Updated: November 16, 2024
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For younger drivers, specifically those 21 and under, Nationwide tends to offer the most affordable rates. If you've just reached your early 20s but are still under 26 years old, GEICO may be the cost-effective choice. Meanwhile, Nationwide also provides competitive pricing for those who are over 25 and new to driving.
Cheapest Car Insurance For New DriversCheapest Car Insurance For New Drivers
Nationwide, GEICO and State Farm provide the most affordable rates for new drivers, depending on age.
Especially for young drivers, joining a family insurance policy can lead to more affordable rates. However, once they move out of the family home, they will typically need to secure an individual policy.
To manage insurance costs, consider driving a less expensive vehicle, utilizing insurance discounts and routinely comparing insurance quotes to guarantee consistent savings.
Why Trust MoneyGeek? Numerous variables influence car insurance rates for new drivers. To pinpoint the most precise cheapest costs for new drivers across the state, MoneyGeek compiled data from Quadrant Information Services. This was done using sample driver profiles that reflect the typical criteria insurers use to determine premiums.
These rates reflect the cheapest cost of car insurance for new drivers in 2024.
For newly licensed drivers 21 and under seeking affordability, Nationwide and GEICO stand out as the two cheapest insurance providers.
Young drivers often face high insurance premiums due to their inexperience on the road, which insurers view as an increased risk for accidents and claims. The lack of a driving record to gauge safety also contributes to higher costs.
Being added to an existing family policy is usually the best way for young drivers to find cheap car insurance. It's significantly more affordable than an individual policy and offers the convenience of a single policy for the family. It's also important to note that minors cannot legally purchase their own policy without a parent or guardian to co-sign.
| Nationwide | $2,178 | $3,730 | $1,552 |
| GEICO | $2,262 | $3,302 | $1,040 |
| State Farm | $2,419 | $2,723 | $305 |
| Allstate | $2,476 | $3,882 | $1,406 |
| Travelers | $2,539 | $3,414 | $876 |
| Progressive | $2,898 | $4,923 | $2,024 |
| Farmers | $2,913 | $5,078 | $2,165 |
Young drivers living at home can join the family's policy for more affordable insurance. Even if you head to college, you can usually remain on your parent's policy as long as your family's home is still your permanent residence.
For young drivers, particularly those 21 years old and younger, obtaining a driver's license marks the beginning of a new era of independence. However, it also introduces them to the realities of auto insurance costs.
Statistically, drivers under 21 typically face higher insurance premiums, with male drivers often paying more than their female counterparts. This cost disparity is due to the higher risk associated with younger, less experienced drivers, particularly young men, who data shows are more likely to engage in risky driving behaviors. Only six states do not allow gender as a rating factor: Michigan, California, Hawaii, Pennsylvania, North Carolina and Massachusetts.
Nationwide is one provider known to offer affordable rates to this age group, with an annual premium for a 16-year-old female added to an existing policy starting at $2,550 and an annual premium for a 16-year-old male added to an existing policy starting at $2,801.
Use the table below to filter by age and gender and find out which company offers the most affordable rates for you.
| Nationwide | $2,801 | $5,450 | $2,649 |
| GEICO | $3,040 | $5,662 | $2,621 |
| State Farm | $3,310 | $4,065 | $755 |
| Allstate | $3,426 | $6,727 | $3,301 |
| Progressive | $3,546 | $7,755 | $4,209 |
| Farmers | $3,623 | $9,070 | $5,447 |
| Travelers | $3,674 | $6,166 | $2,492 |
Your state of residence is among the rating factors insurers use to determine your premium. A young driver in one state might pay more or less than a similarly experienced young driver in another.
The state with the most affordable state is Idaho, with an average annual premium of $689 when added to existing policy, while Louisiana has the highest average premium at $3,137 per year.
By selecting the state you reside in in the table below, you can discover the various car insurance providers that offer the most competitive rates for new, young drivers to help you secure an affordable policy tailored to your unique needs and local factors.
| GEICO | $1,562 | $2,908 | $1,347 |
| Allstate | $1,604 | $2,719 | $1,115 |
| Nationwide | $1,621 | $2,835 | $1,214 |
| Travelers | $1,961 | $2,943 | $982 |
| Farmers | $2,337 | $4,876 | $2,539 |
| State Farm | $3,004 | $2,986 | $-18 |
| Auto-Owners Insurance Co | $3,050 | $2,975 | $-75 |
| Progressive | $3,375 | $6,656 | $3,280 |
As long as you live with your parents or their home is your primary residence, you can stay on their policy. But if you move out permanently, you will need to buy your own policy for your car.
