It doesn’t get sweeter than turning 16. Yes, there’s the party and all the fun, but for many, when they blow out the candles, they only wish for the independence that comes with car keys. Those keys let a young person test-drive adulthood. Perhaps you can’t wait to roll up to school, ride to your part-time job, or cruise with friends on the weekend. While you think about the future, one task can snap you back to reality: buying car insurance.

Because of their lack of experience, 16-year-olds pay a large bill to insure their vehicles. The average price for 16-year-olds on their own policies is just under $5,000 per year, or a little over $400 per month. That’s many hours at a minimum wage job, and what about homework, sports, and other extracurriculars?

Fortunately, rates vary by location, vehicle, and unique driver profile, so with the right strategy, you can find a premium that fits your budget. Most teens rely on their parents to cover a hefty part or all of their bills. One of the smartest ways to cut costs is to join your parents’ policy. As a minor, you need a parent to sign off when you jump on the family plan or get your own separate policy.

Whether you’re a teen or parent, read on to find the best deal. And if you’re ready to compare rates from up to 20 of the top insurers within minutes, try Insurify today.

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How does age affect car insurance rates?

Just like with voting, joining the military, or renting a vehicle, age plays a significant role in determining your car insurance rate. Insurers place teen drivers in the high-risk category along with everyone under the age of 25. From ages 16 to 18, the price goes up from $413 to $459, a $46 increase, because exiting high school and entering adulthood increases the likelihood of driving. 

After age 18, the average rate drops, and it does so every year as you get closer to the quarter-century mark. For example, when you turn 23, your bill goes to $282 per month, which is $175 less than the premium for 18-year-olds and $125 less than the premium for 16-year-olds.

Age Average Monthly Rate
16 $413
17 $423
18 $459
19 $404
20 $373
21 $328
22 $301
23 $282

Why do the youngest drivers pay so much more?

According to the CDC, drivers in the 16–19 age group are nearly three times more likely than those age 20 or older to be in a fatal crash. Insurers justify higher premiums for younger drivers by statistics, their inexperience, and the likelihood of:

  • mobile device usage while driving
  • other distracted driving (such as distractions from eating, loud music, or other passengers)
  • speeding
  • driving under the influence (DUI) of alcohol

How does gender affect car insurance rates?

Gender affects how much a teenage driver pays for car insurance unless you live in a state that has banned it as a factor, specifically California, Hawaii, Massachusetts, Montana, Pennsylvania, and North Carolina. Gender is less significant than other criteria used by insurance companies, but for teens, the difference may be stark. 

According to Insurify’s data from over 25 million quotes, 16-year-old males pay 4 to 16 percent more than female drivers, amounting to about $200 to $800 per year. It costs more for 16-year-old males because their fatal crash rate is nearly double that of 16-year-old females, as reported by the CDC. A male driver is also more likely to speed, drive recklessly, and operate a vehicle while intoxicated. As male drivers age, perhaps maturity cause the price difference to go down significantly.

How does location affect auto insurance rates?

Where you live plays an outsized role in your car insurance costs. Since each state regulates car insurance differently, the mandated lower coverage limits depend on which one you call home. States with high minimum coverage liability insurance amounts tend to have high prices, and the same is true for most no-fault states, such as Michigan or Florida

Also, a location’s population density matters because more people means more drivers on the road. Population density also affects rates within a state, so you should expect urban areas to have higher rates than suburban areas and suburban areas to be costlier than rural areas. It makes sense because less traffic and congestion equals fewer accidents.

Best Car Insurance Companies for 16-Year-Olds

Auto insurance companies offer discounts to make pricing more affordable for 16-year-olds. Shopping around to get a multitude of quotes helps drive down your price. If these insurers are in your area, consider getting a quote. They’re ranked by approximate market share and ordered from national brands to small regional carriers with aggressive rates.

Progressive

Progressive is the third-largest car insurance company in the nation and gives 16-year-olds several car insurance coverage options. Even as a high-risk driver, you can find an affordable rate, especially if you have a clean driving record. Parents recognize the name, and there are various ways to bundle other insurance coverage and potentially offset the cost of your car insurance. 

Progressive‘s discounts for 16-year-olds and their families include:

  • Teen driver discount
  • Good student discount
  • Snapshot: safe driver discount
  • Multi-car discount
  • Multi-policy discount
  • Continuous insurance discount

Farmers

Pick Farmers and its exceptional claims service to show your parents you’re hoping for the best but prepared for the worst. The company is the seventh-largest auto insurer in the U.S., but even with its large size, the insurance provider is one of few companies that lets you speak to an insurance agent face-to-face. With over 21 different auto insurance discounts, teens across all 50 states are looking at Farmers.

Here are half a dozen Farmers discounts to lower the monthly insurance premium for 16-year-olds:

  • Youthful driver discount
  • Safe driver discount
  • Good student discount
  • Shared family car discount
  • Multi-car discount
  • Multi-policy discount

Direct Auto

If your parents have already told you they’re putting you on a separate insurance policy, Direct Auto is a wise choice because they specialize in high-risk drivers. And for a generation that grew up with the internet, you’ll be happy that all your policy information is easily accessible online. Also, you may pick your down payment or monthly payment, meaning the more you hand over up front, the less you spend monthly, and vice versa.

