Teen Drivers – Auto Insurance

Everything You Want to Know

car insurance ratesLearning to drive is something every teen looks forward to. They’re excited about having a little freedom, but parents are worried about their teen’s safety—and their car insurance rates. We’re here to help! We think driving can be fun as long as you learn the basics and act responsibly.

The cost of insuring young drivers

There are several considerations that go into the cost of insuring young drivers. The amount of driving experience, the type of license they have, and the make and model of their vehicle are three things at which insurance companies look. Typically, a longer driving history and clean record will lower rates. Most young drivers operate with a license to drive personal vehicles, but drivers with a license to operate larger vehicles such as busses and trucks with heavy towing capabilities may pay higher premiums for insurance as their vehicles and towed items may cost more to cover. Newer cars can also increase the cost of insurance because of the greater value of the vehicle compared to older models.

  • Adding to an existing policy – Parents who opt to add their young drivers onto their existing policy will see an increase in their overall insurance premium. However, it’s easier for new, inexperienced drivers to become insured this way. The young driver insurance policy cost won’t increase as much if the child is driving mom or dad’s car. If they are driving their own vehicle, the existing rate could increase by a few hundred dollars a month.
  • Opening a new policy – Opening a new car insurance policy for teens isn’t often recommended because of the high cost. Insurance companies consider these young drivers a higher risk and as such, it’s not uncommon for an auto insurance policy for teens to cost upwards of a thousand dollars per year. Many teens can’t afford these rates, even if they are working full time. It’s not impossible to find affordable car insurance for teens, especially if the vehicle being driven is older and doesn’t require comprehensive coverage.

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Encourage positive behaviors

Auto insurers offer discounts or reduced premiums to:

  • Students who maintain at least a “B” average in school
  • Teens who take a recognized driver training course
  • College students who attend school at least 100 miles away from home and don’t bring their car to campus

Frequently asked questions

Country Financial , a regional insurer, offers the cheapest overall rates we found for teen drivers, while State Farm had the lowest rates for national insurers. Auto-Owners had the lowest rates for parents with teens on their policies.

Teen drivers with their own policy pay an average of $4,917 per year. However, the increased cost of adding a teen to a parent’s plan is only $1,809 per year.

Insurers often provide discounts to teen drivers for getting good grades , taking an additional training course beyond basic driver’s education and being away at school, where you won’t be using your parents’ car much. Going on a parent’s or guardian’s policy can lower rates by more than 60%.

Average car insurance costs for young drivers by state

Location is another critical factor in determining auto insurance premiums. Every state has different insurance laws, which can impact the rates set by every auto insurance company. Additionally, the risk of getting into an accident may vary by location.

The table below illustrates the average annual full coverage premium for young adults, analyzed by state.

