Nationwide offers the cheapest car insurance for new drivers at $2,138 per year, followed by Allstate at $2,790. Nationwide is also the most affordable option for drivers 21 and under and over 25, while GEICO provides competitive rates for those in their early 20s. The table below compares average premiums from major insurers.
Cheapest Car Insurance for New Drivers
Updated: March 6, 2025
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Key Takeaways
Nationwide offers the cheapest car insurance for new drivers at $2,138 per year.
Young drivers under 21 get the most affordable rates with Nationwide, averaging $2,178 per year on a family policy. GEICO provides the lowest rates for drivers 25 and under, with an annual average of $1,481 for an individual policy.
Although new drivers often face higher insurance premiums due to their lack of driving experience, joining a family policy is much cheaper than purchasing an individual policy.
Cheapest Car Insurance Companies for New Drivers
| 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 |
Cheapest Car Insurance for New Drivers by Age
MoneyGeek reviewed the most affordable options for new drivers by age:
- Cheapest Car Insurance for 16-Year-Olds
- Cheapest Car Insurance for 17-Year-Olds
- Cheapest Car Insurance for 18-Year-Olds
- Cheapest Car Insurance for 19-Year-Olds
- Cheapest Car Insurance for 20-Year-Olds
- Cheapest Car Insurance for 21-Year-Olds
- Cheapest Car Insurance for 22-Year-Olds
- Cheapest Car Insurance for 23-Year-Olds
- Cheapest Car Insurance for 24-Year-Olds
- Cheapest Car Insurance for 25-Year-Olds
Cheapest Car Insurance for New Drivers 21 and Under
Nationwide offers the cheapest car insurance for newly licensed drivers aged 21 and under, with an average cost of $2,178 per year on a family policy and $3,730 for an individual policy. Use the table below to find the most affordable car insurance for new drivers 21 and younger:
| 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 |
HOW YOU CAN SAVE BY JOINING THE FAMILY POLICY
Young drivers living at home can join the family's policy for more affordable insurance. Those in college can usually stay on their parents' policy as long as their permanent residence remains the family home.
Cheapest Car Insurance for New Drivers 21 and Under by Age and Gender
State Farm and Nationwide offer the most affordable car insurance for new drivers under 21. A 16-year-old female added to a family policy with State Farm averages $2,550 annually, while a 16-year-old male pays $2,801 with Nationwide. The table below shows the cheapest options by age and gender.
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Age:16
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Gender:Male
| 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 |
Cheapest Car Insurance for New Drivers 21 and Under by State
Hawaii has the lowest average car insurance rates for new drivers 21 and under, with State Farm offering coverage for $742 per year on a family policy. Louisiana has the highest rates, with State Farm charging $4,310. The table below shows the most competitive rates from various providers by state.
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State:Alabama
| 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 | $3,050 | $2,975 | $-75 |
| Progressive | $3,375 | $6,656 | $3,280 |
HOW LONG CAN YOU STAY ON A FAMILY POLICY?
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 must buy your own car insurance.
Cheapest Car Insurance for Drivers 25 and Under
GEICO offers the most affordable car insurance for drivers 25 and under, averaging $1,481 per year for an individual policy and $1,518 for being added to a family policy. The table below compares rates to help you choose the most cost-effective option.
| 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 |
Cheapest Car Insurance for New Drivers 25 and Under by Age and Gender
GEICO offers affordable car insurance for young adults, with an annual rate of $1,334 for 25-year-old males. Rates may vary based on other factors. Use the table below to find companies with the most competitive rates for your age and gender.
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Age:22
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Gender:Male
| 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 |
Cheapest Car Insurance for Drivers 25 and Under by State
Maine has the cheapest car insurance for drivers 25 and younger, averaging $779 per year with Concord Group. Louisiana has the highest average premium at $2,689 with State Farm. Select your state in the table below to see the most competitive rates from insurers in your area.
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State:Alabama
| Nationwide | $1,184 | $1,269 | $85 |
| Travelers | $1,216 | $1,383 | $167 |
| GEICO | $1,254 | $1,271 | $17 |
| Allstate | $1,333 | $1,136 | $-198 |
| Auto-Owners | $2,030 | $1,701 | $-330 |
| State Farm | $2,053 | $1,619 | $-434 |
| Farmers | $2,133 | $1,376 | $-758 |
| Progressive | $2,605 | $2,245 | $-360 |
WHAT IS THE CHEAPEST CAR INSURANCE FOR FOREIGN DRIVERS?
State Farm, Progressive and Farmers offer affordable annual full coverage rates for drivers with international licenses:
- State Farm: $1,114
- Progressive: $1,226
- Farmers: $1,459
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.
Cheapest Car Insurance for New Drivers: Buying Guide
Explore the sections below to find the best full coverage policy for your needs. They offer guidance on balancing coverage and cost to suit your situation.
Car Insurance Discounts for Young Drivers
Here are some possible discounts that new drivers should look into when shopping around for car insurance:
- Good student discount: It's available at many different insurance companies, although they may vary in defining a good student. Expect to provide proof of at least a B average.
- Bundled discount: Bundling your home/renters and auto insurance from the same company can often earn you a 10% to 20% discount.
- Defensive driver discount: Check with your insurance company before selecting a defensive driving course, as some have a pre-approved list. These classes often provide a 5% to 10% discount, but even without a discount, they teach valuable skills to help prevent accidents, making them a worthwhile investment.
