Monday, September 26, 2022

Cheapest Car Insurances For Young Drivers

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Unfortunately, there is no absolute cheapest insurance company for college students and drivers under 25. Every insurance company calculates risk differently, which means prices vary from company to company. However, there is a simple solution when looking for an affordable insurance plan: shop around. Do your homework and get multiple quotes.

But whos got time for that? We can help you expedite your search with a single form that will give you multiple quotes at once. You can compare insurance prices side by side, lock in your best rate, buy, and be done.

Cost Of Adding A Teenager To Car Insurance

Age of Primary Driver

$4,801

Note: Sample quotes are based on a 16-year-old driver.

Having a young driver on the policy can have drawbacks for the primary policyholder. Because your policy will pay for their claims, your teen’s driving habits become part of your insurance history. If your child gets into an accident, you will see premiums go up for everyone listed on the policy. Teens are risky drivers and four times more likely to crash, so your rates could definitely be affected. Premiums increase for about three to five years after a claim.

On the bright side, you’ll be eligible for discounts your teen might not be, like bundling with homeowner’s coverage. Plus, you may be eligible for additional discounts if your child has good grades, attends driver education courses, or takes a defensive driving class.

Most car insurance companies will require teenagers who live with parents to be listed on the parents’ policy. If you’re a parent of a teen with a learner’s permit, your teen should be typically covered by your policy with no action necessary on your part. But as soon as a teen driver is licensed, you’ll need to add them to your policy or prove that they are either insured or permanently residing elsewhere.

The cheapest way to get car insurance for a teenager is to add the teen to a more experienced driver’s policy, like a parent or guardian. Plus, it’s always a good idea to shop around and get quotes from multiple companies to find the cheapest option.

Cheapest Car Insurance For Teen Drivers From Large Companies

To determine the cheapest insurers for teen drivers, we first looked at large companies that are available in almost every state.

The five largest auto insurance companies in the country are Allstate, Geico, Progressive, State Farm and USAA. However, USAA insures active military members, veterans and their families only.

Below weve ranked the largest companies, excluding USAA, from cheapest to most expensive based on average annual prices for both full and minimum coverage.

Geico

$3,911

$1,417

Coming from a large company doesnt make an insurance policy better local and regional insurers often have the cheapest rates in those areas. Before choosing a car insurance company, make sure to shop around for quotes to find the cheapest insurer in your state.

» MORE: Allstate, Geico, Progressive or State Farm: Which one is best for you?

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Black Box Insurance For Young Drivers

One of the most popular car insurance policies with young drivers is a black box policy or a telematics policy. This type of policy could help reduce the cost of your premium, especially if you are a young driver. Young drivers are considered a higher risk as they dont have much driving experience, but with a black box they are able to show insurers that they have good driving habits.

You are probably wondering what a black box policy is and what it entails. Quite simply, once you have purchased a black box policy, you will have a black box installed into your car. This will record your driving habits, such as speed, braking, acceleration and cornering and send this back to the insurer.

With this data they will be able to tell if you have good or bad driving habits. If you have good driving habits, some insurers may give you a reduction in your premium. However, if you have bad driving habits and continue to drive badly, then you could see yourself with a cancelled policy.

You can find out more about black box insurance and the benefits it has for young drivers here.

Expert Insights To Help You Make Smarter Financial Decisions

5 Best Cheapest Car Insurance in Florida For Young Drivers

ValuePenguin has curated an exclusive panel of professionals, spanning various areas of expertise, to help dissect difficult subjects and empower you to make smarter financial decisions. Read on for auto insurance insights.

  • Do you feel that parents having their teen children take on the responsibility of a big purchase, such as a car, provides a teachable moment that is worth the monetary cost? Why or why not?
  • Some states prohibit the use of gender to determine insurance rates, even though the motor vehicle death rate of male 16- to 19-year-olds is nearly double that of females of the same age. How do male and female teens pose different levels of risk to insurers?
  • The North Carolina Department of Transportation has the right under law to suspend teens driving privileges if they drop out of school or do not pass at least 70% of their courses. Should academics play a strong role in a teens eligibility to drive? Why or why not?
  • What is the psychological difference between learning in the classroom and learning “on the road” as a driver?
  • The commentary provided by these industry experts represent their viewpoints and opinions alone.

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    Average Cost Of Car Insurance For 20

    Of the young drivers demographic, 20-year-old drivers have the highest annual car insurance rates on average.

    Heres what our analysis of 2020 car insurance rates by state shows for 20-year-old drivers with good credit and no recent accidents:

    • Hawaii is the cheapest state for full coverage insurance with an average annual rate of $1,105, followed by North Carolina and Idaho.

    • Louisiana is the most expensive state for full coverage at $5,650 per year on average .

    • Hawaii is the cheapest state for minimum-required car insurance with an average annual rate of $362. North Carolina and Iowa have the next cheapest yearly rates on average.

    • Michigan has the most expensive minimum-required car insurance on average per year at $2,605.

