime

As you approach your thirties and beyond you’ll begin to save on your insurance premiums. Rates will drop down simply because you have proven for a decade or even longer that you are a capable and responsible driver—just as long as you have a driving record to reflect that.

By the time you have reached adulthood, you will most likely own your own car, maintain your bills and have an established credit history. All of this contributes to your insurance premium breaks.

There’s Another Way

The last thing you want to do is overpay for your rates. One way to avoid this is to shop around. The insurance game is a competitive one, and reputable firms do their very best to offer clients and new customers a car insurance plan that is as reliable as it is cost-effective. Car insurance protects you in times of vehicle-related trouble, so it’s important to have a plan that will protect you when you are facing your driving worst-case scenario. No one ever plans to get in accident, but as we all know, accidents are just another part of life.

Fortunately, we have insurance to soften the blow. Whether you’re still driving or transitioning into the passenger seat as your teen gets behind the wheel, you want to make sure your insurance will be there when you need it. In some cases, this will result in a premium hike, but when it’s all said and done, the hike is well worth it. Especially after Junior has backed into your mailbox.

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Kayla is a mid-20s single girl living in the Midwest, USA. She is focused on paying off her consumer and student loans, while simplifying her life and closet. You can join her on her journey at ShoeaholicNoMore or follow her on Twitter.

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