Car insurance policies can be kind of pricey. But you have to have one if you want to drive (legally).
The costs of car insurance will depend on a lot of factors. One of the biggest ones is how old you are.
Insurance companies price their policies based on a risk assessment. And young, less experienced drivers are more likely to get into an accident. Which means the insurance companies will charge them significantly higher car insurance rates than older, more experienced drivers.
Especially when they have their own policy (ie. they are not under their parent’s insurance), teen drivers pay some of the highest rates for car insurance.
But how about when you leave your teens behind? Below, we look at how much is car insurance for a 20 year old. You’ll learn about the average costs and other factors that will affect how much you pay for insurance.
How Much Is Car Insurance For A 20-Year Old?
The costs of car insurance policies vary. It depends on a variety of factors, including the insurance company, your gender, your age, where you live, and more.
For the purpose of this article, we will focus on the age factor. Specifically, getting car insurance for the average 20-year-old.
Car insurance premiums can vary a lot based on your gender, what company you use, the type of coverage you get and other factors. And for a 20-year old, you can see annual premiums range anywhere from around $2,500 to over $8,000!
You can figure the national average to be right in the $5,000 – $5,500 a year range. That’s almost $2,000 less than what the average 18-year old pays. But it’s around $2,000 more than the average 30-year old pays for insurance.
Factors That Affect The Rates Of Car Insurance For 20-Year Olds
But other factors could also affect the premiums of your car insurance policy. The first one is gender.
Gender
Most of the time, the premiums for 20 years old female drivers are significantly lower compared to male drivers of the same age. In fact, female drivers will pay about 10% less than men for the same car insurance policy. Average premiums for male drivers are close to $5,800 while females pay closer to $5,200. However, in some states, it’s illegal to charge different amounts based on gender.
Coverage Level
Everyone has to buy at least the minimum amount of insurance coverage. This means only buying liability coverage. Full coverage on the other hand includes comprehensive and collision coverage as well.
If you only get liability, rates will generally be less than half of what a full coverage policy costs. However, if you get in an accident, you will be liable for a lot more expenses.
Where You Live
The state you live in has a big impact on insurance rates too. Bad news for those of you living in Michigan where 20 year-olds pay an average of over $16,000 a year for car insurance. If you live in North Carolina, however, the rates average just a little over $2,000.
Car Insurance Company
There are a lot of car insurance companies out there. And their rates can vary widely. So it pays to shop around and get quotes from 3 – 5 companies, if not more. You can save yourself $1000s a year by doing this.
But keep in mind the cheapest policy may not be the best one. You have to take into account the policy details and the reputation of the insurance company too.