- Pay-in-full discount: If you pay your premium all at once rather than making monthly payments, you may get a 5% to 10% discount.
- Low-mileage discount: If you drive infrequently, you may qualify for a low-mileage discount. Eligibility varies by company, with some offering discounts for driving under 7,500 miles annually, while others set the limit at 10,000 miles.
- Green/hybrid car discount: Some insurers offer a 10% discount for driving a hybrid or electric vehicle.
How to Save On Car Insurance for New Drivers
New drivers, especially young ones, typically pay higher car insurance rates. To manage these costs, consider using these tips and strategies:
- 1
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. Older new drivers, such as those in their 40s, can save with multi-car policies.
- 2
Shop around
New drivers can save on insurance by shopping around. Compare at least three quotes to find the best rates. Reviewing options annually before policy renewal can also help. Gaining experience and keeping a clean driving record may lower costs over time.
- 3
Take advantage of discounts
Car insurance companies often let you combine multiple discounts, such as student, good driver and safety feature discounts. For instance, GEICO offers up to 23% off if your car has airbags, while State Farm provides up to 20% off when you and a family member insure together. Take advantage of these discounts to significantly lower your premiums.
- 4
Drive a less expensive car
Your car’s value affects your insurance premiums. Insurers charge more for expensive cars due to higher repair or replacement costs. New drivers can save by choosing older, affordable vehicles, like a Toyota Camry, instead of a sports car.
- 5
Improve your credit score
Insurance companies often use credit-based scores to determine rates, but Massachusetts, Michigan, California, and Hawaii prohibit this practice. Paying bills on time and keeping credit card balances low can help maintain a strong credit score and history.
How Long Are You Considered a New Driver?
Most insurers classify you as a new driver for three to five years after you get your license. You’re often considered high-risk during this period, making affordable insurance harder to find. Factors like claims history, driving record and vehicle type also affect your status. Your premiums will likely decrease once you’re no longer deemed a new driver.
MONEYGEEK EXPERT TIP
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 premium. — Mark Friedlander, Director, Corporate Communications, Insurance Information Institute
Cheapest Car Insurance for New Drivers: Bottom Line
Every driver, including new car owners, must have insurance. Premiums are often higher for new drivers because insurers consider them higher risk. Providers like State Farm and GEICO offer competitive rates.
Combining discounts for safe driving, defensive driving courses or good grades can help lower costs. Maintaining a clean driving record will gradually reduce premiums over time.
Affordable Auto Insurance for New Drivers: FAQ
MoneyGeek addresses the most common questions new drivers have about car insurance.
What company offers the cheapest insurance for new drivers?
Nationwide is the cheapest for new drivers in their early 20s, new teen drivers and adults who are new to driving. The cheapest for you depends on your driving history, location and other factors, so compare multiple quotes.
What factors influence the cost of car insurance for new drivers?
Several factors influence car insurance rates, including age, vehicle type and location. New drivers, especially younger ones, typically pay more due to limited driving experience.
How can new drivers qualify for discounts on their car insurance?
Many insurance providers offer discounts for good academic performance, completion of driver's education courses or safe driving habits. Ask insurers about available discounts.
Is it more cost-effective for a new driver to join a family policy or get an individual policy?
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.
How frequently should new drivers shop around for cheaper insurance rates?
Comparing insurance quotes annually is a smart practice. As drivers gain experience and maintain a clean record, rates may decrease. Shopping around ensures they get the best deal.
What if I'm new to an insurance company but not to driving?
Drivers with a gap in insurance coverage often pay higher premiums. Insurers see them as higher risk, assuming they may have driven without coverage. Even experienced drivers face higher rates after a lapse in insurance.
How much does car insurance cost for new drivers?
Newly licensed adults pay an average of $3,131 annually for full coverage car insurance. While older first-time drivers pay more than experienced drivers, they usually get better rates than teens. Factors like driving history, vehicle type and location also affect premiums.
Does a teenager with a learner's permit need insurance?
Everyone with a permit needs car insurance to drive a car legally.
Which gender of new driver pays more on insurance premiums generally?
Drivers under 25 often face higher insurance premiums, with young males paying the most. Insurers consider younger, less experienced drivers, especially young men, higher risk due to their likelihood of risky driving. Six states — Michigan, California, Hawaii, Pennsylvania, North Carolina and Massachusetts — prohibit using gender as a rating factor.
Best and Cheapest Car Insurance for First-Time Drivers: Methodology
Data Depth and Overview
MoneyGeek analyzed 2,474,515 quotes from 607 companies across 3,523 ZIP codes to determine the cheapest car insurance premiums for new drivers.
Driver Profiles
We used an average driver profile to gather insurance rates and identify the cheapest options for new drivers. The profile includes:
- Clean driving record
- 2012 Toyota Camry LE
We modified the profile for location, age and gender to reflect specific driver characteristics.
Defining Full Coverage
Unless specifically indicated, when MoneyGeek refers to full coverage on this page, it means a policy with:
- $100,000 in bodily injury liability per person
- $300,000 in bodily injury liability per accident
- $100,000 in property damage liability per accident
- Comprehensive and collision coverage, each with a $1,000 deductible
Defining Minimum Coverage
Unless specifically indicated, when MoneyGeek refers to minimum coverage on this page, it means a policy with:
- $100,000 in bodily injury liability per person
- $300,000 in bodily injury liability per accident
- $100,000 in property damage liability per accident
- No comprehensive or collision coverage
Learn more about MoneyGeek's auto insurance methodology.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.