    See below for how your state stacks up for both full and minimum coverage rates for 20-year-old drivers.

    State

    $1,829

    How Are Rates Determined For Young Drivers

    Auto insurance rates for young adults are determined in the same way as they are for older drivers. Several rating factors that determine car insurance premiums, including:

    Because these variables will change your rate from carrier to carrier, it can be helpful to get several quotes before settling on an auto insurer.

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    Remain On Your Parents Policy

    Since most of us want to keep our costs down, remaining on mom and dads policy until we can afford our own is a quick way to save money on car insurance. Youll need to have the same permanent address as your parents to make this work. Staying on a parents car insurance policy helps young drivers keep rates reasonable.

    Cheapest Car Insurance For 21

    Cheapest insurance for young drivers and the top 4 companies to get quotes from

    While rates are on the high side for 21-year-olds, theyre typically much lower than rates for car insurance for teenage drivers. Average annual premiums for full coverage range from a low of $1,552 in North Carolina to $6,257 in Michigan.

    StateAverage Full Coverage Cost for 21-Year-OldsCheapest Provider for 21-Year-Olds

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    Best Cheap Car Insurance For Young Adults

    Home MediaCompare car insurance quotes

    Cheap car insurance for young adults isnt always easy to find, but its out there for drivers who are willing to search. Rates are nowhere near as expensive as for 16-year-olds, and they usually continue to decrease as a driver ages.

    We at the Home Media reviews team researched the countrys best car insurance companies and have now ranked them for young adults. We took into account each providers standard costs, coverage options and customer service when deciding which companies stand out for this age group.

    Cheapest Car Insurance For Teens

    State Farm offers the cheapest widely available car insurance for teens, but Auto-Owners has the best rates for parents that add a teen to their policy

    Find Cheap Auto Insurance Quotes for Teens

    Regional insurers are also an affordable option, as companies like Erie and Country Financial can offer rates even lower than State Farm’s.

    Joining a parent’s car insurance can save a significant amount of money an average of 62%, according to a ValuePenguin analysis of thousands of quotes from multiple states. Full-coverage car insurance for an 18-year-old driver on their own policy costs an average of $4,917 per year.

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    Utah’s Minimum Car Insurance Requirements

    Utah state law requires drivers to carry the following minimum auto insurance limits:

    • Bodily injury liability per person: $25,000
    • Bodily injury liability per accident: $65,000
    • Property damage liability per accident: $15,000

    Additionally, Utah is a no-fault state. This means that your auto insurance provider will pay for your damages and medical bills regardless of who is responsible in the event of an accident. Accordingly, Utah state law also requires drivers to carry at least $3,000 in personal injury protection coverage. PIP covers costs that may arise after an accident, such as medical expenses and lost wages.

    While these limits may seem high, an extended hospital stay or court case after an accident can burn through them quickly. Any costs above your limits come out of your pocket, which can be substantial if you own an expensive or new car. In order to secure your own financial protection and peace of mind, we recommend increasing your coverage limits to the following:

    • Bodily injury liability per person: $100,000
    • Bodily injury liability per accident: $300,000
    • Property damage liability per accident: $100,000

    How To Get The Lowest Insurance Rates For Young Drivers

    Cheap Car Insurance Uk Young Drivers

    The best way to find the cheapest auto insurance for young adults is bycomparing quotes from multiple insurance companies in your area before picking a policy.

    This way, you can easily see the most affordable companies and avoid paying more than you have to.

    Other easy ways that you can get the best and cheapest auto insurance for young adult drivers is by:

    • Dropping some coverage: If you drive a used car that isnt worth much anymore, it might be smart to drop collision and comprehensive coverage. These coverages are often among the most expensive parts of an insurance policy, and dont make sense if your car wouldnt cost much to replace.

    • Increasing your deductibles: On the other hand, if you drive a newer vehicle, consider raising your deductible amounts to get cheaper car insurance. A higher deductible , limits the amount of damage you can make a claim on, but it also makes your premiums much more affordable.

    • Keeping a clean driving record: While car insurance for young drivers is expensive, your rates will go down over time as long as you avoid accidents, tickets, and other moving violations. If you don’t, your rates may increase by thousands of dollars.

    • Re-shop yearly: Every time your policy is up for renewal, shop around a little to see if you could be getting better rates somewhere else. This is one of the best ways to save money on car insurance over time.

    Compare rates and shop affordable car insurance today

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    Seriously Consider Medical Payments Coverage

    Depending on the severity of your accident, the medical bills you receive can also be astronomical. Thats the last thing you want to worry about when your car has been totaled and your insurance rates have already gone up.

    Medical payments coverage does exactly what it sounds like itll pay for your medical bills while youre recovering from an accident.

    Cheapest Auto Insurance For 16

    Erie and COUNTRY Financial are the cheapest auto insurance companies for 16-year-olds. The cost of coverage from both companies is $262 per month. Since this age group is typically the youngest and least experienced out there, its difficult to find cheap insurance as a 16-year-old.

