Car insurance rates for young drivers are typically more expensive. If you’re nearing a birthday, you may be wondering, does your car insurance go down at 25? Based on Bankrate’s study of average premiums, it might. To give you an idea of how much your premium could be, the average cost of car insurance at 25 years old is $2,176 per year for full coverage and $654 per year for minimum coverage.

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How much does car insurance go down at 25? It likely depends on personal, household and other characteristics, including your driving record and claims history. Understanding how age and other factors may affect your cost of car insurance might help you make informed decisions to get affordable rates at any age.

Does your insurance go down at 25?

When comparing the average cost of car insurance based on data from Quadrant Information Services, car insurance for a 25-year-old tends to be cheaper than for younger drivers. However, each case is personalized, so although car insurance might drop at 25 for some, that may not be the case for all 25-year-old drivers.

Average rates from the largest car insurance carriers by market share support this trend. The table below shows the average cost of a full coverage policy from these insurers for 25-year-olds, and how the rates compare to drivers aged 24 and 18.

Company Average annual 25-year-old full coverage premium % decrease from 24-year-old premiums % decrease from 18-year-old premiums
State Farm $1,637 -12% -34%
Geico $1,521 -10% -37%
Progressive $1,940 -11% -35%
Allstate $2,941 -18% -24%
Travelers $1,657 -14% -39%
Chubb $2,995 -14% -20%
USAA $1,585 -7% -23%
Farmers $1,719 -13% -33%
Nationwide $1,621 -14% -14%

*Rates reflect a 25-year-old renter on their own policy, a 24-year-old renter on their own policy and an 18-year-old on their parent’s policy.

How much do rates decrease for 25-year-olds in each state?

Based on Bankrate’s sampling of average rates across the U.S., young adult drivers with clean driving records can typically expect reductions in auto insurance costs at age 25. The amount of premium savings may vary by state and insurance company, and may depend on factors like your coverage choices, vehicle type and how much you drive.

The five states below have the greatest percentage reduction in average premiums between 24-year-old and 25-year-old drivers.

  • Montana: -22%
  • Vermont: -21%
  • Wyoming: -20%
  • Pennsylvania: -19%
  • Michigan: -19%
  • State Average annual full coverage premium for a 25-year-old Average annual full coverage premium for an 24-year-old Dollar difference
    Alabama $2,189 $2,624 -$435
    Alaska $2,143 $2,549 -$406
    Arizona $2,119 $2,494 -$375
    Arkansas $2,309 $2,560 -$251
    California $2,750 $2,948 -$198
    Colorado $2,469 $2,916 -$447
    Connecticut $1,975 $2,279 -$304
    Delaware $2,362 $2,816 -$454
    Florida $3,468 $3,915 -$447
    Georgia $2,542 $2,875 -$333
    **Hawaii $1,265 $1,265 $0
    Idaho $1,347 $1,602 -$255
    Illinois $1,941 $2,329 -$388
    Indiana $1,538 $1,830 -$292
    Iowa $1,530 $1,799 -$269
    Kansas $2,226 $2,621 -$395
    Kentucky $2,483 $2,974 -$491
    Louisiana $3,524 $4,064 -$540
    Maine $1,149 $1,384 -$235
    Maryland $2,385 $2,750 -$365
    **Massachusetts $1,480 $1,480 $0
    Michigan $2,707 $3,330 -$623
    Minnesota $2,061 $2,380 -$319
    Mississippi $2,148 $2,426 -$278
    Missouri $2,355 $2,838 -$483
    Montana $2,057 $2,638 -$581
    Nebraska $1,867 $2,229 -$362
    Nevada $2,981 $3,453 -$472
    New Hampshire $1,553 $1,823 -$270
    New Jersey $2,322 $2,694 -$372
    New Mexico $1,849 $2,112 -$263
    New York $3,509 $3,966 -$457
    North Carolina $1,471 $1,499 -$28
    North Dakota $1,483 $1,668 -$185
    Ohio $1,543 $1,792 -$249
    Oklahoma $2,313 $2,635 -$322
    Oregon $1,678 $1,932 -$254
    Pennsylvania $2,381 $2,943 -$562
    Rhode Island $2,253 $2,624 -$371
    South Carolina $1,840 $2,126 -$286
    South Dakota $1,812 $2,066 -$254
    Tennessee $1,799 $2,040 -$241
    Texas $2,270 $2,664 -$394
    Utah $1,771 $2,108 -$337
    Vermont $1,241 $1,563 -$322
    Virginia $1,756 $2,085 -$329
    Washington $1,688 $1,961 -$273
    Washington, D.C. $2,345 $2,675 -$331
    West Virginia $1,856 $2,157 -$301
    Wisconsin $1,556 $1,795 -$239
    Wyoming $1,774 $2,206 -$432

    *Rates reflect a 25-year-old renter on their own policy and a 24-year-old renter on their own policy.

