Age Tax? Unjustified High Car Insurance Premiums Most Common for Gen Z, Boomer Drivers

Elin Nozewski
Jan 28, 2022 · 5 min read
More Expensive Premiums for Safer Driving Records Defies Logic
PALO ALTO, Calif. ー August 23, 2021ーIs there an age tax for car insurance buyers? New data from car insurance compare and buy app Jerry indicates there may be in some U.S. states. The youngest and oldest drivers, Gen Z and Baby Boomers, are most impacted by these findings.
“The car insurance premiums defy common sense,” said Lakshmi Iyengar, data analyst at Jerry. “When reviewing violations, one of the most important factors in insurance premiums, the data shows that two generations are often being priced higher regardless of violations ー Gen Z and Boomers.”

Gen Z Impact

Jerry examined more than 1 milion car insurance premium quotes for self-insured customers across the United States and found in 17 states Gen Z drivers pay higher car insurance premiums than Millennials despite having equal or fewer frequencies of driving violations. According to the CDC, the risk of motor vehicle crashes is higher for teen drivers than any other age group, and younger drivers are believed to be riskier. But new data from Jerry shows that Gen Z drivers, ranging from 17-24 years old, have equal or lower driving violation frequency when compared to Millennials. These states aren’t bound to any specific region, indicating that age is the deciding factor in premium cost.
When looking at national averages, Gen Z and Millennial drivers have comparable rates of violations (25% vs 24%, respectively). However, the average car insurance premium for a Gen Z driver is $314ーwhich is $54 more per month than the average premium for Millennial drivers, who pay an average of $260 per month. Based on the federal minimum wage, this means that a Gen Z driver has to work eight hours more than a Millennial driver each month to pay their monthly car insurance premium.
Maryland is a particularly extreme case. The Gen Z driver violation rate is only 0.55% higher than that of Millennial drivers, but Gen Z drivers pay $150 more per month on average than Millennial drivers in the state. This is compounded by the fact that Maryland has a minimum wage of $11.75. This means if an average Gen Z driver was working a minimum-wage job, they would need to work an entire week (40 hours) to cover their monthly car insurance premium.
States Where Younger Drivers Pay More Despite Less or Equal Violations
**State****Percent of Gen Z Drivers with one or more Violations****Gen Z Average Car Insurance Premium****Percent of Millennial Drivers with one or more Violations****Millennial Average Car Insurance Premium**
North Carolina24.52%$218.0530.73%$172.79
North Dakota6.42%$168.1412.84%$71.86
New Hampshire18.54%$255.7331.93%$233.88
New York16.95%$537.4721.75%$519.85
Rhode Island18.87%$395.2424.3%$376.27
South Carolina39.2%$350.3840.35%$282.69
The 17 states shown in the above table are not regionally concentrated. These states also range from primarily urban to primarily rural, and all have varying violation rates. The most prominent difference between the two groups is age.
Gen Z drivers also have the highest average insurance premium across all age groups nationally — ultimately paying $54 more per month than Millennials, $105 more than Gen X, and $104 more than Boomers.

Boomer Impact

Gen Z is not alone in paying an “age tax”. Despite lower rates of violations, Boomers pay more than Gen X for car insurance premiums in 11 states ー Iowa, Indiana, Missouri, North Carolina, Nebraska, New Jersey, Ohio, Rhode Island, Tennessee, Virginia, and Wisconsin. Not only do Boomers have lower violation rates in those states, but they are also statistically the safest drivers out of any age group, with a national average violation rate of 10%.
While states that charge Gen Z drivers higher premiums aren’t regionally focused, states where Boomers are charged more are primarily located in the eastern U.S. However, a recent study reported that, on average, East Coast drivers ー even those with no violations ー pay about 45% more in monthly premiums than drivers on the West Coast. Although this doesn’t account for why Boomers with safer driving records are being charged more in their own state than Gen X drivers, it does begin to explain why their monthly premiums are higher overall.
A detailed analysis on car insurance prices by generation is available in the the full study. Additional driving trends and car insurance research is also available on the Jerry website. Studies include East Coast vs West Coast driver cost comparisons, electric vehicle driver demographic insights, and teen insurance premiums.


Jerry analyzed more than 1 million car insurance quotes from July 2020-July 2021. Drivers aged 24 and below were designated Gen Z, drivers 25-40 were designated Millennials, drivers 41-56 as Gen X, and drivers 57-75 as Baby Boomers. All quotes were single-car policy and nationally representative, with quotes from all 50 states. Driver age was the age of the primary policy holder. Gen X drivers are not dependents on their parents policy, but are insured on their own. This study did not account for average car value or average miles driven for each age demographic.

About Jerry

Jerry saves you time and money on your car expenses. Jerry first launched its AI- and machine-learning-based car insurance comparison service in 2019 and today serves more than 1 million customers as a licensed insurance broker in all 50 states. For more information or to save money on car insurance, visit or download the Jerry app in the App Store or Google Play.

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