It is no secret that younger teenaged drivers will pay more in car insurance rates than older, more experienced drivers. Numerous studies have found that young drivers are much more likely to be involved in accidents than their more mature peers, even when both populations have similar levels of driving experience. There appears to be a fundamental difference in the psychology of the average teenager as they may be more likely to take risks or make questionable decisions involving their vehicles. As a result, the average car insurance rates for people under 21 years of age will likely be higher than those of the average adult driver.
Even though inexperienced drivers might pay more for car insurance than responsible drivers, it is still difficult to make a broad generalization about the exact car insurance rates for the average 21-year-old. Car insurance providers use many different factors and criteria to determine a rate appropriate for the policyholder, and many companies offer discounts to students who meet certain criteria. For instance, a provider may offer a “good student” discount if a driver maintains a “B or better” grade point average, and a qualifying driver may notice a decrease in premiums by five to 15 percent.
Another factor that helps to determine the average car insurance rate is the vehicle itself. In general, the cost to insure the car will increase proportionally to its resale value. In other words, a car worth $20,000 will usually require higher premiums than a vehicle that is only worth $2,000. Similarly, a driver who takes out a loan on a vehicle will likely pay a higher monthly premium than a car that is bought and paid for right off the lot. This is due to the fact that many reputable lenders require the vehicles they are backing to have more comprehensive insurance policies that will cover all types of injuries and vehicular damages.
Finally, due to state laws governing auto insurance policies as well as local factors that can increase the possible risk of driving in certain areas throughout the region, the average car insurance rate will depend on the location of the driver. For example, teenaged drivers living in Florida may pay more for a car insurance policy than they would in other states as a result of the state’s vulnerability to damaging floods and storms as well as the state’s relatively high vehicle theft and accident rates.
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Author: Jay White
I started Dumb Little Man so great authors, writers and bloggers could share their life "hacks" and tips for success with everyone. I hope you find something you like!