Cheapest Place To Get Insurance For Young Drivers - Regional insurance companies are also an affordable option, as companies like Erie and Country Financial can offer even lower rates than State Farm.
Deciding to insure your parents' car can save you a significant amount of money—an average of 62%, according to an analysis of thousands of quotes from multiple states. Comprehensive car insurance for an 18-year-old driver with their own policy costs an average of $4,917 per year.
Cheapest Place To Get Insurance For Young Drivers
We've collected tens of thousands of quotes from every zip code in the nation's three largest states, Illinois, Pennsylvania and Georgia, to find the cheapest rates for teens and their parents. The sample of drivers included an 18-year-old, a 50-year-old with no children, and an adult with an 18-year-old on their policy.
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Factors that helped determine the best choice were low prices, discount options aimed at teenagers and the ease of getting accident forgiveness. Complete methodology
A State Farm policy for an 18-year-old costs an average of $3,518 a year, which is 29% cheaper than the national average of $4,917.
Although not an option for everyone, Country Financial, Erie and USAA are the cheapest insurance companies. Erie is only available in 12 states and Washington, D.C., while Country Financial is available in 19 states. USAA offers policies only to current and former members of the military.
Teenagers are almost always charged significantly more because they are less experienced behind the wheel and more prone to risky behavior. A teenage driver pays more than three times as much as a 50-year-old for full coverage.
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If you're a parent looking to add your teenager to the policy, Auto-Owners is the cheapest option at just $1,832 a year for a 50-year-old and 18-year-old.
That's just $501 more than without a teen on the policy, a savings of thousands of dollars. Erie, Farm Bureau and State Farm are less expensive than average options for adding a teenager to your policy.
Keeping your teen on the policy saves families an average of $3,108 a year—a 62% reduction in auto insurance costs—compared to the cost of the same 18-year-old having his own policy.
Auto Owners is often the cheapest option for parents adding a young driver, in part because the company has a flat rate for drivers under 19. It is the cheapest carrier to add 16-, 17- and 18-year-olds and the second cheapest for a 19-year-old, behind USAA.
Young Driver Car Insurance
However, other companies' rates can vary significantly, depending on the age of the young driver included in the policy. For example, it costs $1,395 less per year to add a 19-year-old to a USAA policy compared to a 16-year-old.
If you're in the position of having to buy a policy yourself as a young driver, State Farm can help keep the costs down. Among the insurance companies widely available, State Farm's average rate of $293 per month is one of the best you'll find.
You can further reduce this with discounts such as a good student discount or the Steer Clear program, which allows young drivers to reduce their prices by taking a safety course. The company, however, does not offer accident forgiveness or accident insurance, which can be key to avoiding post-accident costs.
Discounts are a key tool in reducing the high rates that teenagers pay, and Erie offers a good set of them for young drivers behind the wheel.
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Erie has some of the lowest rates we found, at $3,067 a year for a teen solo driver and $2,088 for an older driver who adds a junior to the policy. However, the company only offers coverage in 12 states.
Young drivers tend to be more careless than their older counterparts, and forgiving the car owner's accident gives the car owner a break from the first incident. The company offers the option of paying more for accident forgiveness, which means your rates won't go up after one accident.
Some companies require drivers to be longtime customers to earn the benefit. Auto-Owners also offers cheaper-than-average coverage for a lone teenager and the lowest rates we've found for adding a young driver to a parent's policy. One disadvantage is that you will have to work through an agent and cannot manage your policy online.
There are several key ways young drivers can lower their auto insurance costs and save money.
First Time Drivers Insurance
The first is to qualify for discounts, as most major insurance companies offer discounts that young drivers can take advantage of.
You can also see if your insurer offers accident forgiveness at a reasonable price. It will cost more in the short term, but young drivers are prone to accidents, and the savings will be significant if this happens.
Collision insurance is expensive for teenage drivers, as this demographic is statistically more likely to get into an accident and file an insurance claim than more experienced drivers.
It is important to remember that if a teenage driver is at fault for an accident without collision coverage, they will have to pay for the repairs themselves. Unless your car is older and valued at only a few thousand dollars, we recommend that you have collision insurance.
Young Drivers Insurance: Comparison Site For Cheap Insurance
Has curated an exclusive panel of professionals, spanning different areas of expertise, to help you break down tough topics and empower you to make smarter financial decisions.
Do you find that parents of teenage children taking on the responsibility of a major purchase, such as a car, provides a lesson worth the financial cost? Why yes or why not?
Many of the attributes that make up what it means to be responsible, such as self-control and delayed gratification, are still developing in adolescence and early adulthood. In fact, the part of the brain responsible for these processes, the prefrontal cortex, is still maturing until about age 25. They're also skills that can be practiced and honed, which means the teenage years are a great time to develop those self-control muscles, so to speak. Taking on increased responsibility and autonomy with a car can provide an adolescent with many chances to build self-control and delayed gratification skills. There is also a phenomenon called the endowment effect, where we value things more if they belong to us or we have a sense of ownership over them. So having your teen pay for their car (or at least put their own money towards it) should increase the value they place on it, leading to safer and more responsible behavior.
Some states prohibit the use of gender to determine insurance rates, even though the motor vehicle death rate for males ages 16 to 19 is nearly double that of females of the same age. How do teenage boys and girls pose different levels of risk to insurers?
Cheap Young Driver Insurance
The research is quite clear that men engage in riskier behavior than women, including wearing seat belts less often and running yellow lights more often. Women perceive a greater likelihood of negative consequences and enjoy these actions less than men, leading to less risk-taking behind the wheel. I expect these findings to play out similarly for adolescent boys and girls. However, statistical averages cannot predict the actions of any individual; Teens of all genders can be reckless and risky, and there are many teens who are extremely safe drivers.
The North Carolina Department of Transportation has the right by law to suspend the driving privileges of teenagers if they drop out of school or fail at least 70% of the courses. Should academics play an important role in getting a teen's driver's license? Why yes or why not?
Reasons for suspension of driving privileges are usually safety related (underage possession of alcohol, speeding or careless driving, etc.). In this case, unless there is a strong link between dangerous driving and poor academic performance, linking the two in terms of policy does not seem particularly effective. Academic performance is associated with other health risk behaviors (such as violence and drug use), but this is one of those cases where correlation is not the same as causation: other factors such as family stress and poverty may make teenagers more likely to perform poorly academically and engage in health risk behaviors, but skipping school is not
What is the psychological difference between learning in a classroom and learning "on the road" as a driver?
How Age Affects Car Insurance Costs
Something that emerges repeatedly in research with adolescents is the large difference in behavior between "cold" settings (unemotional, intellectual contexts such as the laboratory or classroom) and "hot" settings (emotional situations in the real world, especially with peers and social pressure). A teenager can make perfectly rational and safe decisions in the classroom (or when the driving instructor is in the car), but he takes risks on the road when he is more "stressed" by the presence of his friends.
Country Financial, a regional insurer, offered the cheapest overall rates we found for teenage drivers, while State Farm had the lowest rates for national insurers. Car owners had the lowest rates for parents with teenagers on their policies.
The teenagers with their
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