For young drivers aged 25 and under, GEICO and Nationwide offer the most affordable options for car insurance:
Drivers in this age bracket typically receive better rates than younger ones because insurers take into account their increased driving experience. This age group might find individual policies more economical than being added to a family plan. The savings can be significant and are worth considering for those looking for the cheapest car insurance.
| GEICO | $1,481 | $1,518 | $-37 |
| State Farm | $1,566 | $1,638 | $-72 |
| Travelers | $1,709 | $1,622 | $88 |
| Allstate | $1,714 | $1,766 | $-52 |
| Nationwide | $1,765 | $1,482 | $282 |
| Progressive | $1,878 | $2,116 | $-238 |
| Farmers | $2,151 | $2,505 | $-353 |
Newly licensed drivers under 25 often face higher car insurance premiums due to their lack of driving experience, with young male drivers typically incurring the most expensive rates. MoneyGeek found that GEICO provides some of the most affordable car insurance options for budget-conscious young adults, but auto insurance costs for 25-year-olds vary based on many factors.
While including a young driver in a family policy can offer significant savings on car insurance, individual circumstances might lead to lower costs when opting for a separate policy. This is particularly true for drivers who qualify for specific discounts or have a driving record that varies greatly from their family.
To find the most affordable car insurance, filter the table below to display the companies offering the most competitive rates for your specific profile.
| GEICO | $1,721 | $1,729 | $-8 |
| State Farm | $1,940 | $1,983 | $-43 |
| Allstate | $1,950 | $1,959 | $-9 |
| Travelers | $1,994 | $1,796 | $197 |
| Nationwide | $2,075 | $1,630 | $445 |
| Progressive | $2,274 | $2,374 | $-100 |
| Farmers | $2,431 | $2,742 | $-311 |
Your location significantly impacts your car insurance rates due to variations in state regulations, the likelihood of accidents and other geographical factors. Currently, Maine offers the cheapest car insurance for drivers aged 21–25, with an average annual premium of $660, while Louisiana has the most expensive average premium at $2,017.
Selecting your state from the table below will reveal the insurance providers that offer the most competitive rates in your area.
| Nationwide | $1,269 | $1,184 | $85 |
| Progressive | $2,245 | $2,605 | $-360 |
| State Farm | $1,619 | $2,053 | $-434 |
| Farmers | $1,376 | $2,133 | $-758 |
| Travelers | $1,383 | $1,216 | $167 |
| Allstate | $1,136 | $1,333 | $-198 |
| GEICO | $1,271 | $1,254 | $17 |
| Auto-Owners Insurance Co | $1,701 | $2,030 | $-330 |
Nationwide and Allstate offer the most affordable insurance options for newly licensed adult drivers.
Newly licensed adult drivers often face higher average car insurance costs because insurance companies see them as higher-risk clients. Unlike experienced drivers, new licensees haven't had the opportunity to establish a driving record that demonstrates safe driving habits. Additionally, statistical data indicates that newer drivers are more likely to be involved in accidents.
| Nationwide | $2,138 | $178 |
| Allstate | $2,790 | $233 |
| State Farm | $2,977 | $248 |
| GEICO | $3,195 | $266 |
| Travelers | $3,351 | $279 |
| Progressive | $4,110 | $343 |
| Farmers | $5,412 | $451 |
MoneyGeek found that State Farm, Progressive and Farmers offer full coverage policies for drivers with international licenses:
However, if you’re only visiting the U.S. temporarily, the cheapest way to get foreign driver car insurance is to buy coverage from your car rental company.
Newly licensed adults pay, on average, $3,131 for full coverage car insurance each year.
| $3,131 | $261 |
While older first-time drivers might pay more than those with years of driving experience, they generally enjoy more favorable rates than teens. It's also worth noting that rates can fluctuate based on factors like driving history, type of vehicle, location and more.
