If you’re a young person, car insurance under 25 may be quite expensive. Rates for young drivers (under 25) is more expensive at most auto insurance companies for two major reasons: lack of driving experience and previous driving record. Younger drivers are considered a higher risk, and that results in higher premiums.
There are some things you can do to lower your insurance premiums. Here are some tips on buying car insurance under 25.
- Buy a cheaper vehicle – The new models – especially sports cars and luxury vehicles — are more expensive to insure, and lenders usually require insurance that includes collision and comprehensive coverage. If you pay cash and buy a cheaper vehicle, you may opt to forego collision coverage and stick with liability.You may be able to save as much as 50 percent on your insurance premium. Remember, however, that you’ll have to pay the cost of any repairs to your vehicle if you eliminate collision coverage.
- Maintain a good driving record – If you want less expensive rates – even for car insurance under 25 – a good driving record is one of the most important things you can do.
- Increase your deductible –The deductible is the amount you have to pay before your auto insurance coverage kicks in. Amounts vary from $0 to more than $1,000, but keep in mind that this is money you have to pay out-of-pocket before your insurance will cover anything.
- Take defensive driving course – In some states, defensive driving courses are offered that can result in savings on your car insurance premiums.
- Get good grades – There’s also the good student discount, which you can get if you maintain a B average in school.
- Take alternate transportation – The less you drive, the more likely you are to qualify for a discount for low annual mileage.
- Discounts for safety features – Be sure the car you purchase has certain safety features that insurance companies look for to give a safety discount. These include airbags, automatic seatbelts, anti-lock brakes and anti-theft device.
- Maintain good credit score – Pay all your bills on time with no missed payments. Auto insurance companies will check your credit score before they decide to insure you. A high credit score gives you a better chance at a lower car insurance premium.
- Shop around for best rates – Finally, it’s important to compare rates for car insurance under 25 among multiple auto insurance companies.
What if you don’t have a job and are still in school? See if you can get insured under your parents’ policy. Piggybacking on bundled policies (homeowners, multiple-car households) can result in significantly lower premiums for car insurance under 25.
For more tips on car insurance, visit our section on car insurance where you can get additional tips and insurance quotes.