cheapest car insurance for young drivers

Cheapest Car Insurance For Young Drivers

For young drivers, car insurance can often be frustratingly expensive. Teenagers and young adults aged 16-25 tend to pay the highest auto insurance rates, with average annual premiums often exceeding $1000 or more. This is mainly due to the fact that statistically

newer drivers are more likely to get into accidents compared to older, more experienced drivers. Insurance companies view young drivers as high-risk and charge them higher premiums to offset the increased likelihood of having to pay out claims.

However, while car insurance for young drivers is generally more costly, there are plenty of ways to find more affordable coverage. Being a smart, safe driver goes a long way, but you can also take proactive steps to keep your rates down. Here are some of the best tips for getting cheap car insurance as a young driver.

Best Cheap Car Insurance for Teens and Young Drivers 

For many parents, adding their teen driver to their auto insurance policy is a big step. 16 is the minimum age to get a learner’s permit in most states, meaning your kid will soon be behind the wheel.

But insuring a teenage driver is costly – rates can double or triple compared to an adult driver. Here are some top insurers to consider when shopping for the best rates for your 16-year old.

USAA – Overall Best Rates for Teens and Young Drivers
If your family is eligible to join, USAA tends to offer the most competitive rates when adding teens as drivers. They have decades of experience insuring military families and understand the risks of inexperienced teenage drivers. USAA considers teens’ good student status and takes ongoing good grades into account for discounts.

COMPANYADVISOR RATINGAVERAGE COST FOR PARENTS AND A 16-YEAR-OLDCOMPLAINT LEVELLEARN MORE
USAAUSAA5.0$4,103AverageCompare Rates
USAA – Overall Best Rates for Teens and Young Drivers

American Family – Best for Low Complaint Levels
American Family insurance receives top marks from customer satisfaction surveys year after year. They do not have the largest network of agents, but provide reliable coverage and service. American Family looks closely at teens’ driving records and ties future rate changes to safety.

COMPANYADVISOR RATINGAVERAGE COST FOR PARENTS AND A 16-YEAR-OLDCOMPLAINT LEVELLEARN MORE
American Family American Family4.5$5,663Very lowCompare Rates
American Family – Best for Low Complaint Levels

Nationwide – Good Mileage-Based Telematics Program
Nationwide’s Smart Ride program allows parents to monitor teens’ driving behaviors and saves money through safe miles driven. The telematics program provides feedback on hard braking, speeding and more to reinforce good habits. Rates adjust based on measured performance over time.

COMPANYADVISOR RATINGAVERAGE COST FOR PARENTS AND A 16-YEAR-OLDCOMPLAINT LEVELLEARN MORE
Nationwide4.5$4,502Very lowCompare Rates
Nationwide – Good Mileage-Based Telematics Program

Auto-Owners – Highly Rated by Collision Repair Shops
While new to some markets, Auto-Owners has been insuring homes and vehicles for over a century. They have an “A” rating from AM Best and treat collision claims fairly according to repair technicians. Auto-Owners is a solid, budget-friendly choice to protect your family and teen’s first car.

COMPANYADVISOR RATINGAVERAGE COST FOR PARENTS AND A 16-YEAR-OLDCOMPLAINT LEVELLEARN MORE
Auto-Owners4.0$5,412LowCompare Rates
Auto-Owners – Highly Rated by Collision Repair Shops

GEICO – Best if Teen Will Have Own Policy

For experienced drivers who want their own low-cost policy, GEICO sets the standard. Their mobile app allows policy management on the go. GEICO considers teens’ entire driving history and builds in long-term discounts for those with a clean record.

COMPANYADVISOR RATINGAVERAGE COST FOR PARENTS AND A 16-YEAR-OLDCOMPLAINT LEVELLEARN MORE
GeicoGeico4.0$4,471AverageCompare Rates
GEICO – Best if Teen Will Have Own Policy

Shop Around and Compare Quotes

The first step is to spend time shopping around and comparing quotes from multiple insurance providers. Rates can vary widely from company to company, so don’t just go with the first quote you get. Spend an afternoon reaching out to national insurers like Geico,

Allstate, and State Farm as well as local insurance agents and companies. You can also use online quote comparison sites to quickly gather rate estimates. Compare identical coverage from each company, and look for the provider offering the lowest premium.