    MAPFRE is the only other insurance company to offer coverage for less than $300 per month.

    Rank

    Cheapest auto insurance for drivers 25 and younger.

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    Cheap Car Insurance For Young Drivers By State

    The cheapest car insurance company for young drivers varies by state. For example, the cheapest average full coverage rate for a young driver in Idaho is $679, while the cheapest average rate in Kentucky is over $2,000.

    State regulations also impact rates. For instance, Hawaii doesnt use age as a factor when calculating car insurance rates.

    Use the table below to see the cheapest car insurance company for young drivers for a full coverage policy in your state. This table excludes USAA, which often has the cheapest rates on average but is available only to military members and their families.

    State

    Get started on Insure.com

    How To Get Car Insurance In Florida

    The cheapest car insurance in the US for young drivers

    We recommend reaching out to Allstate, Geico and State Farm for car insurance quotes if youre a Florida driver. USAA is a smart choice for military families, and Progressive can provide great rates to high-risk drivers.

    Its always best to get more than one auto insurance quote. With multiple quotes, you can effectively compare coverage and costs to see who offers the most affordable car insurance rates for your unique profile.

    Compare car insurance quotes

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    Average Cost Of Car Insurance For 17

    While not as costly as for a 16-year-old, car insurance for a 17-year-old driver will be a hefty sum. The national annual average rate for a 17-year-old is just over $5,370 for full coverage and $2,206 for minimum coverage.

    Besides Hawaii, North Carolina has the lowest annual average rate for a full-coverage policy for a 17-year-old at just under $2,660. The cheapest annual minimum coverage rate for a 17-year-old in Iowa is just over an average of $930. On the other end of the spectrum, Louisiana has the highest average full coverage rates for 17-year-olds $9,255 for a 12-month, full-coverage policy. Michigan has the most expensive annual minimum coverage rate at just under $4,070, on average.

    See how your state stacks up for full and minimum coverage average rates for 17-year-old drivers.

    State

    $976

    How Teens And Young Drivers Can Get Car Insurance Coverage

    To get started, collect and compare car insurance quotes from multiple providers. This will help you find not only the best price but also the right coverage for yourself or your teen driver.

    Once you have the right quote, determine what purchasing options are available. While some companies only allow you to buy insurance through an agent, others may allow you to receive a quote and purchase a policy online. Either way, be sure to ask what kinds of discounts are available.

    When your policy becomes active, there is typically an online dashboard or mobile app that allows you to manage your payments and view claims in some cases, you can file claims or request roadside support online, but in others, youll need to call.

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    Reduce Your Coverage Limits

    Lowering your car insurance coverage leaves your car and finances less protected, but it can help you get the cheapest auto insurance on the market. Youll likely be required to carry bodily injury liability coverage and property damage liability insurance. In some states, minimum coverage may be more extensive than that.

    However, youll pay higher rates if you add optional types of insurance such as comprehensive or collision coverage. In certain states, uninsured motorist coverage isnt required either.

    Drivers with add-on coverages such as roadside assistance, rental car reimbursement and accident forgiveness could decrease their insurance costs by cutting them out.

    Safecos Teen Safety Rewards Program

    Cheap Car Insurance Young Drivers Ireland

    Although Safeco isnt as large as the other providers listed above, we included it for its extensive offerings for teens. Safecos teen program includes tips, rewards points, and discounts for new drivers. Some of the car insurance discounts you can get for 18-year-old drivers include:

    • Good student discount for maintaining a B average or higher
    • Driver training course discount for completing pre-approved courses
    • Distant student discount for students who go to school over 100 miles away from home without a car
    • Newly independent discount for drivers who were previously listed on their parents policies and are now opening their own
    • New teen rewards for customers of over one year that are adding a teen to their policy

    The Road Ahead Guide gives you general driving tips, tips on driving in hazardous weather conditions, and more. Plus, Safecos RightTrack app monitors safe driving habits like mileage, acceleration, braking, and time spent driving at night to qualify you for discounts. Finally, Safeco offers a parent-teen contract that outlines clear expectations and rules for new drivers behind the wheel.

    Read more in our full Safeco insurance review.

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    How Much Does Car Insurance Cost Drivers Under 25

    How much is car insurance for drivers under 25?

    Drivers 25-years-old and younger typically pay the highest auto insurance premiums. The average cost of car insurance for drivers under 25-years-old is $285 per month.

    Whether its a full-coverage car insurance policy or minimum coverage, young drivers tend to pay more than drivers with more experience. The main reason for this has to do with the number of years behind the wheel. Younger drivers havent been driving for as long and are more likely to have an accident.

    Factors such as location, coverage type, driving history, and vehicle will also play a role in determining the final rate. Young drivers may be eligible for various discounts to help decrease their monthly costs, like good student discounts or bundling with renters insurance. Drivers over the age of 25 will have generally lower rates from each of these companies.

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