If you are approaching the age of 25, you might have heard that your car insurance rate could get better. There are a lot of factors that go into deciding your car insurance rate, and age is definitely one of them. But there is more to know than just what sort of discount you might expect when you turn 25. There are other things you want to be aware of that could help you save even more money later on. By understanding how the insurance companies set their rates, you’ll also get a more accurate prediction of what your rate might be lowered to.
Are Higher Insurance Rates Justified?
If you are younger than 25 and are paying a higher insurance rate, you might be wondering if the rate is truly justified. The fact is, countless traffic and accident statistics show that teens are much more of a danger on the road. Things that contribute to teen crashes include distracted driving, cellphone use, interacting with passengers and inexperience. Unfortunately, the numbers do prove that the insurance company is justified in raising rates for those under the age of 25 and even though you might be a great driver, the majority of teens and young adults are not.
Things That Affect Car Insurance Rates
Obviously, age is a factor that is taken into consideration when car insurance companies come up with your quote. However, it isn’t the only factor. Insurance companies also look at your gender, driving history, credit score and the region that you live in along with dozens of other variables that they use to give you a personalized car insurance quote. Don’t think that just because you are turning 25 that they will forget about the accident you had six months ago. They may decide to keep your rate where it is at until they are certain that the risk of you having another accident (and thus costing them money) is minimal.
Some of the other things that insurance companies take into account are controlled by you – in a manner of speaking. For example, the type of car that you have (the vehicle ISO rating in particular) is going to factor into the premium you pay as is your coverage and deductibles. If you have liability insurance you may not have much control over what deductibles you have but if you have gone with comprehensive coverage, you probably had the choice of deductible and many coverage options. These are going to affect your premium as well.
Talk to Your Insurance Company
The most important thing to do if you want to drop your insurance rates – on your 25th birthday or any other time – is to talk to your insurance company. Find out if they are willing to drop your premiums when you turn 25. If you haven’t had any accidents or very many tickets, there is a good chance that they will agree to give you a better rate. But don’t just rely on your age to lower your cost.
Ask your insurance company if there are other things that you can do to pay less. Some companies offer monitor devices that check your driving habits and lower your rate if you have good driving practices. Improving your credit score might be another way that you can land reduced premiums. There are lots of ways that you can get a lower rate with your insurance company if you ask.
When You Need a Change
If you can’t get the rate that you want from your insurance company, it might be time to make a change. There are good reasons to shop around for car insurance. You’ve probably heard the commercial with the tagline “when insurance companies compete, you win.” That is actual a truism within the insurance industry. When you make insurance companies compete for your money, the person that is going to benefit is you. So, shop around and look for the best rate you can find and bring your findings to the company you are with now. They might offer you a lower rate if they know that you are going to choose a different company instead.
The bottom line here is that there are definitely ways that you can get a lower premium, including reaching the age of 25. Whether or not your car insurance company is going to drop your premiums when you turn 25 will depend upon many factors, such as their own policies, your history and probably most of all, whether or not you ask for a discount. Unless they have a publicized policy in place to drop your rates at age 25, insurance companies don’t lower rates without being asked very often. Don’t be afraid to ask or shop around if you need a change.