When do auto insurance rates go down?

Auto insurance rates go down after a year of carrying your policy. When you buy car insurance, you secure affordable car insurance quotes through several factors that determine insurance. The most significant factors to cheap auto insurance rates are age, gender, credit history, driving record, and coverage level. Car insurance rates go down when you qualify for policy and vehicle discounts. Compare multiple companies and shop around to find the best rates.

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Mar 26, 2021

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Overview

  • You won’t see a significant auto insurance decrease until you’re 25 years old.
  • Married drivers pay cheaper auto insurance rates because statistics show they take fewer risks than single drivers.
  • Speeding tickets can affect your driving record, but they go away after three years.
  • Accidents and DUIs can increase your auto insurance rates.

You’ve had your auto insurance policy for about a year, and you may have wondered, “When do auto insurance rates go down?” If you’ve had auto insurance with the same company for more than six months, you could see some savings coming your way.

Although your experience will vary based on the company you’re with and the vehicle you drive, we can give some tips on how you can secure cheap auto insurance quotes.

If you’re unsure when auto insurance rates go down, avoid expensive costs by entering your ZIP code in the FREE comparison tool above to compare cheap auto insurance companies in your area.

When do auto insurance rates go down?

Car insurance rates increase after three months of having your policy. But how come? The auto insurance company evaluates risk factors, such as your location, driving record, and credit history.

However, the conditions of cheap auto insurance rates require you to have no claims, no traffic violations, and no accidents.

Continue reading to see what factors can help you save money per month.

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What factors determine auto insurance rates?

As you’re getting a car insurance quote, you’ll be asked several questions about your details. These details are factors that will determine your auto insurance policy’s worth.

The factors that have the most influence over auto insurance rates are listed below:

  • Age
  • Gender
  • Driving Record
  • Credit History or Credit Score
  • Coverage Level
  • Commute Mileage

Your commute mileage (number of miles you travel) and coverage level won’t change like age, gender, driving record, and history.

Therefore, we’ll focus on the factors that you have a chance to change as you get older.

How do age, gender, and marital status affect your auto insurance rates?

After about a year, auto insurance rates should be cheaper. Your car insurance policy becomes more affordable with age.

Age, gender, and marital status are significant factors that determine car insurance rates. Let’s look at auto insurance costs based on age, gender, and marital status.

Average Auto Insurance Cost by Age, Gender, and Marital Status
Age, Gender, and Marital StatusAverage Monthly Auto Insurance Rates
Married 35-year-old female$204
Married 35-year-old male$204
Married 60-year-old female$187
Married 60-year-old male$192
Single 17-year-old female$630
Single 17-year-old male$752
Single 25-year-old female$225
Single 25-year-old male$241
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Young and single drivers pay the most for auto insurance. However, middle-aged and senior drivers pay much less.

Why are auto insurance rates for new drivers and teen drivers so expensive?

Auto insurance companies correlate age with driving experience. Your risk level is much lower when you have more driving experience.

According to the Center for Disease Control, motor vehicle accidents are the leading cause of teen driver deaths.

Teen drivers are more likely to be involved in a fatal accident or an accident with expensive property damage costs.

Since teens and young adult drivers have a higher chance of getting into an accident, auto insurance companies increase rates.

Comparing Auto Insurance Quotes of Drivers Aged 20 to 65

You can maximize your savings and get liability-only car insurance coverage. Liability-only auto insurance will only cover the other driver.

If you’re not at fault for an accident, the other driver’s liability policy will cover you for bodily injury and property damage.

Your liability-only car insurance policy rate will depend on your coverage limits.

What are coverage limits? Coverage limits (coverage levels) are the maximum amount a car insurance company will cover when you get into an accident. The standard minimum coverage limits are:

  • $25,000 for bodily injury per person per accident
  • $50,000 for total bodily injury per accident
  • $25,000 for property damage per accident

Let’s review the average monthly liability-only cost of drivers aged 16 to 75.

Average Liability-Only Auto Insurance Rates by Age Group
Drivers' AgesAverage Monthly Liability-Only CoverageAverage Monthly 50/100/50 Liability-Only CoverageAverage Monthly 100/300/100 Liability-Only Coverage
16$222$253$607
17$184$210$510
18$159$181$450
19$112$127$323
20$98$111$288
21$76$86$228
22$70$79$209
23$64$72$193
24$60$68$182
25$55$61$163
30$50$56$147
35$50$55$145
40$49$55$143
45$47$53$137
50$46$51$131
55$45$50$127
60$45$50$126
65$46$52$129
70$50$55$136
75$56$63$151
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Younger drivers pay more for car insurance. Also, we see how higher coverage levels increase auto insurance quotes. The higher the coverage level, the more you’ll pay for auto insurance per month.

How much is an auto insurance policy with a clean driving record?

The fastest way to get cheap car insurance is through a clean driving record before you get a policy and during your policy. You can save hundreds per year for maintaining a clean driving record.

Check out how different violations are compared to a clean driving record in the research below.

