Shop around. Young adults can save hundreds of dollars as they move out of the age-penalty box, get married, start a career or build a credit history. By Erin Burt, Contributing Editor February 8, 2007 When it comes to car insurance, young adults tend to take the path of least resistance -- and that could be costing them hundreds of dollars a year. Once you move out from under your parents' roof or buy your own car, most insurance companies will require you to buy your own policy instead of keeping your coverage under Mom and Dad's. When that day comes, many of us simply stick with the same company as our parents, opening our own policy without even looking around to see what else is available. RELATED LINKS Smart Shopper's Guide to Auto Insurance How to Trim Your Car Insurance Bill A Grad's Guide to Getting Around The truth is, rates for the exact same level of coverage can vary dramatically from company to company due to variances in their operating costs, past claims experience and formula differences. So it really pays to re-shop your policy among as least three insurers to see who can offer you the best deal for your age and situation, which, obviously, are much different from your parents'. Why reshop? Even if you're happy with your policy, it's a good idea for anyone of any age or life stage to examine his or her coverage now and then to make sure he or she is getting the best deal. But it's especially important for young adults because several factors that go into calculating your rate are in flux in your twenties and thirties. Insurers reward customers who are responsible. And according to industry studies, these four factors can improve your estimation in their eyes and potentially snag you lower rates: 1. You're getting older. Rates for young drivers peak at age 16 or 17 and slowly decline, but the age penalty doesn't entirely disappear until you turn 25 or so. The closer you are to breaking out of the penalty box, the better your rates should be. For example, according to Insure.com, men can expect about a 20% drop in their premium between ages 23 and 25. Young women, who typically pay less than their male counterparts, can save between 10% and 15%. 2. You're building a credit rating. If you manage your finances well, insurers think you'll be a responsible driver, too. When you're starting out, your credit rating may be non-existent, and you'll probably pay higher rates. As you get your first credit cards and begin building your credit history and managing it well, insurers will smile upon you with lower rates. 3. You're starting a career. Your college degree could be of interest to your auto insurer. Several companies reward drivers with advanced degrees or who work in certain professions. Scientists, pilots, actors and artists pay the lowest rates while business owners, executives, lawyers and nurses tend to pay the highest rates, according to a study by Insure.com. Joining a professional group or becoming a member of your college alumni association also could save you money on your insurance. 4. You may have gotten married. Insurers view coupledom as a sign of responsibility. So if you get married before the age penalty disappears at age 25, you could qualify for a lower rate than when you were single -- especially if you're a man. You and your new spouse should also consider teaming up. You can save about 10% to 30% on your car insurance by combining policies instead of maintaining separate ones. Shopping in a snap Re-shopping your car insurance is so easy, you really don't have any excuse not to. One of our favorite sites for comparing auto policies is InsWeb.com. You spend a few minutes typing in information about yourself, your vehicle and your driving record. You then get immediate price quotes from up to six companies (the number varies by state). For an accurate price, you'll need to provide your Social Security number and let the insurer look up your driving record and credit history. If you want a personal touch, Independent Insurance Agents & Brokers of America can help you find an agent in your area. These agents work with many companies and know from experience which ones are likely to have the best deal for you. A few companies don't sell through independent agents or on InsWeb. So you'll need to go directly through the company's Web site to get quotes from Geico, Progressive or Esurance. And some companies, including State Farm, sell only through their own agents. Not sure what kind of coverage you need? See our Smart Shopper's Guide to Auto Insurance to decode the lingo and make sure you get the right policy for your needs. But remember, price isn't everything. You want to make sure the insurance company you choose has a good reputation. Ask your local body shop about the best insurance companies because they work with insurance adjustors regularly and can probably tell you which firms have the smoothest claims process. You should also visit your state's insurance department Web site because many publish consumer complaint data. (You can access your state's site through the insurance page on Kiplinger.com.) To make sure the company is financially sound when it comes time for you to file a claim, research a company's stability through A.M Best or Standard & Poor's. And of course, it's important to find out if the company provides a level of service with which you are comfortable. For example, are you okay dealing with a call center or do you prefer a personal agent? Does the company treat you with respect and do its best to answer your questions, or does it seem more eager to close the deal and collect your money? Other ways to lower your rates While life changes in your twenties and thirties can certainly affect your rates, there are other, more active steps you can take to ensure you are getting the best possible deal on your auto insurance. Combine policies. When shopping around, check first with the company that provides your renter's or homeowner's insurance. You could snag up to 15% off for a multiple-line policy. Drop collision and comprehensive on an old car. If you drive a beater -- say, one worth less than $2,000 -- you'll probably pay more to insure it than you would ever collect on a claim. Dropping that part of your coverage can reduce your premium by one-third. Raise your deductible. Upping your out-of-pocket outlay from $250 to $1,000 on any car can save you 15% or more. Clean up your driving record. Three years without a ticket or accident are usually enough to qualify you for the lowest premiums available. It pays to drive safely. Boost your credit score. We've mentioned credit scores above, but you needn't settle for a mediocre or nonexistant rating. Taking small steps to improve your score can lower your insurance rates in a big way. Get more tips on how to trim your car insurance bill.