Shop Around And Compare Quotes
Shop Around and Compare Quotes

Ask for Discounts

Insurance companies offer various discounts that can help lower your premium. Make sure to ask representatives what discounts your provider offers, then see which ones you may qualify for. Common discounts for young drivers include good student,

driver’s education course completion, low mileage, defensive driver, and teenage driver-parent policy. Taking an approved defensive driving course is a great way to save on insurance costs. Maintaining a high GPA and taking advanced classes can also earn you a good student discount.

Increase Your Deductibles

Opting for higher deductibles is another way to reduce your insurance rates. A deductible is the amount you pay out-of-pocket before your insurance coverage kicks in after an accident. Standard deductibles are usually $500,

but you can often increase this to $1000 or even $2000. The higher your deductible amount, the lower your monthly premiums will be. Just make sure you have enough saved to cover the deductible in the event of a claim.

Increase Your Deductibles
Increase Your Deductibles

Only Purchase Necessary Coverage

Don’t pay for unnecessary extra coverage options. Stick to essential insurance like liability and collision. Optional add-ons like roadside assistance and rental car

reimbursement might seem appealing but will drive up the cost of your policy. Review the coverage details closely and decline any extras you really don’t need.

Maintain a Good Driving Record

Unsafe driving behaviors like speeding, DUIs, reckless driving, and at-fault accidents will quickly cause your insurance rates to skyrocket. However, maintaining a clean driving record with no tickets or infractions will qualify you for the lowest premiums.

Safe, responsible driving is the best way to keep your rates affordable. Let your parents add you as an occasional driver on their policy first to build up your record with a few years of clean driving.

Maintain A Good Driving Record
Maintain a Good Driving Record

Take a Defensive Driving Course

Many insurance providers offer discounts for completing an approved defensive driving, driver safety, or driver improvement course. These courses teach cautious, attentive driving techniques and how to avoid accidents.

They can typically be taken online for convenience. Providers like National Safety Council and AAA offer programs that may qualify you for insurance discounts.

Shop Secondhand for a Vehicle

The make and model of car you drive has an impact on your insurance rates. Flashy sports cars, high-powered vehicles, and luxury models are much more expensive to insure. Opt for an affordable, safe, modestly-priced used car instead.

Family sedans, minivans, and older pickup trucks tend to have lower insurance costs. Also, install air bags, anti-lock brakes and anti-theft devices for additional savings.

Shop Secondhand For A Vehicle
Shop Secondhand for a Vehicle

Lower Your Mileage

Insurers offer discounts for driving fewer miles throughout the year. Limiting your time on the road reduces the chances of getting in an accident. Try to keep your annual mileage under 10,000 if possible.

Telecommuting, carpooling, and relying more on public transportation will help keep the miles down. Also, ask if your provider has a low mileage program or pay-per-mile option.

Join a Member Organization

Insurance companies offer special lower rates to certain groups and associations. For example, many providers give discounts to AAA and AARP members. If you belong to a credit union, college alumni association,

student organization, or other group, ask about potential insurance savings. Even smaller clubs can provide access to group policies and discounted rates.

Enroll in Usage-Based Insurance

Usage-based or telematics programs install a small device in your vehicle to monitor driving behaviors and mileage. Safe, low-mileage drivers can qualify for significant discounts based on the data collected.

Providers like State Farm, Allstate, and Progressive offer these telematics options. Agreeing to share your driving information allows the company to accurately assess your risk profile.

Enroll In Usage-Based Insurance
Enroll in Usage-Based Insurance

Have Your Parents Include You on Their Policy

Getting added to your parents’ policy as an occasional driver can really save you money. Their driving history and tenure with the provider will help lower your rate as a new driver.

