How to save money on car insurance under age 25?

I have a perfectly clean driving record, but I still have to pay ridiculous prices for car insurance because I am only 21. I keep hearing that my rates will go down if I keep my record clean long enough. Whoever started that lie needs to be beaten. It’s been four years since I got my license and they haven’t dropped a cent. Is there anything I can do?

Also, another major lie I have been told is that safety features reduce your rates. I am currently driving an old Saturn, and will be buying a new car soon. Every car I have looked at, I got an insurance quote for. Despite having significantly more safety features, they all cost much more to insure.

A new car is worth more - so your collision insurance will make your total cost go up. With an old junker it probably doesn’t even pay to carry collision. You’ll need to look at the breakdowns of specific coverage options to see the benefits. Any discount for safety features will likely going to show up in your medical coverage for you and your passengers.

Your rates will go down when you hit 25 (or there abouts) based on actuarial tables. Clean records help, but only to a point. Age (and marriage) are the biggest factors, or so I’ve been told.

When I was under 25, long years ago, I took a defensive driving course (for my job) which lowered my rates somewhat. I was female though so my rates weren’t all that high to begin with. Much more recently, one of my sons took a defensive driving course through AAA and I think it lowered the rates (which weren’t all that high because at that time he didn’t have his own car).

And there are insurance companies who claim to give lower rates if you have a clear record. You’d have to ask around. Just note that most things in life are negotiable. If you go to an agent and say, “This costs too much,” there are some that might work with you and tell you ways to make it lower.

Wait.

:stuck_out_tongue:

How to lower insurance rates.

  1. Buy an old beater. Something in the 1000 dollar range.
  2. Carry only public liability insurance on it. (no collision, comprehensive coverage)

It won’t get any cheaper than that unless it has 3 or less wheels.

I don’t think insurance rates ever go down. I think they just don’t go up as much as they could.

Have you shopped around since you turned 21? With the old rating methods insurance companies used 20 years ago, prices typically dropped a lot when a male turned 21 and some more at 25, and again at 30, but it didn’t happen until your policy renewed after your birthday. They didn’t say, “boffking just had a birthday. Rerate his policy.” So get some quotes as a 21 year-old. With the multivariate rating method companies use nowadays, the change might not be as dramatic as it used to be. I’m not sure if all companies have switched to multivariate or not. The two companies I’ve worked for recently use multivariate rating.

Mine went down substantially after 25. At 33, I’m paying less than my mother was to have me on her policy as an additional driver.

Get an old slow safe car like a Volvo.

  1. Shop rates. Insurance BROKERS have access to multiple companies and can give you multiple quotes to pick from. Some of the larger companies do business only through their own “captive” agents. The broker can’t quote them, so you need to talk to them. Neither is really a better choice than the other, you just need to know they have limits on what they can quote you.

  2. Wait. Do young guy stuff and enjoy being a young guy. Accept the fact that young guys tend to cause trouble with the car and y’all are making it tough on each other. Bitch about your insurance rates. When you’re an older guy (25-30+) you can bitch about being older, but revel in the fact you’re not having to pay for the damage those young guys get up to.

  3. Whatever you do, do business with a human who will explain to you what you are paying for, and what that means in practical terms:
    3.a) A $1,000 deductible for collision damage will cost you a lot less than a $250. So big deductible saves you money, right? Right. But if/when you need to make that claim, will you be able to come up with that money right now? If not, you’ve got a wrecked car until you can.
    3.b) Minimum liability limits (25/50 in most places) is cheaper than higher limits (i.e. 100/300). One school of thought says, “you can’t get blood from a stone, so if you’ve got no assets or income worth garnishing, go low and save money. Folks you hurt will just have to accept the $25k limit” What nobody mentions is, in most states you can’t buy un(der)insured motorist coverage that is better than your liability coverage. Meaning, if you only want to be able to pay a maximum of $25k for injuries you cause to someone else, you can’t buy better than that to cover yourself when someone else cheaps on HIS insurance. I carry 1.25 million in liability coverage ONLY because that gives me the right to insure myself for that kind of damage if someone else is at fault and underinsured.

