In general, auto insurance companies tend to offer lower car insurance rates once an insured driver hasturned the age of 25.

Don’t expect a birthday card from your insurer and immediate reduction in your rates though. Car insurance providers don’t typically change your rates mid-policy term (unless you make changes like add 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. analyzed rates for 10 ZIP codes in each state for by age for three coverage levels. Here you see average car insurance rates by age for the following coverage sets:

  • State minimum — what 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

*Methodology: 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 of 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 normally are used to classify drivers. Insurance companies rating systems and factors can differ, as well as the state laws governing them, so how much your car insurance rates will change will differ.

We have seen rates lowered as much as 20 percent 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 lowers 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 do see a decent premium reduction, it’s still a critical time to shop around and make sure 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 how to estimate 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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Michelle Megna
Contributing Researcher

Michelle is a writer, editor and expert on car insurance and personal finance. She's a former editorial director. Prior to joining, she reported and edited articles on technology, lifestyle, education and government for magazines, websites and major newspapers, including the New York Daily News.