Make sure you are only listed as an occasional or secondary driver, not a primary policyholder. While sharing a policy, maintain your good record to keep the premiums down.

Choose a Vehicle with Safety Features

Opt for a car with modern safety tech like automatic emergency braking and lane departure warning. Newer vehicles that score well in safety tests also tend to have lower insurance rates thanks to reduced accident risk.

Do your research to find affordable models with the latest protective features. Ask your insurance agent how adding certain safety packages impacts pricing.

Consider Paying Annually

Paying your entire 6-month or 12-month premium upfront rather than in monthly installments can lead to discounts from some insurers. The one-time lump sum saves the company administrative fees and interest

charges from spreading out your payments. Just make sure you have the funds available to pay the full premium at once. While not all companies give a break for annual premiums, it’s worth inquiring about.

Find the Right Balance of Coverage

Don’t go overboard with excessive liability limits or unnecessary extra coverage, but also don’t try to save by skimping on essential protection. Work with your agent or

use online quote tools to find the sweet spot of adequate, affordable coverage. Balance minimum required limits with added protection to build the optimal tailored policy.

Find The Right Balance Of Coverage
Find the Right Balance of Coverage

Search for Provider Discounts

Check companies you already do business with like banks and credit card issuers. Often, existing financial institutions will offer special discounted rates to account

holders who also purchase insurance through them. For example, a credit union may provide a break on premiums for members who get insurance policies.

Raise Your Credit Score

Believe it or not, your credit report plays a role in setting your insurance rates in most states. Insurers have found a correlation between low credit scores and higher claim likelihood.

If you have poor credit, take active steps like paying bills on time and paying down debts to raise your score. This can earn you lower risk premiums from some insurance companies.

Drop Unnecessary Local Coverage

If you are heading off to college but still on your parents’ hometown policy, make sure to remove the unneeded local coverage. Policies routinely include some level of medical payments, personal injury protection,

and uninsured motorist coverage. But out-of-state students don’t require local coverage. Removing it can trim some costs off the premium.

FAQs

What insurance is cheapest for young drivers?

The cheapest car insurance for young drivers is usually basic liability coverage, which covers property damage and injuries you cause to others if you’re at fault in an accident. Young drivers can keep costs down by staying on their parents’ policy, driving an older or cheaper car, taking defensive driving courses, maintaining good grades, limiting mileage, and asking for discounts.

What car insurance is cheapest for new drivers?

For new drivers, the cheapest car insurance is minimum liability coverage, which is required by law. Rates are high for new drivers due to lack of experience. Ways to save include completing a driver’s education course, staying on your parents’ policy, driving an older used car, limiting mileage, maintaining good grades, inquiring about discounts, and comparing quotes from multiple insurers.

What is the cheapest car insurance for people under 21?

The cheapest car insurance for drivers under 21 is minimum liability coverage with high deductibles. Rates are very high due to inexperience. Savings tips include staying on a parent’s policy, limiting mileage, maintaining good grades, taking a defensive driving course, driving an older used car, and comparing quotes from multiple insurers.

What is the cheapest insurance for a 21 year old?

For a 21-year-old, the cheapest car insurance is basic liability coverage with high deductibles. Rates start dropping after age 21. To save, a 21-year-old can stay on their parents’ policy, limit mileage, drive a safe and inexpensive car, take defensive driving classes, maintain good grades, inquire about discounts, and compare quotes.

Conclusion

In conclusion, finding affordable car insurance as a young driver can take some effort but is possible. The key factors that insurers look at are your age, driving history, vehicle, location, and more.

Shopping around with multiple quotes is important to compare rates. Considering optional restrictions like higher deductibles or usage-based policies may lower your premiums as well. While basic liability coverage is required by law, opting for higher

coverage limits provides better protection. Maintaining a clean driving record over time as you gain experience is also a good long-term strategy for lowering insurance costs. With patience and research,

young drivers can identify the most cost-effective insurance options that fit their budget and needs. Prioritizing safety behind the wheel will also support keeping insurance affordable in the future.

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