Some of the top discounts from Direct Auto geared toward teens and their families include:

  • Safe driver discount
  • Good student discount
  • Mileage discount
  • Multi-car discount
  • Multi-policy discount

Elephant

Elephant has impressively low prices, and their discounts offer 16-year-olds savings of up to 40 percent. Parents will like the idea of diminishing deductibles when you have full coverage. If your household has multiple vehicles, you save even more with the company’s considerable multi-car discount. Besides savings, Elephant has excellent customer service that’s rated 4.5 out of 5 stars after over 3,900 reviews.

Elephant gives several discounts to teenagers and their families, including:

  • Online quote discount
  • Paperless account discount
  • Good student discount
  • Safe driver discount
  • Multi-car discount
  • Multi-policy discount

Clearcover

Clearcover is the cheap car insurance leader for 16-year-olds, beating the highest on the list by $134 per month. A tech-focused company perfect for teens, Clearcover won a 2020 Mobile Web Award and has a 4.6 and 4.7 rating on the App Store and Google Play, respectively. The insurance carrier has a 90 percent customer satisfaction score and is the only one that issues payment for a claim in as little as 13 minutes.

Clearcover builds the following discounts into its standard pricing with added savings for those in the military:  

  • Electronic documents discount
  • Safe driving discount
  • Vehicle safety features discount
  • Paying up front discount
  • Military active-duty family discount

Cheapest Car Insurance Quotes for 16-Year-Olds

Finding a reasonable car insurance quote as a 16-year-old is hard enough, but you’ll also need a parent to sign off on the price. Below, you’ll find a list of companies known for tailoring coverage and rates to teenage drivers, with average monthly insurance costs determined using proprietary Insurify data. 

Insurance Company Average Monthly Cost
Clearcover $189
Elephant $194
Plymouth Rock $195
Apparent Insurance $228
MileAuto $266
National General $295
DirectGeneral $297
First Chicago $318
Freedom National $319
MetLife $323

Still need to shop around some more? Head over to Insurify, answer some quick questions, and you can compare quotes from top companies in just a few minutes.

Best Auto Insurance Discounts for 16-Year-Olds 

It’s easy to think that insurance companies have a grudge against teens. But in truth, the prices are high only to offset the statistical risk. Insurers want to give the best deal to keep you for the long term and possibly be the place that wins the family’s business for other vehicles and the home. That’s why it’s common for insurance providers to give you heavy discounts for being a good student and taking driver education courses. 

Good Student Discount

Insurance companies see smarter drivers as safer drivers, so many offer a good student discount to those under age 25 who earn a B average (or 3.0 GPA) or higher in high school or college. Insurers advertise savings of up to 25 percent, but 5 to 10 percent savings are more common. 

Driver Education Discount

Many insurance companies give up to a 10 percent discount for completing driver education courses because those who do are less likely to get ticketed or cause an accident. Once you have your learner’s permit, you may attend a high school class or paid defensive driving course, and your insurance company will cover you without a rate change until you receive your driver’s license.

Other Discounts for 16-Year-Olds

Almost all insurers provide discounts to potential policyholders. That said, customers often miss one or two savings that they qualify for. As a brand-new licensed driver buying car insurance for the first time, make sure some of these potential price breaks are on your radar:

  • Distant student discount
  • Low-mileage discount
  • Family policy discount

Car Insurance Tips for 16-Year-Olds

Teens have high insurance costs compared to older drivers, so here are a few pointers to make them as low as possible for you and your family.

Stay on Your Parents’ Car Insurance Policy

Teens want independence, but here’s one place it might be wise to lean on your parents. Yes, your parents’ price will increase after adding you, but the amount will often be thousands less in annual premiums than what you would spend on a separate auto insurance policy. If your parents are hesitant, point out the extra savings they’ll get, such as the multi-car discount.

Buy an Older Car

Older cars cost less to replace than new cars, so your price will be less, even with full coverage. Another strategy involves buying a car that doesn’t need comprehensive coverage and collision coverage. With liability coverage only, your car’s repairs are paid out of pocket unless the other driver is at fault in an accident. You’re only covered for the property damage or bodily injury you cause in a car accident, so your bill is much lower.

Drive a Safer Car

Technology has changed dramatically since the time your parents bought their first cars. Adaptive headlights, backup cameras, and lane departure warnings, among other advanced features, make it easier for new drivers to learn the road. Safer cars require lower premiums, and you may check your potential motor vehicle‘s safety rating at the Insurance Institute for Highway Safety website.

Keep a Clean Driving Record

You may not control whether your parents let you on their plan or even your vehicle if you didn’t buy your own car, but you can always control how safely you drive. Avoid speeding, driving distracted, or getting a DUI. A ticket or accident affects your rates for three to five years and can make your price go up by 40 percent. 