New drivers — especially young drivers — face higher car insurance rates. If you want to manage insurance costs as a new driver, there are several tips and strategies you can employ:
Get on a family policy
Young drivers under 25 usually face higher insurance costs due to increased accident risks. To cut costs, they can join a family insurance policy. Students can also access discounts with good grades or if they're away at school without regular access to a car. Meanwhile, older new drivers, such as those in their 40s, can save with multi-car policies.
Shop around
New drivers often find better insurance deals by shopping around. Compare at least three quotes to find the most competitive rates. Regularly shopping for insurance, such as annually before your policy renewal, can also lead to savings. As drivers log more hours on the road and gain experience, maintaining a clean record can further reduce insurance costs.
Take advantage of discounts
Car insurance companies often provide the option to stack multiple discounts for which you're eligible. Among these are student discounts, good driver discounts and safety feature discounts.
For example, GEICO offers up to a 23% discount if your car is equipped with airbags. State Farm might give a discount of up to 20% if both you and a family member choose to insure with them. By taking advantage of these cumulative discounts, drivers can significantly reduce their insurance premiums.
Drive a less expensive car
Your car's value directly influences insurance premiums. Insurers charge more for pricier cars because they expect higher expenses if the car is damaged, stolen or involved in an accident. For new drivers, opting for older, less expensive vehicles, like a Toyota Camry, can be more economical than insuring a sports car.
Improve your credit score
Insurance companies often use credit-based insurance scores to set rates. However, Massachusetts, Michigan, California and Hawaii prohibit insurers from using credit factors to rate auto insurance. To maintain a strong credit score and history, always pay bills on time and avoid high credit card balances.
Learn more car insurance discounts
Here are some possible discounts that new drivers should look into when shopping around for car insurance:
Good student discount: These discounts are available at many different insurance companies, although they may vary in how they define a good student. Expect to provide proof of at least a B average.
Bundled discount: If you bundle your home/renters and auto insurance from the same company, you can often earn a 10-20% discount.
Defensive driver discount: Check with your insurance company before you choose a course, as some maintain a pre-approved list of defensive driver courses. You can usually get a 5-10% discount for taking these classes, but even if you don’t get a discount, these courses can give you the skills you need to help prevent accidents. This makes them a good investment even if you don’t get a discount.
Pay-in-full discount: If you pay your premium all at once rather than making no deposit monthly payments, you may be able to get a 5-10% discount.
Low-mileage discount: If you don’t drive very much, you may be entitled to a low-mileage discount. The qualifying mileage varies from company to company. Some companies consider driving less than 7,500 a year low mileage, and others will consider less than 10,000 miles eligible to earn a low-mileage discount.
Green/hybrid car discount: Driving a hybrid or electric vehicle can earn you a 10% discount with some insurers.
Low-mileage and safe drivers may lower their auto insurance premium with telematics/usage-based insurance. These programs monitor how often you drive, at what time you drive, your speed, whether you break hard and other details. If your driving habits are good, you may get a discount on your auto insurance premium. — Mark Friedlander, Director, Corporate Communications, Insurance Information Institute
This is a big challenge for younger drivers, who, as a group, statistically have more unfavorable driving records (according to insurance company data).
If you are younger than 25 (for whom even getting a rental car can be a challenge!), try the following things in order to lower your car insurance rates potentially:
Young drivers who are not added to a parent’s policy can still obtain lower car insurance rates by taking the following steps:
Complete a Defensive Driving Course: Many auto-insurance carriers provide discounts to young drivers who complete safe driving courses or defensive driving courses. Because young drivers are typically less experienced than other drivers, they are more at risk of causing a car accident. At-fault accidents on a teen’s driving record can substantially increase insurance premiums, especially compared to drivers in other age groups. Allstate, Geico and State Farm are some examples of insurance carriers that provide a discount upon completion of a driver safety training course.
Good Student Discount: Many car insurance companies offer discounts for full-time students who maintain good grades. Typically, insurance companies ask for a copy of the student’s report card. Allstate and State Farm are examples of companies that provide a student discount for drivers up to the age of 25.
