Cheapest Cars to Insure for a Teenager in 2020 (New & Used)

Why is auto insurance more expensive for teens?

Auto insurance rates are higher for teens to cover the increased losses they are more likely to incur. Teens get in over 230,000 accidents each year, and car crashes are also the leading cause of death for teens. Every accident, death, and bodily injury or property claim is lost profit for the insurance company. 

(source)

Since your teenager may not have started working yet, you will likely be the one paying for all the damages.

If you’re adding a teenage driver to your auto insurance, the rates will be going up. It’s the perfect time to review your coverage and compare rates with multiple companies.

How much does insurance cost for a 17-year-old male?

The national average to insure a 17-year-old for car insurance is $5,925, which is 237% more than what adults over 30 pay.

By comparison, the national average for adults is currently $1,758 a year. Specifically, that’s for teens between ages 16-19. (source)

The good news is that insurance costs do start going down at age 19 ($4,074/year) and then down again at age 21 ($3,440).

By the time your child turns 25, they’ll still be a lot higher than what it costs parents, but still gradually improving, coming in at $2,904.

I have daughters so the good news for me is that female teens generally see an average of 12% better rates than teen boys. AND when they turn 19, they will be saving about 45% over what parents with teen boys are paying.

The reason, of course, is that statistically speaking, girls are much safer drivers than boys.

The other potentially bad news is if you live in one of the following states, which rank as the most expensive states for teenage driving insurance costs:

  • Texas (darn it, that’s where I live)
  • New York (no surprise, but if we lived in NYC we wouldn’t drive)
  • Deleware
  • Louisana
  • Michigan

Experts Tips on Arizona Auto Insurance for Teens

— CelluCar (@CelluCarBlog) May 28, 2016

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Accident Forgiveness

Accidents happen to even the best young drivers. And if one does occur, insurance rates may rise as much as 30%. If you have Nationwide’s Accident Forgiveness as part of your teen car insurance package, your rates will not increase following the first at-fault automobile accident.

What are some other ways to save money on auto insurance  for 17-year-olds?

So you’re driving a car that’s one of the cheapest cars to insure for a teenager, but your car insurance is still too expensive. What else can you do to find cheap insurance for 17-year-olds?

Want to learn how to save on auto insurance for 17-year-olds? Here are some of the strategies other 17-year-old drivers have used to save lots of money on car insurance:

  • Get Added to your Parents’ Policy: Many insurers will offer policyholders a discount for paying their 6-month insurance premium in full. Some companies offer up to 10% off.
  • Pay insurance premium in full: Many insurers will offer policyholders a discount for paying their 6-month premiums in full. Some companies offer up to 10% off.
  • Get Good Grades: Many major insurance companies offer a car insurance discount for students with good grades. Students can receive up to 5% off with proof of good grades up to age 25.
  • Take a Driver Education Course: A driver training course will make you a better, safer driver. That’s why insurance companies will give you a discount for taking a driver’s education course.
  • Leave the Car at Home While Attending School: If you’re going to college, many insurance companies will often offer a steep discount if your school is more than 100 miles away from home and you’re not taking your vehicle. Even better, there is no lapse in coverage.

These are some of the most common discounts for 17-year-old drivers. Ultimately, there are hundreds of ways to save money on car insurance as a 17-year-old driver, but to a point.

At that point, the best thing you can do is wait. As you get older, your car insurance rates will inevitably drop – especially if you maintain a safe driving record.

Best Cheap Car Insurance for Teens FAQ

No. It’s usually cheaper to keep a teen driver on a parent’s policy. There are some cases where a separate auto insurance policy can be cheaper. For example, if a parent has a sports car on the policy, and the insurance company matches the teen driver with the costliest vehicle (some do), then the combination of the car and novice teen driver could push rates sky high.

For national averages, we found the cheapest rate for a family with a teen driver from American Family, Geico, Nationwide, State Farm and USAA. Our rankings also factor in complaints and collision repair scores.

You normally need to add a teen to your insurance when they get a driver’s license. Most insurance companies will cover the teen with your policy while they have a learner’s permit. So if they spend two years learning to drive with a permit—for example, from ages 16 to 18—you can enjoy those two years before high rates kick in.] However, some companies, like USAA, request that you add the teen as soon as they get their permit. With this in mind, don’t assume your teen with a permit is covered. Instead, ask your agent when the young driver must be added (during the permit stage or when fully licensed).