  4. Seriously, talk to a person about all this. It’s expensive, and most folks only think about car insurance because they want to drive legally. What they often fail to think about is how the stuff actually works. Knowledge won’t make it any cheaper for you to get insurance, but you might feel a little better about it if you really understand what you’re shelling out the clams for.

Yeah, a new car will always cost more than an old car unless you plan to not carry collision insurance on your new car (not possible if you’re financing the purchase, mind you).

If you rent and therefore need renter’s insurance, get both the car and renter’s insurance from the same company for a laughably small kickback rate that you’ll snatch up anyway because money is money. Or if you own a house, same thing for home insurance. But I figure at your age you likely don’t own.

My state allows me to take an online defensive driver course for 10% off my insurance rates. It cost $25 going in but saved me much more going out, and is good for three years. I did finally see the magical “5 year good driver discount” on my rates this year after my one speeding ticket finally got old enough, so it does happen. I did notice that my rates dropped by a little every 6 months rather than any big drops (outside of that 5 year good driver one) so they may be doing the same slow decline with you as well.

Not necessarily. I was insuring a (paid off) 2008 Hyundai Elantra for $326/6 mos. with Progressive. I bought a 2014 VW GTI and my rate went down to $314 even though I financed it.

Liability insurance probably won’t vary at all by the type of vehicle. Any car is heavy and fast enough to do plenty of damage.

Collision is going to vary with the cost of the vehicle.

Comprehensive is going to vary with the cost of the vehicle, but might be lower for newer cars if, for example, they have more effective anti-theft technology.

Are you sure that you had the same levels of coverage and deductibles on both of those cars? Which premium went down?

It would have cost me less to pay for my mom’s insurance AND mine by adding me to her plan than to cover just myself with a separate policy. We added me to her plan as an additional driver until I moved out of state for grad school.

Marry a woman with a stellar driving record and combine policies.

Don’t you all get a no claims discount? Ours is 10% per year up to a maximum of 5 years (50%)

On top of that there is a 5% “no tickets” bonus that you can get if you are ticket free for I think 5 years.

I used to be able to buy two different types of policy* - “agreed value” and “market value” - this could represent a small savings if you insured you car for “own damage” for a lesser amount.

The other way is to check what sort of insurance - i.e, who is an authorised driver… There is one company here that offers different rates depending upon some variables
a) “own workshop” or insurance company nominated workshop
b) Authorised driver (i.e - only named drivers are covered vs any driver you give permission to drive the car)
c) Type of use - they have different rates depending upon how you use the car (less than XX km per year is one rate, drive car weekends only is a different rate, drive to work is a different rate again, drive FOR work is another higher rate)

In short - be clear on what you are buying, and see if the insurance can be tailored to your usage pattern to save money.

  • liability insurance of course never changes

Don’t you all get a no claims discount? Ours is 10% per year up to a maximum of 5 years (50%)

On top of that there is a 5% “no tickets” bonus that you can get if you are ticket free for I think 5 years.

I used to be able to buy two different types of policy* - “agreed value” and “market value” - this could represent a small savings if you insured you car for “own damage” for a lesser amount.

The other way is to check what sort of insurance - i.e, who is an authorised driver… There is one company here that offers different rates depending upon some variables
a) “own workshop” or insurance company nominated workshop
b) Authorised driver (i.e - only named drivers are covered vs any driver you give permission to drive the car)
c) Type of use - they have different rates depending upon how you use the car (less than XX km per year is one rate, drive car weekends only is a different rate, drive to work is a different rate again, drive FOR work is another higher rate)

In short - be clear on what you are buying, and see if the insurance can be tailored to your usage pattern to save money.

  • liability insurance of course never changes

Do what just about every young guy I knew did:

**Find a girlfriend and put the car in her name. ** :smiley:

Many, many, many years ago I ran the high risk quotes in the brokerage office of a major insurance company. We quoted the high risk clients through Progressive and noticed that the rates could vary substantially based on make and model of vehicle. Generally stereotypical Soccer Mom-mobiles got lower rates. Anything remotely sporty got higher rates, sometimes MUCH higher.