New drivers typically pay more for car insurance than those with multiple years of driving experience. If you’re a new driver, however, you can still save on car insurance as long as you shop around, compare your options, take advantage of discounts, and choose the right vehicle.
Let’s take a deeper dive into everything you need to know about car insurance for new drivers.
Table of contents
- Who’s considered a new driver?
- Why car insurance for new drivers is expensive
- How do insurers calculate car insurance quotes?
- Best cheap insurance companies for new drivers
- How to save on car insurance as a new driver
- What to look for in an insurance policy as a new driver
- Car insurance for new drivers FAQs
Who’s considered a new driver?
Generally, people younger than 25 — and especially teenagers — are considered new drivers. Insurance companies may also consider new drivers to be:
Immigrants and foreign nationals who just moved to the U.S.
Adults who started to drive later in life
Adults who have a long gap in their driving history or insurance coverage
Adults who have relied on public transportation and started to drive when they moved to a place that requires driving to get around
In summary, a new driver is someone who is either new to driving, new to driving in the U.S., or hasn’t driven in quite some time. Compared to other drivers, they have less experience on the road.
Learn More: How to Get Car Insurance as an Immigrant or Non-U.S. Citizen
Why car insurance for new drivers is expensive
New drivers have minimal to no experience behind the wheel. For this reason, they’re more likely to cause accidents and get into dangerous situations than drivers with years of experience under their belt. Since new drivers pose a greater risk for car insurance companies, they pay higher premiums. In addition to driving experience, insurers consider other factors like age and credit score when they calculate their rates.
How do insurers calculate car insurance quotes?
While every car insurance company calculates auto insurance quotes in their own way, most of them consider the following factors.
In general, young drivers have less experience and face higher car insurance premiums as a result. Studies show that teens, as well as those in their 20s, are more likely to be involved in an accident than middle-aged drivers with decades of experience.
Rates generally start dropping as you age but begin rising again when you enter your senior years. Still, senior drivers generally have the lowest insurance rates of any age group.
Women tend to get into fewer and less-serious accidents than men, and they tend to have fewer driving infractions, data shows. So female drivers usually pay less than male drivers. This is especially true for inexperienced drivers — men under the age of 25 typically have the highest car insurance premiums.
Learn More: Compare Car Insurance by Age and Gender
If you’re a new driver, car insurance companies won’t know how safe or risky you are behind the wheel. To combat this uncertainty, they’ll charge you higher rates than more experienced drivers with clean driving records. As you gain experience and establish a good driving record — free of serious traffic violations, like speeding tickets, at-fault accidents, and DUIs — your premiums will eventually fall.
It can take three to five years before your experience and driving record earn you lower premiums.
Type of vehicle
The type of car you drive will affect your insurance premiums. Generally, if a car is an expensive model or a model that has high theft rates, insurance companies charge higher premiums for those vehicles. And if you’re a young driver with an expensive car, you’ll pay a lot more than a peer of the same experience level who’s driving a modest vehicle.
Depending on the state you live in, your credit can affect how much you spend on car insurance. Most states allow insurance companies to consider your credit when determining car insurance rates. Credit-based insurance scores use information from your credit history to estimate how likely you may be to file a claim.
When you apply for a policy, most car insurance companies will look at your credit-based insurance score, which is a variation of your regular credit score. The higher your credit score is, the better your credit-based insurance score will be.
If you have good credit, you may lock in lower rates than a driver with poor credit because car insurers will deem you a lower risk. To improve your credit and increase your chances for more affordable premiums, pay all your bills on time, pay down debt, and keep your credit utilization low.
Note that California, Massachusetts, and Hawaii have made it illegal for car insurance companies to use credit-based insurance scores when calculating premiums for their residents. If you live in one of these states, your credit won’t be considered. Maryland and Michigan limit how insurance providers can use your score, too.
Check Out: No-Credit-Check Car Insurance
Best cheap insurance companies for new drivers
Car insurance rates for new drivers vary by auto insurance company, as well as other factors like where you live, the car you drive, your credit, and your driving experience. Here’s a look at the top cheap car insurers for new drivers. You’ll find that these rates range from $205 to $334.
|Insurance Company||Average Monthly Quote|
How to save on car insurance as a new driver
As a new driver, you can use some strategies to lower your car insurance costs. While your premiums will naturally start out higher than drivers with experience, you can still save if you use the following tips.
Compare car insurance quotes
Car insurance rates aren’t created equal. In fact, they can vary greatly by auto insurance company. That’s why it’s worth your time and effort to compare quotes online from multiple providers. Continue to shop around on a yearly basis, as rates fluctuate regularly. Just because you had the lowest premium a few years ago doesn’t mean you still do.