Practice safe driving

One of the most reliable ways to keep insurance costs low is to avoid accidents. Learn about the risks teen drivers face and get tips for how to prevent them. Nationwide’s teen driving resource center offers practical information about teen decision making, distracted driving, the role of parents in teen driving and more.

Getting the right coverage that best fits your needs is important for saving money on your teen’s car insurance policy. Learn more about Nationwide’s auto insurance coverage types today.

Which States Are the Cheapest and Most Expensive?

As mentioned, the price for car insurance coverage for teenagers varies depending on the state. The cheapest state for annual minimum and full coverage for 16-year-old drivers is Hawaii because the state doesn’t use age when determining car insurance cost.

Other than Hawaii, North Carolina has one of the lowest average rates for a full-coverage annual policy. Those who are 17 years of age should pay a little less than $2660. In Iowa, the cheapest minimum-coverage rate averages about $930 annually.

Compare that price to the rates in Louisiana, which is the most expensive for full-coverage annual policies for 16-year-old drivers. Expect to pay more than $11,500 for a full-coverage annual policy.

A 17-year-old driver won’t pay as much as a 16-year-old, but the car insurance cost will still be pricy. A 17-year-old driver should pay about $5370 annually for full coverage and $2206 annually for minimum coverage.

These 17-year-old drivers pay the most in Louisiana, as its full-coverage rates top $9255 annually. Michigan is the most expensive for minimum coverage at a little less than $4070 annually.

An 18-year-old driver pays annually on average a little more than $4830 for full coverage, and the average annual minimum-coverage rate is $1940.

Putting Hawaii aside, North Carolina has one of the cheapest average annual full-coverage rates at $2398, while Iowa is the cheapest for minimum coverage at about $812 annually.

The cheapest teenagers to insure are 19-year-old drivers, because they usually have their license longer and have spent more time behind the wheel. For them, the average price for a full-coverage policy is about $3717 annually, while a minimum-coverage rate averages $1451 annually.

Aside from Hawaii, North Carolina is the cheapest for drivers this age. The average full-coverage annual policy is $1490, and for a minimum-coverage rate, it’s $550. The most costly for full coverage is Louisiana at $6240 annually. Michigan tops the list for a minimum-coverage policy at $2890 annually.

Tips For Finding The Cheapest Cars To Insure

Buying an inexpensive vehicle does not always lead to a lower car insurance rate, but if your reasonably priced vehicle comes with a number of safety features, it will certainly drive down your average cost. In addition to the elements mentioned in our chart above, look for vehicle features including:

  • Anti-lock brakes
  • Electronic stability control
  • Lane-drift protection
  • Adaptive cruise control
  • Seatbelt pretensioner
  • Keyless entry and ignition
  • Alarm system

If you add extra security items, such as a removable bar across your steering wheel, you may also be able to get a discount.

You also need to consider the age of your car. You’ll notice there are no model-year 2020 or 2021 vehicles on our list of the cheapest cars to insure for 17-year-olds. This is because, according to the IIHS, 83 percent of teens’ cars are bought used. 

If you purchase a new vehicle with all the bells and whistles, those high-tech parts may make the car more expensive to insure, which is something to keep in mind when choosing the right ride for your teen driver. On the flip side, if you buy a used car that ends up being expensive to repair or uses hard-to-find replacement parts, it could cost more to insure.

There are also a few features the IIHS recommends avoiding, as they can make cars less safe for new drivers – and more expensive to insure. These include:

How do you save money on auto insurance for teens?

There are ways to cut down on insurance premium policy costs. For instance, being a safe driver and using more efficient vehicles (such as Honda Civics, Toyota Priuses and Nissan Rogues) tends to cut costs, even for teen drivers, according to Giusti. There are also discounts based on how often you use your car: “Some companies offer discounts to motorists who drive less than the average number of miles per year,” says Janet Ruiz, director of strategic communication at the Insurance Information Institute.

Teens may also qualify for “good student” discounts, or discounts based on learning safe driving habits from a defensive driving course or graduated driver licensing programs.

You may also be able to save money if the younger driver on your policy isn’t using their car because they’re away at college. “If there is a young driver on your policy who is … away at college without a car you may also qualify for a lower rate,” according to Ruiz. Every insurance carrier offers different discounts depending on your coverage option and other factors, so it pays to check which ones apply to you before signing up.

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