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New drivers pay significantly more for car insurance than experienced drivers, but some companies still offer great prices and comprehensive coverage.
Best Insurance For Young People
By: Daniel Robinson, By: Daniel Robinson Author Daniel is a Guide Team writer and has written for numerous automotive news sites and marketing agencies in the US, UK. and Australia, specializing in car finance and car care. Daniel is a guide team authority on car insurance, loans, warranty options, car service and more the writer
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Edited by: Rashawn Mitchner, Edited by: Rashawn Mitchner Managing Editor Rashawn Mitchner is an editor on the Guide team with over 10 years of experience in personal finance, loans, insurance and warranties. Senior Editor
Reviewed by: Mark Friedlander, Reviewed by: Mark Friedlander Advisor Mark Friedlander is Corporate Communications at the Insurance Information Institute (Triple-Eye), a New York-based nonprofit research and education organization focused on better understanding consumers Insurance Mark Triple-Eye Handles a wide range of insurance industry media matters, serving as its national spokesperson. Her responsibilities include the association's hurricane season communications strategy and support for member businesses and media campaigns in Florida, where she is based. Insurance Information Institute
In the guide team we give you an overview of what new drivers can expect to pay for car insurance, who qualifies as a new driver and what factors shape the price of insurance. Our experts have analyzed and ranked the best auto insurance companies in the industry, and we recommend comparing providers to find the best rates.
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The Guide team is committed to providing reliable information to help you make the best possible decision about insuring your car. Because consumers trust us to provide objective and accurate information, we've developed a comprehensive rating system to create our rankings of the best car insurance companies. We've collected data from dozens of car insurance providers to rank companies on a wide range of ranking factors. After 800 hours of research, the final result was an overall rating for each provider, with insurers at the top of the list receiving the most points.
There is no specific car insurance policy for new drivers. Each state sets its own minimum car insurance requirements, and car insurance for new drivers will look similar to other driver's policies. While a lack of driving experience won't change how much insurance you need, it will affect the price.
You are expected to purchase at least your state's minimum required coverage, which usually includes auto insurance for bodily injury and property damage liability. Some states also require uninsured/underinsured motorist coverage and personal injury protection. Below are the six standard types of car insurance.
As a new driver, there are several factors that can affect the specific car insurance rate you pay, including your location, vehicle, driving record and credit history. Age and driving experience are two factors that insurers weigh heavily because they are important indicators of how likely a driver is to get into an accident.
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$6,050 per year or $504 per month. Rates for new drivers are higher, especially for teenagers and young drivers, as highlighted in the table below:
*Average rates above are individual rates for teenage and young drivers, which are among the most common groups represented for new and inexperienced drivers.
Below are the average annual costs from several popular providers for full coverage insurance for a 25-year-old with a good credit rating and a good driving record.
As the table above shows, Nationwide and Travelers tend to have the cheapest rates for new drivers on average. We found that 25-year-old drivers who qualify for nationwide coverage pay an average of $1,633 per year, or $139 per month for a full-coverage auto insurance policy.
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New drivers can pay $3,000 or more per year for car insurance, depending on the company. New drivers are more expensive to insure due to lack of driving record. Younger drivers are more likely to have accidents, which also increases car insurance rates.
Part of the reason insurance companies raise rates for younger drivers is the increased likelihood of accidents due to a lack of experience behind the wheel. According to the Centers for Disease Control and Prevention, car accidents are the second leading cause of death among teenagers in the United States. Additional reports from the Insurance Institute for Highway Safety show that nearly two out of three teenagers killed in crashes in 2020 were male.
The best way to make sure you get the lowest possible rate as a new driver is to contact multiple providers for auto insurance quotes. Car insurance companies consider many factors when providing coverage estimates. Some focus on auto policies, but many others have to deal with driver demographics and driving records.
There is no surefire way to find the best price for car insurance, but there are things you can do to get lower car insurance premiums. We recommend using the following strategies when shopping for auto insurance for new drivers.
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No two insurance companies will give you the same price. Taking the time to compare car insurance quotes will give you a basic idea of what you can expect to pay when you add one to an existing policy – or how much you could save by switching providers.
When you're deciding between two companies, it can help to read comparisons like our Allstate vs Progressive review or State Farm vs Geico review. It breaks down each company's discount offers and customer reviews side by side.
Since a bad credit score can raise your rates, building good credit before you start driving is a smart way to get cheap car insurance as a new driver.
Improving your credit may seem like a daunting task, but there are many things you can do today to improve your credit score. Here are 7 easy steps to start building your credit so you can get a lower rate on your car insurance.
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Several car insurance companies offer discounts for young drivers and students, but you can save money in other ways as well. Bundle policies like homeowners insurance with your auto coverage can lower your premiums, so check to see if your insurer offers a multi-policy discount. Here are some common discounts offered by insurance providers:
If you want to save and get a new driver on the road, adjusting your current auto policy can get you a better rate. Opting for a higher deductible usually leads to lower premiums, but it also means you pay more upfront when you file an insurance claim.
Another option is to drop coverage you don't need. If one of your cars is older and you own it, you can probably stop paying for collision insurance and comprehensive coverage. In most states, you still have to pay for liability insurance if you decide to drop the remainder of your full coverage policy.
Also known as telematics insurance, usage-based car insurance measures driving behavior and mileage and uses this data to set rates. By tying monthly bills to actual time on the road and good driving habits, usage-based insurance policies typically cost consumers less than traditional auto insurance, according to the National Association of Insurance Commissioners.
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Usage-based policies may not be available in every state. They're also not a good option if you drive often or have long commutes, and people with poor driving habits may see their rates rise.
Although teenage drivers may be the first group that comes to mind when thinking of new drivers, there are different types of drivers who get their license for the first time. Here are some examples of people who may be considered new drivers:
Since car insurance costs vary from person to person, there are tips for new drivers that are specific to each of these groups. In the sections below, we'll look at some of the specifics of getting car insurance for each group.
Starting out on your own for the first time can be exciting for a teenager, but car insurance costs are usually higher for new drivers. As mentioned, age is one of the most important factors that insurance companies consider when calculating prices.
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Generally, the best way to get cheap car insurance for young drivers is to be on their parents' policy. Auto insurance companies typically offer families several discounts to save money on insurance coverage, including:
Young drivers cannot buy their own policy unless they own their own car and have the same permanent address as their parents. Note that drivers under the age of 25 typically pay much higher rates. Add a boy
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