The average price of car insurance changes depending on how old you are. For example, young drivers without a lot of experience behind the wheel are going to pay more. Insurers use information about average statistics for age groups to help determine rates.
If you’re a 25-year-old insurance seeker, knowing what factors influence your rate and about how much you can expect to pay on average can help you as you compare providers.
How much is car insurance for a 25 year old?
As you probably know, the cost of car insurance varies on a lot of factors for each individual (driving history, credit score, location, type of car, etc.). The average car insurance for 25 year olds is $1,989 a year, which is significantly more than the overall U.S. average.
Average cost of males vs females
If gender is taken into consideration, there is a cost discrepancy between males and females. However, the cost difference isn’t significant at 25.
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Cheapest car insurance companies for 25 year olds
The cheapest car insurance companies for 25 year olds are well reviewed, nationally renowned companies. You should be able to find both low rates and high customer service scores from these providers.
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Travelers insurance offers the lowest rates on average for 25 year olds and some of the most discounts too. You can get your standard array of discounts with Travelers, but you can also find a few unique ones, too. For example, if you want to prove you’re not the typical 25 year old driver, you can sign up for Travelers IntelliDrive program. With IntelliDrive, you install a smartphone app that monitors your driving habits each time you get in the car. If Travelers likes what it sees, you may receive a discount up to 20% on your premium.
Erie is one of the highest, if not the highest, ranking companies with J.D. Power & Associates (an independent third party company that studies customer satisfaction) every year. You want your insurance provider to score well with J.D. Power because it strongly suggests that you’ll have a good experience any time you need to file a claim.
Erie’s Rate Lock program lets your premium stays the same year after year even if you file a claim. As long as you keep everything about your policy the same (address, drivers, coverage amount), your rate will stay the same.
Amica offers a lot of ways its customers can save on their premium. Not only does it offer a lot of discounts, but the discounts it offers provide significant savings. For example: insuring two or more cars with Amica may give you a discount of up to 25%, and combining auto insurance with another policy (such as homeowners or renters) could save you up to 30%. Amica also scores extremely well with companies like J.D. Power. In 2020, Amica ranked as the #1 provider for New England.
USAA only services former and current military, as well as their immediate family members. If this describes you, you want to ask USAA for a quote at the least. If it weren’t for its exclusivity, USAA would score as the top provider for the whole of the United States with J.D. Power.
It doesn’t offer many unique discounts, but the ones it does offer are some of the most commonly used ones and the rates are often the least expensive anyway. That said, it does have a couple that are geared towards men and women in service. For example, you can save up to 60% on your premium whenever your car is garaged for extended periods of time while you’re deployed.
For the Mid-Atlantic region, State Farm scored as the top provider in customer satisfaction with J. D. Power in 2020. This isn’t all too surprising because it provides a variety of discounts to help its customers save, and also has a top notch smartphone app (which you can use to pay your premium, file a claim, or request roadside service). No, it’s not the cheapest provider on our list, but with discounts such as Defensive Driving giving you 15% savings it could very easily snatch the #1 slot from Travelers.
How to save on car insurance for 25 year olds
To get the best 25 year old insurance options, there are four things you can do.
Each company analyzes your personal information, but each company has its pricing algorithm. Therefore, one company may consider something such as your credit score important, another company may not put as much stock in it. This is why it’s easy to receive very different quotes from two very similar companies. Always shop around to get the best quotes!
It’s important for an insurance provider to have a fair amount of auto discounts, but it’s more important for those discounts to actually be applicable to you as a driver. Look for discounts that you can immediately apply to your premium and ones that you can work towards. You may need to speak with an agent to see how much you’ll actually save if it’s not advertised on the company’s website.
Raise your deductible
Raising your deductible will lower your premium, but at a cost. Should you get into an accident, you’ll receive less of a payout from your provider. So while this may save you money month to month, you’ll want to have some money put aside in savings just in case.
Drive an older car
New cars cost more to replace, so to lower your premium it’s always a good idea to drive an older car with a high safety rating.
Improve your credit score
One factor that car insurance companies use to determine the cost of your premium is your credit score. If you improve it, your premium will lower. This is obviously a long term game plan, so make sure you speak with an insurance agent about what score you would need in order to get a lower rate, as well as any additional steps you might need to take.
How to get the best insurance for a 25 year old
Finding the cheapest car insurance will take a little bit of legwork, but the process is pretty straightforward.
- Shop around and ask for quotes
- Compare discounts
- Compare premiums and deductibles
- Notify agent of chosen company that you would like a policy or submit authorization online
As you can see, it’s fast and easy. The longest step is the first one where you are submitting personal information and waiting to hear back. That said, it shouldn’t take any longer than an evening or two, depending on how thorough you are shopping around.
Frequently asked questions
What is the best car insurance company?
There are a lot of ways to answer this question depending on your criteria. For an in-depth dive, visit our Best Car Insurance Companies page.
Is basic liability enough?
It’s often not, especially if you don’t live in a no-fault state. For example, if you just consider the property damage limits (usually $25,000), many states don’t mandate that basic liability even be enough to cover the costs of a new car (often $35,000 to $50,000). Any amount that exceeds your property coverage limits must be paid by you out of pocket.
At what age does car insurance go down?
There isn’t a magic number that car insurance companies go by, but the age that many drivers tend to see their car insurance begin to go down year after year is 25.
Bankrate utilizes Quadrant Information Services to analyze rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 25-year-old male and female driver with a cleaning driving record, good credit and the following full coverage limits:
- $100,000 bodily injury liability per person
- $300,000 bodily injury liability per accident
- $50,000 property damage liability per accident
- $100,000 uninsured motorist bodily injury per person
- $300,000 uninsured motorist bodily injury per accident
- $500 collision deductible
- $500 comprehensive deductible