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Auto Insurance & The 25 Milestone

Posted By Jim On 08/19/2005 @ 7:50 am In Insurance | 13 Comments

About a month ago I quoted auto insurance rates to get a pre-25 year old rate [3] so that I could re-quote and get a post-25 year old rate. Well, the time now has come for me to re-quote and see what the “big 25 year old milestone auto insurance rate quote drop” people always talk about really amounts to…

Given my current plan (Liability only) where I paid $436.60 for six months, my post 25 year old rate dropped -$59.50 to a mere $377.10. Looking back, carrying $1000 deductibles on collision and comprehensive coverage would cost me $959.50 for six months… now, a mere one month later, it only costs me $808.50 (-$151).

As for Progressive, for identical coverage it actually costs more now, $497 – an increase of $49! For full coverage? $816.00, a jump of $79! As for “the rates of other top companies” – this time four companies (one of them Progressive) were listed, including our old friend State Farm Mutual Automobile Insurance Company. Two newcomers to the show are Erie Insurance Exchange and Erie Insurance Company (same company really but two quotes).

For my coverage, the Erie brothers show a rates of $205 to $232 and $230 to $269 (based on credit score) which is ridiculously cheap auto insurance. State Farm came back with a quote of $412 – still more expensive than Geico. For full coverage, State Farm would charge $750 (cheaper than all comers including Geico), and the Erie’s would charge at least $350 and $380 per six months.

(Incidentally, Erie Insurance Exchange is “better” and only accepts folks with at most one violation, all others fall to the Erie Insurance Company, hence the price differences)

To recap, in table form:

Company Coverage Pre-25 Price Post-25 Price % Diff
Geico No C/C $436.60 $377.10 -13.6%
Full $959.50 $808.50 -15.7%
Progressive No C/C $448 $497 +10.9%
Full $737.00 $816 +10.7%
State Farm Full $1,162 $750 -35.5%

So what’s the moral? You can probably expect a rate drop of at least 10% whenever you turn twenty-five. Is it a huge drop? Depends on your perspective but there is definitely a noticeable drop. I think my quoting from Progressive itself may have been flawed either this time or the first time because there is now way the price should’ve increased when all others dropped. What’s interesting is the appearance of Erie Insurance – as if to say they only trust drivers over twenty-five…

What other major auto insurance milestones have you reached and seen a big drop in insurance? I’m curious to see how significant each of these commonly assumed milestones truly are.


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[3] I quoted auto insurance rates to get a pre-25 year old rate: http://www.bargaineering.com/articles/car-insurance-milestone-at-age-25.html

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