Average annual full coverage premium by age and state

State 20-year-old 21-year-old 22-year-old 23-year-old 24-year-old 25-year-old
Alabama $4,247 $3,103 $2,899 $2,742 $2,583 $2,189
Alaska $3,534 $2,810 $2,627 $2,457 $2,350 $2,050
Arizona $3,391 $2,750 $2,570 $2,399 $2,284 $1,953
Arkansas $4,357 $3,370 $3,092 $2,947 $2,824 $2,470
California $3,980 $3,459 $3,228 $3,064 $2,870 $2,671
Colorado $4,494 $3,411 $3,161 $3,016 $2,891 $2,443
Connecticut $4,420 $3,079 $2,769 $2,546 $2,406 $2,075
Delaware $4,352 $3,045 $2,831 $2,687 $2,568 $2,176
Florida $5,726 $4,580 $4,148 $3,955 $3,828 $3,357
Georgia $4,763 $3,589 $3,426 $3,209 $3,071 $2,562
Hawaii* $1,294 $1,272 $1,273 $1,272 $1,272 $1,272
Idaho $2,648 $2,034 $1,882 $1,795 $1,729 $1,460
Illinois $3,634 $2,807 $2,556 $2,387 $2,267 $1,913
Indiana $2,945 $2,421 $2,207 $2,129 $1,979 $1,682
Iowa $2,657 $2,150 $1,996 $1,907 $1,823 $1,550
Kansas $3,838 $2,998 $2,758 $2,675 $2,597 $2,150
Kentucky $5,444 $4,071 $3,788 $3,649 $3,479 $2,863
Louisiana $5,911 $4,847 $4,390 $4,176 $3,979 $3,426
Maine $2,372 $1,566 $1,476 $1,420 $1,366 $1,107
Maryland $4,473 $3,208 $2,966 $2,732 $2,538 $2,208
Massachusetts* $1,451 $1,451 $1,451 $1,451 $1,451 $1,451
Michigan $5,743 $4,495 $4,165 $3,825 $3,625 $3,038
Minnesota $3,333 $2,856 $2,643 $2,444 $2,329 $2,011
Mississippi $3,840 $2,959 $2,763 $2,614 $2,494 $2,144
Missouri $3,923 $2,984 $2,788 $2,670 $2,562 $2,111
Montana $4,238 $3,183 $3,001 $2,760 $2,639 $2,094
Nebraska $3,414 $2,584 $2,368 $2,262 $2,187 $1,839
Nevada $4,928 $3,903 $3,656 $3,358 $3,250 $2,836
New Hampshire $2,806 $2,199 $2,000 $1,906 $1,806 $1,512
New Jersey $4,232 $3,346 $3,045 $2,818 $2,670 $2,294
New Mexico $3,033 $2,511 $2,348 $2,243 $2,148 $1,862
New York $4,861 $3,754 $3,542 $3,354 $3,207 $2,798
North Carolina $1,653 $1,576 $1,559 $1,542 $1,512 $1,482
North Dakota $2,648 $2,158 $1,995 $1,852 $1,777 $1,576
Ohio $2,679 $2,097 $1,967 $1,832 $1,722 $1,462
Oklahoma $3,791 $3,154 $2,903 $2,739 $2,615 $2,299
Oregon $2,945 $2,395 $2,173 $2,062 $1,972 $1,721
Pennsylvania $3,806 $2,913 $2,735 $2,586 $2,437 $1,964
Rhode Island $4,238 $3,314 $3,060 $2,824 $2,707 $2,324
South Carolina $3,733 $2,661 $2,506 $2,347 $2,250 $1,921
South Dakota $3,232 $2,645 $2,522 $2,379 $2,300 $2,029
Tennessee $3,241 $2,561 $2,358 $2,201 $2,033 $1,789
Texas $4,455 $3,346 $3,126 $2,960 $2,817 $2,353
Utah $3,215 $2,416 $2,221 $2,080 $1,958 $1,651
Vermont $3,539 $2,133 $2,021 $1,911 $1,853 $1,413
Virginia $3,246 $2,409 $2,226 $2,098 $1,996 $1,770
Washington $3,034 $2,235 $2,023 $1,887 $1,794 $1,545
Washington, D.C. $3,863 $3,224 $2,989 $2,766 $2,602 $2,246
West Virginia $3,520 $2,773 $2,530 $2,370 $2,216 $1,912
Wisconsin $2,609 $2,096 $1,922 $1,813 $1,726 $1,505
Wyoming $3,035 $2,616 $2,397 $2,232 $2,142 $1,720

*Hawaii and Massachusetts prohibit using age as a rating factor

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If I add a teen to my car insurance, how does coverage work?

If you add your teen driver to your car insurance policy, they’ll benefit from the same protection that you do. All covered drivers have access to all cars listed on the policy, and the liability limits are the same for all drivers on the policy. Since teen drivers pose a greater risk of accidents, you may want to increase your liability limits on the policy, especially if your current limits aren’t covering your entire net worth. Learn more about liability coverage.

All extra coverages on the policy will also apply to your teen, including roadside assistance, , rental car reimbursement, and disappearing deductibles.

Compare the Best Car Insurance for Teens and Young Drivers

Company Average Price for 17-Year-Old Purchasing Options Discounts Other Coverage State Farm Best Overall $3,055 Online, phone, local agent 13 Home, renters, life, health, pet, disability, liability, small business Allstate Best Student Discounts $4,716 Online, phone, local agent 14 Homeowners, renters, motorcycle, marine, classic car, RV/ATV, business, life, pet, identity theft, tuition Amica Best Accident Forgiveness Policy $6,156 Online, phone, live chat 18 Home, life, condo, renters, flood, retirement, marine, motorcycle, umbrella, small business USAA Best for Military Families $2,662 Online, phone, agent 12 Motorcycle, ATV/RV, classic car, marine, aviation, renters, landlord, umbrella, flood, farm, mobile phone, life, health, business Erie Insurance Best on a Budget $2,248 Online, phone, local agent 8 Motorcycle, ATV/RV, classic car, marine, renters, flood, life, snow mobiles, golf carts, condo, mobile home, personal valuables, business

How Much Coverage Does a Teen Driver Need?

Most states require drivers to maintain a minimum amount of car insurance in order to legally operate a vehicle. Our guide to state insurance requirements can help you determine how much auto insurance a teen or young driver needs. Depending on your state, you’ll likely need personal injury or personal liability coverage, which helps pay for bodily injury and property damage you cause in the event of an accident.