Car Insurance Tips for Parents of 16-Year-Olds

Here are a few ways you can help cut the car insurance cost for your teen and keep your new driver safe on the road.

Shop Around for Teen Car Insurance

Whether you’re 16 or 60, shopping around will always be the best way to save on car insurance. Yes, start with the companies with the commercials and memorable taglines, like Allstate, GEICO, Nationwide, and State Farm, but don’t skip the regional providers that often have budget-friendly pricing and personable customer service. When big brands and smaller companies compete, customers win lower prices.

Take Advantage of Discounts

Unfortunately, 16-year-olds simply aren’t eligible for the same discounts you have access to as an experienced driver. As the primary driver, loyalty, multi-car, and multi-policy discounts all give you significant savings that are out of reach for teens on separate policies. If the insurance company allows it, combine multiple price breaks to reduce monthly costs even more. So make sure your teen gets discounts for good grades, driver education courses, and safe driving.

Pick a High-Deductible Plan

For insurance, higher deductibles mean lower monthly payments. If you or your responsible teen has an extra $1,000, $2,000, or $3,000 in savings, pick a deductible to match. You’ll want to quote at the different levels to see if the savings justify the high out-of-pocket cost, and after a year, the savings could rival the deductible.

Try Usage-Based Driving

Perfect for the tech-savvy nature of teens, pay-per-mile insurance is an innovative way to lower costs for those who drive infrequently. Insurers require teens to use a telematics device or a smartphone to check their driving habits. The companies charge a base rate, and then you pay per mile. Insurance providers like Liberty Mutual and Mile Auto claim customers save up to 40 percent with these programs.

Most Expensive States for Car Insurance for 16-Year-Olds

On average car insurance for 16-year-olds and teenagers is most expensive in the following five states:

Least Expensive States for Car Insurance for 16-Year-Olds

Sixteen-year-olds and other teens enjoy the most affordable car insurance rates in the following five states:

16-Year-Old Driver Car Insurance FAQ

How much is car insurance for a 16-year-old per month?

Car insurance prices for 16-year-old and other first-time drivers are among the most expensive rates in the industry. After over 25 million quotes, Insurify's proprietary data says the average insurance cost for 16-year-olds is $413 per month. Car insurance premiums vary based on your location, vehicle, and unique driver profile, and it's possible to beat that price with an online quote-comparison tool.

Where can I compare car insurance quotes online for free?

When there are so many insurance options, it's hard to know if you got the best rate. Insurify takes the hassle and headache out of the process by allowing you to get everything quickly and easily in one place. Just head over to the site, enter some basic information, and you'll find customized quotes from up to 20 top insurance providers in just a few minutes.

How does safe driving keep car insurance rates low for a 16-year-old?

Insurers set the rates based on driver risk. Each company has its own formula, and it uses statistics about accidents, replacement cost, and other factors. A young driver is more likely to get tickets or cause car accidents because of lack of experience. Safe driving tells insurance carriers you're less of a risk, and they'll reward you with lower prices.

Does the car you drive affect the cost of car insurance?

Yes, newer cars, even of the same make and model, cost more to replace, so they require higher premiums. Insurers also factor in the engine size, likelihood of theft, repair cost, and safety. Typically, sedans like a Honda Civic are amongst the cheapest vehicles to insure, and they fare better than SUVs, sports cars, and luxury vehicles.

At what age do insurance companies stop using age as a factor for rates?

It's always a factor, but it's much less significant once you reach age 25. You don't have to wait until you’re an older driver a decade from now to save. Safe driving, good grades, and driver education start you on the path to the low price you deserve, and you may see rates drop by the time you reach your 20s.

Conclusion: The best way to compare and save on car insurance

Like many things in life, starting well is the key to finishing well, and 16-year-olds do just that by choosing the right first insurance company. As you gain driving experience, you become a more competent and confident motorist. If you avoid tickets and accidents, it might surprise you how quickly your rates drop.

Before you cruise to the future, you’ll need to find an insurer that fits your budget. Shopping around will help you secure quotes and options from the top insurance providers in your area. Why stop at the national brands when smaller regional companies have competitive prices? A handful of quotes are helpful, but you can do far better than that with a comparison tool like Insurify.

In the past, drivers searched multiple websites, made countless phone calls, or even visited agents face-to-face, but you can skip the hassle and headache when trying Insurify. Enter some basic information, answer a few quick questions, and you’ll soon be looking at up 20 insurance quotes customized to your location, vehicle, and unique driver profile.

Whether you’re a teen or parent, compare fast, free, and finance-friendly quotes at Insurify in a matter of minutes!

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Updated June 7, 2021

Courtney Roy is a financial and technology copywriter. He creates content that makes an actionable difference in the life of his readers. In addition to years of experience across multiple industries, Courtney has insurance licenses, a real estate license, and a degree in electrical engineering. He and his wife chase their five kids in the Phoenix, Arizona sun. You can learn more at thecopyprophet.com.