How age and gender affect car insurance premium rates

January 7, 2022

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RHI Agency Team

Vehicle insurance is one of the most important insurance plans anyone who owns or drives must-have. It is the best way to ensure that you are protected from both the property risk and liability risk, in case of any unexpected events.

The number of vehicles that were registered in the United States in 2019 alone was 276 million. According to statistics, more than 38,000 people lose their lives on the United States roadways due to accidents, and apart from that, about 4.4 million people are seriously injured.

According to the National Highway Traffic Administration, about 5.25 million accidents take place across the U.S every year. All these facts point us towards why having car insurance, especially in the United States is very important.

Car Insurance and change in premium rates

Like other insurance plans when going for vehicle insurance, there are some factors that the insurance agency considers to decide a premium. The main factors are a person’s age and gender and the premium rates may vary considerably depending on these factors.

This might come as a bit surprising for you but women tend to pay less compared to men for vehicle insurance and young drivers pay the most amount of premium. There is a connection between the age and gender of a person and the chances of him/her getting into an accident and hence the variation in premium rates.

Gender as a factor

A detailed study into auto insurance shows that men pay more premiums more than female drivers. But, as the person gains more driving experience with age the gender difference tends to narrow down. A huge difference, in the beginning, will become negligible or even the same at the age of 35.

As women become older, their premiums will get reduced compared to men. According to the Insurance Institute for Highway Safety, this is because the risk for men is considerably higher. According to their analysis men usually spend more time driving than women and indulge more in risky activities like speeding, not wearing seat belts, drunk driving, etc.

Their analysis is supported by the fact that from 1975 to 2019, the number of men who have died in accidents is twice the number of females. According to the U.S. Department of Transportation’s Fatality Analysis Reporting System’s IIHS analysis, 71 percent of the deaths that happened due to motor accidents in 2019 were men.

Though all these facts and analysis states that men are more prone to accidents it is against law to use gender as a factor for determining the premiums of car insurance in states like California, Massachusetts, Montana, Pennsylvania, Hawaii, Michigan, and North Carolina.

Teen drivers and high premiums

The average insurance amount for a teen in the United States is about 6,800 dollars per year if the insurance policy is in their name. That is a huge amount compared to the rates a middle-aged person pays.  Teens are considered to be inexperienced and their risky behavior makes them more prone to accidents.

According to an article by the CDC, teenagers are 3 times more likely to cause accidents compared to drivers above the age of 20. More than 2,500 teens lose their lives in accidents every year and about 200,000 of them get injured.

Some of the factors that increase the risk of getting in an accident and hence the premium are inexperience, nighttime drive, not using seat belts, being distracted from the road, speeding, and alcohol use.

Senior drivers

The best price you can get auto insurance is when you have passed the teen category and before becoming a senior citizen. As you become a senior citizen (above 65) the premium amounts again go up. There can be about a 12 to 21 percent increase in the premium rates for males and an increase of 9 percent for female drivers.

As we get older our health starts to deteriorate. Even if a person does not have any serious illness age can affect a person’s vision, hearing, and motor skills. This is the reason for a significant increase in the premiums.

End Word

An accident can happen even if you are a careful driver. Preventing an accident is not just in one person’s hands and hence the best way to prepare for it is by always being alert on the road and by buying car insurance. The premiums you will have to pay will depend on a variety of factors including your agent and gender and the best way to ensure that you get the best deal is by buying insurance policies from trusted providers like the RH Insurance agency.

RH Insurance agency has over 20 years of experience in the insurance field and houses about 20 different insurance companies under its wing. We can help you to compare your quotes and can get you the best deal possible whether you are owning a car or renting it.  

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