Car insurance for teenagers

It can be exciting for a teen to start driving on their own for the first time, but the cost of car insurance for new drivers is typically high. As mentioned, age is one of the main factors insurance companies consider when calculating prices.

Part of the reason insurance companies hike rates for younger drivers is the increased likelihood of an accident. Car crashes are the second-highest leading cause of death for teenagers in the U.S., according to the Centers for Disease Control and Prevention. Additional reporting from the Insurance Institute for Highway Safety shows that nearly two out of every three teenagers killed in crashes in 2019 were males.

How to get cheap car insurance for new drivers

Usually, the best way for young drivers to get cheap car insurance is to stay on their parents’ policies. Car insurance companies typically offer families several discounts to save money on insurance coverage, including:

  • Safe driving discounts
  • Good student discounts (must have B average grades or higher)
  • College student and student-away-at-school discounts
  • Defensive driving course discounts

Young drivers can’t purchase their own policies unless they own their own cars and no longer have the same permanent address as their parents. Keep in mind that drivers under the age of 25 usually pay much higher rates. Adding a young driver to an insurance policy will still increase your premiums substantially, but the amount will depend on your insurance company, the vehicle and where you live.

Before getting a learners permit, make a call to your insurance professional

Your agent or rep can clearly explain the costs involved in insuring a teenage driver. The good news is, as your teenager gets older, insurance rates will drop—providing he or she has a good driving record. Therefore…

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).

Getting car insurance after moving to the U.S

Immigrants and foreign nationals can be classified as new drivers when they first enter the U.S. This is because auto insurance companies usually check domestic driving records, so you can have a clean driving record in another country and still be considered an inexperienced driver after moving to the States.

Being an immigrant can make it harder to purchase car insurance. Many car insurance companies will reject applicants who don’t have valid driver’s licenses. Depending on where you live, you may still be able to get a license if you don’t have the proper government paperwork.

According to the National Conference of State Legislatures, the District of Columbia and the 16 states below allow undocumented immigrants to obtain a driver’s licenses if they can produce items like a foreign birth certificate, valid foreign passport or proof of residency in the state.

When should I consider purchasing auto insurance for my teen?

Purchasing auto insurance for teens typically occurs after they pass a driving test and get their licenses. Before obtaining a driver’s license, young drivers with a learner’s permit should also be covered under an auto policy. Most auto policies will cover teens with a learner’s permit that are driving the car of an adult in the same household, but it’s never a bad idea to confirm coverage with your car insurance provider.

Most insurance agencies will require licensed drivers — even teens — living in the same household to be covered. Younger drivers are typically added to their parent’s policy as it’s usually more affordable. The insurance laws do vary from state to state, so it’s always a good idea to speak to your agent about young driver insurance as your child approaches driving age.

How to lower rates for teen drivers

There are several key ways that young drivers can lower the price of their auto insurance and save money.

The first is by qualifying for discounts, as most major insurers offer discounts young drivers can take advantage of.

Discount How you get it Good grades discountMaintaining good grades, usually at least a 3.0Safety course discountsTaking a defensive driving course approved by your insurerAway at school discountLetting your insurer know when a teen is at school and doesn’t have access to a carSafe driving discountAvoiding accidents and speeding tickets

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 getting into accidents, and the savings will be significant if that happens.

Another significant way to reduce costs is by omitting coverages — such as collision insurance.

Collision insurance is costly for teen drivers because this demographic is statistically more likely to get into an accident and file an insurance claim than more experienced drivers.

It’s important to remember that if a teen driver is at fault in an accident without collision coverage, they will have to pay for repairs themselves. Unless your car is older and valued at only a few thousand dollars, we recommend you maintain collision insurance.

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.

Keeping Them in the Family

GEICO makes it easy to move a teen or young driver to their own auto insurance policy. We can apply discounts they qualify for and give them the benefit of their experience on an existing policy. They’ll also continue getting the same great customer service. We’re here to help—from making a policy change, filing a claim, or even just asking us a question.

Disclaimer: GEICO invites driver’s education, law enforcement, civic and community organizations that provide education on highway and traffic safety to download a supply of our materials at no cost. For a complete list of brochures and presentations, please visit our Auto Safety Library. GEICO contracts with various membership entities and other organizations, but these entities do not underwrite the offered insurance products. Some discounts, coverages, payment plans, and features are not available in all states or all GEICO companies. Discount amount varies in some states. One group discount applicable per policy. Coverage is individual. In New York a premium reduction may be available. GEICO may not be involved in a formal relationship with each organization; however, you still may qualify for a special discount based on your membership, employment, or affiliation with these organizations.

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