    **Age is not a contributing rating factor in Hawaii and Massachusetts due to state regulations.

How gender affects car insurance rates at 25

Gender may also be considered by insurance companies when it comes to car insurance rates, although it is excluded as a rating factor in some states. Statistically, female drivers tend to be less likely to engage in risky driving behaviors compared to male drivers, including fewer DUIs and less severe accidents. This means that car insurance companies typically see female drivers as less likely to file a claim, as evidenced by the lower average premiums for 25-year-old female drivers compared to 25-year-old male drivers below:

Average annual full coverage premium
25-year-old male $2,247
25-year-old female $2,106

Ways to save on car insurance as a 25-year-old driver

While teen drivers may be able to lower their car insurance rates by staying on their parents’ policy, young adult drivers may not be able to stay on their parents’ policy if they move away from home. If you are a 25-year-old driver, talking to a licensed auto insurance agent may help you find the best car insurance for your needs, including ways to save on car insurance as a 25-year-old driver.

Discounts are a common way for drivers of any age to save on car insurance. If you have a clean driving record, you may be eligible for safe driving discounts and incentives like accident forgiveness. Purchasing a homeowners or renters insurance policy from the same company as your auto insurance carrier may also earn you a bundling discount. Each carrier may offer different discounts. Speaking with a licensed insurance agent could help you identify which discounts you may qualify for with a specific company.

Other strategies to save that may be helpful include shopping around before your policy renews and ensuring you have the right coverage types and amounts for your needs. Many insurance professionals recommend getting quotes from other carriers before your policy renews to see if another insurer may offer you a cheaper rate for your needs. This may also be a good time to make sure you’re not paying for any coverage options you don’t need. For example, if you have roadside assistance coverage but also pay for a separate towing and labor service, you may be able to remove that option from your insurance. Just make sure you review your changes with your agent first.

Why you might not save on car insurance when you turn 25

Although average car insurance premiums show that 25-year-old drivers typically receive lower car insurance rates compared to drivers ages 16 to 24, this might not always be the case. A few of the scenarios below could be attributed to why your rates haven’t decreased as expected.

  • Your state doesn’t factor age. Some states have different regulatory restrictions on what information can be used to calculate car insurance rates. Hawaii and Massachusetts are the two states that don’t allow a driver’s age to be factored in when determining their car insurance premium.
  • You have a few incidents on your driving record. Speeding tickets and at-fault accidents could both potentially result in a surcharge on your car insurance policy.
  • You received your driver’s license more recently. When you get your driver’s license may matter in how you are rated by insurers. Drivers who start driving at 16 have almost a decade’s worth of driving experience by the time they turn 25. On the other hand, a driver licensed for the first time in their early 20s has less experience driving, and subsequently could see higher rates.

Other factors that may affect your premiums

Age may be a critical factor in determining your car insurance premium, but it is only one part of the rating process. Other car insurance rating factors may also play a role in your final premium estimate, including these factors below:

All of these elements may be weighed differently by each carrier, which is why car insurance rates may vary depending on the insurance company you request a quote from.

Frequently asked questions

    • It’s possible that your car insurance premium could increase after an at-fault accident, unless you choose to pay for the damages out of pocket. As financial protection against this, some insurance carriers offer an optional accident forgiveness coverage that you may be able to add to your policy for an additional charge.
    • On average, car insurance rates tend to decrease as drivers gain more years of experience behind the wheel. Most drivers see their premiums level out at age 25. However, this is not always the case. Other car insurance rating factors that could impact the cost of your policy could include the type of vehicle you drive, your annual mileage, where you live and the costs of repair in your area. All of these factors could cause your car insurance premium to fluctuate from year to year.
    • Average car insurance rates are rising across the country, but you may still be able to be proactive to see where you could save on your car insurance policy. If you are younger than 25 and still a student, you could consider asking about what student discounts and young driver discounts are available to help lower your premium. If you are renting, you may also consider buying renters insurance from the same carrier to potentially earn a bundling discount.
    • Car insurance rates may vary considerably by age. Although the data shows average car insurance rates tend to peak around age 18, they may begin to decrease after that as you age and gain more driving experience. If you maintain a clean driving record, rates may go down with each birthday, but it is not a guarantee. With so many individualized factors that go into insurance rates, you could pay more for car insurance even as you get older, especially if you have a ticket or at-fault accident on your record.


Bankrate utilizes Quadrant Information Services to analyze 2022 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a 40-year-old male and female driver with a clean 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

To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2020 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.

Age: Rates were calculated by evaluating our base profile with the ages 18-25 (base: 40 years) applied. Depending on age, drivers may be a renter or homeowner. Age is not a contributing rating factor in Hawaii and Massachusetts due to state regulations.

Gender: The following states do not use gender as a determining factor in calculating premiums: California, Hawaii, Massachusetts, Michigan, North Carolina, Pennsylvania.