Purchase a Used Car with High Safety Ratings: Buying a used car and the make and model of your vehicle can considerably impact your car insurance rates. A used car will save you money if you want the lowest insurance rates. The make and model of the vehicle is also important because the repair costs of different vehicles may affect your insurance premium. Car safety ratings also affect insurance premiums. Research car safety ratings by the National Highway Traffic Safety Administration to determine crashworthiness (i.e., how well a vehicle protects its occupants in a crash) and crash avoidance and mitigation (the technology that can prevent a crash or lessen its severity).
Reduce or Remove Comprehensive and Collision Coverage if the Car's Value is Low: Reducing or removing comprehensive and/or collision coverage from your policy if your vehicle is of low value is one way to lower your insurance premium. Comprehensive coverage helps pay to replace or repair your vehicle if it's stolen or damaged in an incident that's not a collision. Collision coverage helps pay to replace or repair your vehicle if it's damaged in a collision.
Increase the Deductible to Lower Your Premium: A car insurance deductible is what you pay out-of-pocket on a claim before your insurance covers the rest. By increasing your deductible, you will lower your insurance premium. Find a happy medium depending on what you can afford for out-of-pocket costs to lower your monthly premium.
Pay-Per-Mile or Usage-Based Insurance for Low-Mileage Savings: Pay-per-mile car insurance (also known as usage-based insurance) is a good option for drivers who do not drive high mileage. If you opt into a usage-based program, your insurer may track the miles you drive via a mobile app or device you plug into your car. You may be charged a daily base rate and a per-mile rate for each mile you drive. Your premium will change each month depending on the number of miles driven. Allstate, State Farm, Nationwide and Liberty Mutual are some examples of car insurance companies that offer usage-based insurance programs.
Telematics Insurance Programs: Telematics insurance uses monitoring technology to set or adjust auto insurance rates depending on your driving behavior, including speed and miles driven. Installing a telematics device in your car could net you a discount. However, your rates could also increase if the company detects poor driving habits.
Comparing car insurance quotes is one of the best ways to get started finding the best rates. Some great companies for middle-aged adults aren’t the best fit for brand-new drivers. So, doing your own quote comparison is how you can find what’s best for you.
Getting good grades will help you get a discount. So, if you have a B average or are close to it, work hard to get to and maintain a 3.0 GPA. Some young drivers can save up to 30% with a good student discount.
Consider liability-only car insurance. If you’re driving a car with a lease or loan or your car is ten years old or newer, you should carry full coverage. But if you’re driving an older car you own outright, you can save a lot of money with a liability-only policy. Remember that if you cause an accident, your insurance provider will only cover the damage you did to other parties; your car will have no coverage.
Complete a driver’s education program. Many insurance providers offer a discount to young people who complete and pass a driver’s education program that includes classroom and on-the-road training.
Ask a question, it’s free
Ask an expertMoneyGeek addresses the most common questions new drivers have about car insurance. Get guidance on finding the most cost-effective options, ensuring you find the cheapest and most suitable car insurance for your needs.
It depends on what type of new driver you are. MoneyGeek found that Nationwide is the cheapest for new drivers in their early 20s, the cheapest for new teen drivers and the cheapest for adults who are new to driving.
The cheapest for you could depend on your driving history, location and other factors, so it's best to compare multiple quotes.
Several elements play a role, including the driver's age, type of vehicle, location and more. New drivers, especially younger ones, often face higher rates due to their lack of driving experience.
Many insurance providers offer discounts for good academic performance, completion of driver's education courses or for safe driving habits. It's always a good idea to ask potential insurers about available discounts.
Generally, it's more affordable for new drivers to join a family policy. This can spread out the cost and often results in a lower combined premium than if the new driver had an individual policy.
It's a good practice to compare insurance quotes annually. As a driver gains experience and maintains a clean record, rates can decrease, and shopping around helps ensure they're getting the best deal.
Another group that typically pays more for car insurance is drivers with a gap in insurance coverage. Insurance companies consider such drivers to be a higher risk because they assume that you were driving without insurance during that time. Drivers who have a lapse in insurance and then buy a new insurance policy will pay higher rates even if they're an experienced driver.
About Gail Kellner
Gail Kellner is a finance writer at MoneyGeek, specializing in life insurance, auto insurance and personal finance. She also has a 23-year experience in the health sector.
Kellner has a Master of Science from Indiana State University and a Bachelor of Arts in Psychology from Western Connecticut State University.
