Because car insurance companies base their premiums on perceived risk, teen drivers and others newly behind the wheel see higher average car insurance rates than experienced drivers. To reduce rates over time, new drivers should maintain a clean driving record, build credit, and look out for discounts.
What is the cheapest car insurance for new drivers?
Unfortunately, there’s no single auto insurance provider, car, or discount that will give new drivers the best rates every time. However, all of these factors do play an important role in determining your auto insurance rates.
The most affordable car insurance companies for new drivers under 25
Auto insurance providers each use their own algorithms to determine their rates, meaning companies that care less about factors like age, immigration status, and zip code might offer more affordable insurance to new drivers.
New teen drivers have some of the highest rates of collisions and violations, making them extremely high-risk drivers. That’s why young drivers under 25 pay the highest average insurance rates of any age group. Drivers who fit into this category benefit from remaining on a parent’s policy for as long as possible—even college students and 18-year-olds looking for more financial freedom.1
If you need your own policy, however, here are some of the most affordable car insurance companies for people who fall into this category, along with the average rates you can expect for state minimum coverage. We’ve also included how much more that coverage costs than the national average for minimum liability coverage, which is $77 a month across all age groups.
| Insurance company | Average monthly rates (drivers under 25) | Percentage over average |
|---|---|---|
| AAA | $354 | 360% |
| Allstate | $287 | 273% |
| Founders | $265 | 244% |
| Nationwide | $287 | 273% |
| Progressive | $291 | 278% |
| State Auto | $305 | 296% |
| Travelers | $245 | 218% |
How much car insurance should first-time drivers buy?
At Jerry, our expert insurance agents recommend that drivers carry at least 100/300/100 liability insurance and full coverage. That means purchasing:
- $100,000 of bodily injury liability coverage per person
- $300,000 of bodily injury liability coverage per accident
- $100,000 of property damage liability coverage
- Any other state-mandated insurance coverage (like personal injury protection (PIP), MedPay, or uninsured/underinsured motorist coverage (UM/UIM))
- Comprehensive insurance up to the actual cash value (ACV) of your vehicle
- Collision insurance up to the actual cash value (ACV) of your vehicle
- Gap insurance, if you have a financed or leased vehicle
This might seem like a lot of coverage, but it’s the best way to ensure that you’re financially protected in the event of an accident. In fact, lenders often require you to carry most of these types of coverage when leasing or financing a new car. Remember: first-time drivers are more likely to get into an accident, so more insurance coverage is better.
Finding affordable insurance for adult new drivers
Maybe you just moved out of the city into a more rural area, or maybe you just never got around to getting your license. Regardless, newly licensed adults who get a driver’s license after the age of 25 typically pay a higher insurance premium than adult drivers with more experience.
The best way to find the most affordable car insurance provider for you is by comparing rates from over 55 top providers by using the Jerry app. This will give you a clear picture of your insurance options, average rate expectations, and more.
Immigrants and foreign nationals pay higher insurance rates in the US, too. Even if you have lots of driving experience in another country, only your time as a licensed U.S. driver will count when calculating your insurance premiums.
Drivers who fit into this category might have better luck with non-standard insurance companies since these providers are more likely to work with drivers who carry foreign licenses, but these providers certainly aren’t your only option.2
Like other new drivers, immigrants and foreign nationals will benefit from comparing insurance rates via the Jerry app to better understand their options.
The best car insurance discounts for new drivers
A great base rate is one thing, but sometimes finding the best car insurance rates is a matter of choosing the right discounts. That’s why Jerry offers a discount tool that can help you sort through discount options and find areas where you qualify for savings.
Below, you’ll find some of the best car insurance discounts for new drivers.
| Discount | How to qualify | Average savings |
|---|---|---|
| Usage-based safe driver discount | Allow your insurer to track your driving habits through a telematics app or device and avoid unsafe driving behaviors like speeding and harsh braking | 10% to 40% |
| Good student discount | Earn a B average or higher as a full-time student under 25 | 8% to 25% |
| Anti-theft discount | Install an anti-theft device in your vehicle | 5% to 25% |
| Multi-policy discounts (bundling) | Purchase homeowners or renters insurance from the same company as your auto insurance | 7% to 13% |
| Driver education/defensive driving discount | Take an approved driver education or defensive driving course to promote safe driving habits | 5% to 15% |
| Online quote discount | Get a quote for car insurance online instead of by phone or in person | 4% to 11% |
| Electronic billing discount | Pay your bill using an electronic funds transfer (EFT) rather than a paper check & opt to receive policy documents electronically | 1% to 6% |
The best vehicles for new drivers
New drivers benefit from purchasing affordable, safe, and reliable vehicles with good crash test ratings and safety features.
To help avoid accidents (and the insurance hikes that come with them), consider choosing a vehicle with a great safety rating from the Insurance Institute for Highway Safety (IIHS) and the National Highway Traffic Safety Administration (NHTSA).
You may also save by choosing a car with a lower MSRP. These vehicles have cheaper car insurance premiums on average since they cost less to repair or replace after an accident. This is especially true if you carry full coverage car insurance including collision and comprehensive coverage.
