Several factors contribute to the car insurance rates you pay. Insurance companies generally consider your age, gender, driving history, occupation, the make and model of the vehicle you drive and where you live when determining the cost of the premium it will charge you. Drivers under the age of 25 typically pay higher insurance rates. Although the lowest auto insurance rates kick in at about age 40, once you reach age 25, the cost of insurance begins to decrease.

Average Rate Decrease

Male drivers can expect an average decrease in car insurance rates of 20 percent after they reach the age of 25. That is if you have a safe driving record and haven’t been involved in any automobile accidents. Rates for female drivers drop about 15 percent. Rates don’t decrease as much for female drivers who, in most cases, already pay less car insurance. Before age 25, insurance companies consider younger drivers inexperienced and more careless, which makes them a higher accident risk. After that age, individuals have graduated from college and are working a regular job. By that time, some individuals have married and started their families. These things make them more responsible adults in the eyes of insurance companies.

Risk Factor

Although teen drivers account for only about 7 percent of the licensed drivers in the U.S., young drivers between the ages of 16 and 24 are involved in almost 15 percent of all fatal motor vehicle accidents, according to the American Safety Council. Driving at unsafe speeds is a common cause of accidents involving teens. Statistics show that more than one in five teenage drivers is involved in an accident during the first year of being a licensed driver. Inexperience driving in combination with indulging in reckless driving behaviors like speeding, driving under the influence of alcohol or drugs and having other teens as passengers in the vehicle place this age group at higher risk for auto accidents.

Driver Behaviors

Insurance companies generally classify males under the age of 25 as high-risk drivers pushing up the price of their auto insurance. Young men in this age category receive the highest number of tickets for speeding and reckless driving. They are less likely to wear seatbelts increasing their risk of suffering serious injury if involved in an auto accident. This group of drivers also accounts for the highest percentage of DUIs, reports the CDC. Male drivers younger than age 25 cost insurance companies money by filing more insurance claims than other categories of drivers.

Premiums Decrease Over Time

Car insurance premiums typically go down at ages 21, 25, 30 and 35. Unless you have an accident or get a traffic ticket, rates usually remain stable for a time. Check your policy soon after you reach each of these age categories, as you should be able to save money on your premium. If it has been five years since you were last involved in a motor vehicle accident, or if you’ve had no accidents, you may qualify for a good driver discount. Auto insurance companies often offer discounts to policyholders with credit scores of 720 and above. While younger consumers tend to have lower credit scores, maintaining a good payment history over time will continue to boost your score.