When Does Car Insurance Go Down? (2023)

• Car insurance goes down in cost as teen drivers get older, eventually leveling off between the age groups of 35 and 55.
• When a speeding ticket, accident or other traffic violation falls off your record, car insurance premiums will decrease.
• If your situation changes, you may be eligible for additional insurance discounts from your current provider or a new provider.

Car insurance premiums can seem like a mystery. Rates seem to rise all the time, so when does car insurance go down? Fortunately, insurance costs can decrease in a variety of situations. However, you may find the best car insurance rates by switching providers instead of waiting for your rates to go down. Let’s take a closer look at when car insurance rates go down.

If you’re below the age of 25, rest assured that your car insurance rates will probably go down as you age into your 30s. You get more driving experience as you age. Younger drivers are more likely to get into car accidents and commit traffic violations than older drivers, so they pay higher rates.

Car insurance is most expensive for teen drivers and then decreases as they get older. Rates level off between the age groups of 35 and 55, then rise slightly as senior drivers are seen as a bit riskier to insure.

Car Insurance Rates by Age

Below, you can see how average rates change by a driver’s age. These rates apply to individual car insurance policies, not teens on family policies. Car insurance is very expensive for teens on their own policies, so it usually makes more sense to add them to a family policy to avoid higher premiums.

The average rates above are for full-coverage insurance with liability car insurance limits of 50/100/50. This breaks down to the following:

• Bodily injury (BI) liability coverage: $50,000 per person
• BI liability coverage overall: $100,000 per incident
• Property damage (PD) coverage: $50,000 per incident for the damage you do to others’ property

Rate averages also include collision insurance and comprehensive insurance with a deductible of $500.

Most driving infractions and at-fault accidents will fall off your insurance record after three years. If you’ve been a good driver for the last few years, you may notice your rate decreasing.

However, this timeline depends on the type of infraction and your state’s laws. Some states allow car insurance companies to consider only three years of driving history, while other states allow companies to consider up to 10 years. This means serious violations like a driving under the influence (DUI) conviction can affect your rate for longer than three years depending on your state.

Rate Decrease After a Speeding Ticket Falls Off Your Record

Our rate averages show 35-year-old male drivers pay about $2,313 per year with a speeding ticket and $1,816 per year with a clean driving record. Here’s a breakdown of average costs by company.

Rate Decrease After an At-Fault Accident Falls Off Your Record

On average, our rate data shows male drivers pay about $2,689 per year with an at-fault accident on their records.

Rate Decrease After a DUI Falls Off Your Record

A DUI can significantly increase your rates for three or more years depending on your state. Male drivers with DUIs pay about $3,277 per year according to our rate averages.

Another way your auto insurance policy costs can go down is by changing companies. No matter your driving history or situation, you’ll find different rates from different providers. There’s a good chance you could find better cheap car insurance just by switching providers.

Average Car Insurance Rates by Provider

Above, you can see how average car insurance policy rates vary depending on the company. These rates apply to 35-year-old drivers with good driving records. You may find the cheapest car insurance from a different provider depending on your situation. In other words, the cheapest company for students might not be the cheapest for veterans.

Look for the following car insurance discounts to find the best companies for your situation:

• Safe driver discount
• Good student discount
• Military discount
• New car discount
• Defensive driving course discount
• Teen driver discount
• New driver discount
• Bundling discount

Car insurance rates can fluctuate based on many more factors. Most of these are completely out of your control and also unpredictable. But it’s good to know what else affects the cost of car insurance.

Loyalty Discounts

Many car insurance companies offer loyalty discounts for customers who stick around. You may have to wait a few years to get one of these discounts, or your company may not offer one at all.

Changes in Your Situation

If you have a teen on your family policy, you can expect your car insurance to decrease as they age into their 20s. Your rate could also go down if a driver moves out of your household.

Most states allow companies to consider credit scores when setting auto insurance premiums. People with poor credit histories pay more, and people with excellent scores pay less. If you’ve been working on your credit, you could find cheaper annual premiums as your score improves.

Also, if you finish paying off your car loan, you aren’t required to have full-coverage insurance. You’d want to have it if your car is a newer model, but you might not need it if your car is older and you can afford to fix it out of pocket. Switching to minimum-liability coverage would make your car insurance go down.

State Insurance Requirements

Almost all states require minimum levels of car insurance. Sometimes, these minimum levels change. If a state lowers its minimum car insurance requirements, that could lower the cost of minimum coverage in that state.

State Regulations

States enact regulations for how car insurance companies can set their rates. According to the Insurance Information Institute, car insurance rates must:

• Be adequate to maintain company operations
• Not be excessive and lead to exorbitant profits
• Not be unfairly discriminatory

State governments may require car insurance companies to change their rates based on the factors above.

Total Claims in Your Area

Auto claims in a geographic area affect what people pay in that location, even if they didn’t file a claim. A year of calm weather and fewer natural disasters can lead companies to reduce rates in the state so they don’t carry excess profit.

An example of this occurred toward the start of the COVID-19 pandemic. With fewer people on the road, the number of claims dropped overall. Many companies reduced rates or gave temporary discounts to compensate.

Car insurance may go down for a variety of reasons, but the most common reasons are that you are getting older or infractions have fallen off your driving record. If you already have a good driving record, compare car insurance quotes from different companies to see if you can find a better deal.

Top Auto Insurance Recommendations

If you’re looking for a lower rate, our top recommendations for car insurance are State Farm and Geico.

State Farm: Editor’s Choice

Our average rate data shows State Farm is one of the most affordable providers for the average driver. It also offers useful programs and discounts for young drivers. For example, students can save up to 25{e538325c9cf657983df5f7d849dafd1e35f75768f2b9bd53b354eb0ae408bb3c} if they have good grades. Young drivers under the age of 25 can also get a discount for completing State Farm’s educational program, Steer Clear^®.

Keep reading: State Farm insurance review

Geico: Affordable for Most Drivers

Geico is another great option for people looking to save money on car insurance. The company offers 16 discounts including a 15{e538325c9cf657983df5f7d849dafd1e35f75768f2b9bd53b354eb0ae408bb3c} military discount and a 25{e538325c9cf657983df5f7d849dafd1e35f75768f2b9bd53b354eb0ae408bb3c} multi-vehicle discount. Looking at coverage options, Geico offers something unique: mechanical breakdown insurance. This is similar to an extended warranty and covers a variety of parts in the case of mechanical failure.

Keep reading: Geico insurance review

Our Methodology

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.

Here are the factors our ratings take into account:

• Cost: Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
• Coverage: Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
• Reputation and experience: Our research team considered market share, ratings from industry experts and years in business when giving this score.
• Availability: Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
• Customer experience: This score is based on volume of complaints reported by the National Association of Insurance Commissioners (NAIC) and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.

Our credentials:

• 800 hours researched
• 45 companies reviewed
• 8,500+ consumers surveyed

*Data accurate at time of publication.