Your auto insurance company may offer you a higher or lower rate based on your age group or life stage. Here are a few guidelines regarding the age-dependent differences that may affect the cost of your insurance premium.
Teenagers
Car insurance for teenage drivers is the most costly insurance available, due to the natural risks entailed by the lack of experience. In order to minimize the risk, the teenager must take and pass his driving test and be informed about road responsibilities.
At this stage in life, the driver may be struggling financially and opt for the cheapest auto insurance company in the market. In the US, students with a higher grade point average (B or above) are usually candidates for discounts. In some areas, there are discounts offered if the young driver undergoes additional training.
In the occurrence of accidents, a parent is usually available to shoulder the additional costs. Nevertheless, it is advisable for him to familiarize and research on the basic benefits and nuances of car insurance in order to make an informed choice and avoid being under-insured.
Young Adults
The insurance rate for a young adult may decrease if he has been driving for a few years with a good record. The initial rate reduction with most auto insurance companies is at the age of 21, and another reduction follows at the age of 25. If the adult has not turned 25 but is a college graduate who had formerly availed of the good student discount, he may be eligible for this to be carried over as a graduate discount.
If the currently effective auto insurance policy provides low coverage, this would be an ideal time to update. Young adults may have increased their assets, and should consider the possibility of collision, and consequent medical bills and expenses.
Adults with Families
A lower rate is usually offered if the adult is a parent or guardian, regardless of civil status, because the statistical rate for road accidents is lower when a child is present.
Upon marriage, there will be another decrease in car insurance rate, due to the presence of another adult in the car.
Adults who move to or pass through high-end neighborhoods should also consider increasing their auto insurance coverage to include potential repair costs for more expensive vehicles. However, there is also a higher risk factor, and accompanying higher insurance rate, for those who live in neighborhoods with high crime and vandalism rates.
In the event of divorce, car insurance premiums are affected depending on the change in lifestyle and division of assets. Separation of policies is usually effective 30 days after the divorce.
Seniors
Auto insurance premiums are generally higher for drivers 75 years old and above. The gradual increase in rate begins at age 55. This is due to decreased reflexes and vision, as well as other health conditions brought about by, or that worsen with, advanced age. However, there are some associations for the retired and supplemental driving classes that allow for auto insurance discounts. A good driving record in previous years will also be taken into consideration.
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