Average Monthly Auto Insurance Rates by Driving Record
Driving Record SummaryAverage Monthly Auto Insurance Rates by Driving Record
Clean Driving Record$260
With One Speeding Violation$306
With One Accident$342
With One DUI Conviction$410
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Car insurance rates determined by a clean driving record is $46 to $150 cheaper than driving records with an accident, DUI, and speeding ticket.

If you happen to have a speeding ticket within the last three years, you can quickly negate policy increases by completing a state-regulated defensive driver course.

How much is auto insurance with a good credit history?

Credit history, or credit score, changes often. Credit checks have an impact on your scores, and car insurance providers will do a soft check to see if you’re a high or low risk.

According to Experian, auto insurance companies correlate good credit with low risk. Individuals with good credit file fewer claims than those with fair and poor credit scores.

Let’s examine how credit history affects auto insurance rates.

Average Auto Insurance Rates by Credit History
Credit History SummaryAverage Monthly Auto Insurance Rates
Good Credit$264
Fair Credit$307
Poor Credit$429
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You can save approximately 5 percent on car insurance if you have good credit. However, individuals who have poor credit pay up to 20 percent more.

How much can discounts lower auto insurance quotes?

Auto insurance discounts can cut hundreds of dollars off your auto insurance policy. Check out this list of car insurance discounts that new drivers, teen drivers, and young adult drivers should take advantage of:

  • Good Student Discount
  • Distant Student Discount
  • Multi-Vehicle Discount (helpful for parents)
  • Military Discount
  • Safe Driver Discount
  • Defensive Driver Discount

Car insurance companies reward defensive and safe drivers with savings as low as 25 percent. However, your savings depend on the company.

You can receive significant savings from good grades in addition to vehicle discounts.

Discount availability depends on the company. However, you can save up to 27 percent on car insurance for being a good driver. Car insurance discounts are the best way to go when you want to reduce the impact age has on auto insurance.

Three Ways You Can Save on Auto Insurance Rates

Are there other ways you can save? Absolutely! The best savings come from discounts. Here are three ways you can secure deals from auto insurance companies.

Safety Features on Your Vehicle

When you buy auto insurance, you’ll be asked to provide your VIN (Vehicle Identification Number). The VIN will tell the car insurance company the make and model year of the vehicle.

Also, the VIN reveals the safety features and other equipment parts on the vehicle. Auto insurance providers will be able to target a rate just for your car rather than using a general rate.

Get Rid of Coverages You Don’t Need

Earlier in the guide, we mentioned liability-only auto insurance coverage as an option to get insured when you’re short on cash per month. If there are other services you use, be sure to get rid of any coverage options you don’t need.

Try Usage-Based Auto Insurance

You can get car insurance to go down if you drive less during the policy. If you don’t drive your vehicle that much, try a usage-based auto insurance program. It’s not extensive like standard car insurance, but it’s affordable if you don’t drive that often.

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Should I switch to another auto insurance company?

If you have a clean driving record, good credit, and happen to be over 24 years old, your car insurance should be cheaper than average. It should, but your auto insurance company may not decrease your rates.

With no claims before and during your policy, you should be eligible for savings. If your auto insurance quotes aren’t cheaper when you get your renewal offer, think about switching to another company.

It’s not unusual for car insurance companies to increase rates after three to six months. After one year, you should be due for more affordable auto insurance rates.

When do auto insurance rates go down?: The Bottom Line

As you get older, your car insurance rates should decrease. Marriage, homeownership, and higher deductibles can also lower auto insurance costs.

Ask questions about discounts. You may be eligible for car insurance discounts right away once you report your driver’s license, VIN, or other forms of identification.

Auto insurance rates go down after a year at best — but you should enter your ZIP code in the FREE comparison tool to compare multiple companies and shop around for cheaper auto insurance rates.

Frequently Asked Questions: When do auto insurance rates go down?

For the final section of the guide, we’ll answer some frequently asked questions.

#1 – Does car insurance go down when you turn 18?

Yes. Eighteen-year-old drivers have car insurance rates that are $500 less than 16-year-old drivers.

#2 – Does car insurance go down when you turn 21?

Once you’re out of your teen years, you pay $1,100 less for car insurance. However, that only includes liability-only coverage. Your rates will vary by company.

#3 – Does car insurance go down when you turn 25?

Yes. The most significant decrease in car insurance rates comes when you turn 25 years old.

#4 – How much does auto insurance go down after one year of no claims?

That depends on the company. If you can keep a clean driving record, you can receive 27 percent off car insurance.

#5 – At what age does auto insurance drop?

Your car insurance rates will start to drop as you get older. You won’t see significant decreases until you turn 25 years old. By 35 years old, your auto insurance goes down by hundreds of dollars.

#6 – When do car insurance rates go down for males?

As male drivers get older, their car insurance rates decrease. Therefore, male driver auto insurance goes down every year.

#7 – When do car insurance rates go down for females?

Female drivers pay much less for car insurance than male drivers. Starting at age 25, female drivers will see a significant decrease in auto insurance rates.

#8 – When does insurance go down for new drivers?

After about a year, your car insurance company may decrease your rates. Ask about auto insurance discounts to save money.

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