Auto insurance rates through the ages

Gina Roberts-Grey
Your auto insurance rates can fluctuate from one decade of your life to the next. And depending on what decade that is, the number of candles atop your birthday cake could send your rates up or down.
“Age is one of the many factors used to set car insurance rates,” says Sierra Knight, owner of KMI Insurance Solutions LLC, an independent insurance agency in Virginia.
Other factors may include your credit history, marital status, gender and driving record. Keep in mind that several states, such as California, do not allow your credit history to be used in calculating your auto insurance rates.
Jack Taylor, professor of insurance at Birmingham Southern College in Alabama, says age plays a role in setting auto insurance rates because insurers correlate age with risk.
“Premiums are based on risk, whether it is the risk of an accident or the likelihood of premature death … . The younger you are, the less experience you have behind the wheel,” meaning higher risk and higher rates, he says.
Knight says: "Age plays a role because statistics have shown that certain age brackets like those under 25 and drivers over 79 are more likely to have a claim.”
It varies by company, but there's a point somewhere after your 30th birthday where premiums will start declining – assuming you've got a clean driving record, Taylor says. “There also may be a curve for older drivers where rates will start to climb again,” he says.
To illustrate how age affects auto insurance rates, Billy Van Jura, an independent insurance broker in New York, provided a fictitious driver in his state -- someone who has a clean driving history and a credit score of 730, is married and drives a 2012 Toyota Camry. Here's how that driver would be charged for auto insurance at various stages in life.

    Male                                      Female

Age 20                        $1,959                                     $1,886

Age 30                        $1,296                                     $1,297

Age 40                        $1,225                                     $1,266

Age 50                        $1,158                                     $1,170

Age 60                        $1,111                                     $1,090

Age 70                        $1,137                                     $1,167

Age 80                        $1,506                                     $1,508

Age 90                        $1,843                                     $1,654

Knight suggests the following tips to reduce the cost of your car insurance premiums, for all ages:
1. Pare your coverage. Consider carrying only liability coverage, which pays for damage and injuries to other motorists, cars and objects -- not for damage to or theft of your own car. Liability coverage is required in every state except New Hampshire; lenders typically require comprehensive and collision coverage if you've financed your car. Comprehensive coverage applies to losses caused by something other than a wreck, such as fire, theft and storms. Collision coverage applies to losses caused in a crash.
2. Consider a higher deductible. Ask your agent or insurer how raising your deductible would affect rates. For instance, inquire about the difference in premiums for carrying a $1,000 deductible rather than a $500 deductible.
3. Report the grades. If you’re a student or the parent of a young driver who's enrolled in school, you can show proof of an A or B average to qualify for a good student discount.
4. Tell your agent whether you recently earned a college degree. Most insurers offer a discount for drivers who hold college degrees.
5. Bundle your policies. You can save money by insuring your car as well as your home or apartment with the same insurer like Allstate, Progressive and many others.
6. Seek a paperless discount. Switching to receiving bills online or by email rather than by traditional mail may result in a lower premium.
7. Ask for age-related discounts. Many insurers will extend a "mature driver" discount to policyholders in their 60s and 70s. The discount varies greatly based on the driver’s actual age, history, state and insurer. To qualify, you may need to take a state-approved safety course.

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