To get a better idea of how your vehicle choice impacts your car insurance rates, our experts analyzed the average monthly premiums for eight models that the IIHS called the “safest vehicles for teen drivers.” Here’s what they found:
To get a better idea of how your vehicle choice impacts your car insurance rates, our experts analyzed the average monthly premiums for eight models that the IIHS called the “safest vehicles for teen drivers.” Here’s what they found:3
| Vehicle make/model | Vehicle MSRP (starting at) | Minimum liability | Full coverage |
|---|---|---|---|
| 2014 Toyota Prius | $24,2004 | $87 | $200 |
| 2022 Subaru Outback | $27,1455 | $68 | $184 |
| 2015 Honda CR-V | $23,4456 | $90 | $173 |
| 2021 Toyota Highlander | $36,3007 | $109 | $222 |
| 2017 Toyota Tacoma | $25,1508 | $84 | $194 |
| 2023 Mazda CX-5 | $26,7009 | $115 | $319 |
| 2023 Toyota RAV-4 | $28,27510 | $112 | $354 |
| 2023 Lexus NX | $38,60511 | $122 | $505 |
Pro Tip: Used cars are usually cheaper to insure than year-old vehicles due to lower repair and replacement costs.
Other ways to save on car insurance as a new driver
There are several other ways to save on your auto insurance policy, whether you’re a first-time driver or not. Some of the best ways to lower the cost of car insurance include:
- Keep your driving record clean: Good drivers see some of the cheapest rates, and your driving history can have a big impact on your car insurance quotes in the future. Things like at-fault accidents, speeding tickets, and other traffic infractions frequently committed by inexperienced drivers can all lead to higher rates.
- Consider your coverage options: State minimum insurance will always be the cheapest option, but new drivers and experienced drivers alike benefit from a full coverage policy. You can lower your deductible for better rates, but make sure you’re still able to pay it out-of-pocket in the event of an accident.
- Improve your credit: Drivers with a low credit score will pay up to 114% more for car insurance than drivers with excellent credit.12 Work to build your credit, particularly if you’re a young adult driver without much credit history.
- Shop for the best rates: Use the Jerry mobile app to make the shopping process quick and easy. Compare rates from several auto insurance companies to ensure you’re getting the best deal for the coverage you need.
Your insurance rates will go down with time and experience
As you gain more experience, auto insurance companies will start to see you as a lower risk and, therefore, offer you lower rates. The table below shows the difference in the average cost of car insurance coverage based on your age—which generally correlates to driving experience:
| Age group | Minimum liability | Full coverage |
|---|---|---|
| Under 18 | $275 | $681 |
| 18–21 | $248 | $542 |
| 22–25 | $163 | $369 |
| 26–34 | $123 | $274 |
| 35–44 | $110 | $242 |
| 45–54 | $106 | $230 |
| 55–64 | $100 | $213 |
| 65 and up | $106 | $214 |
FAQ
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What is the cheapest car insurance for an 18-year-old driver?
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What are the best ways to lower insurance premiums for new drivers?
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Who typically has the cheapest insurance?
Sources
- https://www.forbes.com/advisor/car-insurance/best-car-insurance-for-new-drivers/ ↩︎
- https://www.caranddriver.com/car-insurance/a36177259/car-insurance-for-non-us-citizens/ ↩︎
- https://www.iihs.org/ratings/safe-vehicles-for-teens ↩︎
- https://www.motortrend.com/cars/toyota/prius/2014/ ↩︎
- https://www.kbb.com/subaru/outback/2022/ ↩︎
- https://www.motortrend.com/cars/honda/cr-v/2015/ ↩︎
- https://www.caranddriver.com/toyota/highlander-2021 ↩︎
- https://www.motortrend.com/cars/toyota/tacoma/2017/ ↩︎
- https://www.kbb.com/mazda/cx-5/2023/ ↩︎
- https://www.kbb.com/toyota/rav4/2023/ ↩︎
- https://www.kbb.com/lexus/nx/2023/ ↩︎
- https://consumerfed.org/wp-content/uploads/2023/07/Official-CFA-Credit-Score_2023-FINAL-REPORT.pdf ↩︎
Liz Jenson is an insurance writer who specializes in general automotive and insurance topics. Liz’s mission is to produce informative and useful content to help car owners make smart choices when buying cars and car insurance. Since joining Jerry in 2021, Liz has written nearly 4,000 long- and short-form articles on topics including state-specific insurance recommendations, common car insurance questions, and deep dives into vehicle model details. Before they came to Jerry, Liz was a full-time student at Indiana University, Bloomington working on a double major in English and French.
Expert insurance writer and editor Amy Bobinger specializes in car repair, car maintenance, and car insurance. Amy is passionate about creating content that helps consumers navigate challenges related to car ownership and achieve financial success in areas relating to cars. Amy has over 10 years of writing and editing experience. After several years as a freelance writer, Amy spent four years as an editing fellow at WikiHow, where she co-authored over 600 articles on topics including car maintenance and home ownership. Since joining Jerry’s editorial team in 2022, Amy has edited over 2,500 articles on car insurance, state driving laws, and car repair and maintenance.
