Auto Insurance Policy Rates: Age Matters!

Auto Insurance Policy Rates: Age Matters!

There are some people who are still confused on how do auto insurance companies compute policy rates. Some might be even wondering why is the policy rate of his/her neighbor different from his monthly rate while they both have the same car and same company at the same time. That is pretty normal for people since not all have a good understanding about auto insurance policy rates.

To tell everyone frankly, there are various factors that will determine the monthly policy rates. One of these various factors would be the age. For some, people would say age doesn’t matter at all. Maybe for some other things, it doesn’t. But when it comes to auto insurance policy rates, it matters a lot. Listed below are some of the most common explanations to help everyone better understand how age and different factors affect the monthly auto insurance premium.

Young and new drivers

Recent studies have showed that people belonging to a young age group has a tendency to be more reckless drivers compared to people in their late thirty’s. That study has already been proven and the statistics have showed that teenagers, including college students get involved in accidents more often compared to other people who do not belong under their age group. Because of that, teenage drivers have a higher auto insurance monthly premium rate compared to others.

However, if the insurance company has noticed that the teenage driver doesn’t have any history or bad driving record,