Look for discounts
Fortunately, many car insurance providers offer a variety of discounts that you might qualify for as a new driver. Some examples of these discounts include:
Good student discounts
Student away at school discounts
Safety equipment discounts
Before you choose a car insurance company, find out what discounts might apply to you. Most providers will let you take advantage of multiple discounts. You can usually find them clearly listed on their websites.
Read On: How to Get Good Student Car Insurance Discounts
Stay on your parents’ policy
If you live with your parents or guardians, it’ll likely be cheaper for you to get added to their policy than purchase a stand-alone policy. Just make sure you talk to your parents or guardians and determine how you’ll pay them back for your portion of the car insurance. It should be a fairly quick and straightforward process for you to get added.
Choose the right vehicle
While it may be tempting to splurge on a luxury SUV or trendy sports car, you’ll face higher premiums if you do. These types of vehicles generally cost more and can be more likely to be stolen, resulting in higher claims costs.
To lock in lower premiums, pick an older vehicle with good safety ratings. It should also have safety features like automatic airbags, as some insurance companies offer discounts for having them in your vehicle.
Car and Driver says many car insurance companies consider the Honda CR-V, Toyota Camry, Subaru Forester, Volkswagen Jetta, and Ford Taurus to be the safest cars for newer drivers. Once you prove that you’re a responsible driver, you can always treat yourself to the car of your dreams.
Get a high-deductible plan
A deductible is the amount of money you pay out of pocket before your car insurance policy kicks in and takes care of the rest.
The higher your deductible, the lower your car insurance rates will be. If you do go with a high-deductible plan, however, make sure you have enough funds saved up for unexpected car expenses.
A high-deductible plan only makes sense if you’re confident you can afford to pay more out of pocket after a car accident or other related event.
Consider pay-per-mile insurance
If you don’t drive a lot, pay-per-mile insurance is worth exploring. Pay-per-mile policies typically offer affordable coverage for drivers who drive 10,000 miles per year or less. Most of them keep track of how far you drive using a special device and charge you accordingly. If you’re a student who only drives to class and occasional social activities, for example, pay-per-mile insurance can be a good fit.
Track your driving
Since you have no proof that you’re a responsible driver, some insurance providers let you track your driving and reward you with a discount. You’ll install a special device in your car and drive it around for 30 to 90 days. As you do, insurance companies will pay attention to your daily mileage, when you drive, fast acceleration, and other factors that can affect how risky you may be behind the wheel. If they like what they see, you can save some money on your policy.
Take a defensive driving course
Not only can a state-approved defensive driving course help you become a safer driver, it might also lead to cheaper car insurance premiums. Many of these courses are available online or in person and are recommended for new drivers who would like to improve their skills on the road. Depending on the insurance company, you can land a discount if you prove you’ve completed this type of course.
At the end of the day, the best way to lock in affordable car insurance is to build safe driving habits and be careful behind the wheel. No matter how many years you’ve been driving, serious traffic violations can take a toll on your record and cause your car insurance premiums to skyrocket. Make every effort to always drive responsibly.
Depending on your lifestyle and where you live, it may be realistic for you to put off driving as a teen. If you wait a few years before you get your license, you might be able to lower your car insurance costs. Just make sure you don’t delay driving for too long, as safe driving habits are easier to develop at a younger age.
What to look for in an insurance policy as a new driver
When you shop around for auto insurance as a new driver, think about what type of coverage you need. Most states require liability policies, which cover bodily injury (injuries you cause to other drivers and passengers if you’re at fault in an accident) and property damage liability (damage to other vehicles following a crash).
But if you have a car loan or lease, you’ll probably need to invest in a full-coverage policy. Full-coverage car insurance includes liability insurance plus collision and comprehensive coverage. Collision insurance pays for damage to your vehicle after an accident, while comprehensive coverage is for damage to your car from any other cause.
Once you choose what type of car insurance you need, look for a policy with affordable rates. Ideally, it would also come with new driver discounts you’re eligible for, like good student discounts and defensive driving course discounts.
If you have homeowners insurance or renters insurance, you might want to bundle your car insurance with it to save. Don’t forget to check online rankings and reviews to make sure you choose a policy from a reputable provider.
Learn More: How Long Does an Accident Affect Your Insurance Rates?
Car insurance for new drivers FAQs
Do new drivers need car insurance?
In almost every state, all drivers, including new drivers, must purchase car insurance. States generally require liability coverage, but if your car is leased or financed, the leasing company or lender will mandate full coverage.
If you do choose liability-only car insurance, note that it may not provide all the protection you need. It may be worth the extra cost to spend a bit more on a full-coverage policy.
How much is car insurance for new drivers?
Compared to experienced drivers, new drivers typically pay more for auto insurance because they pose a greater risk on the road. But you can still find affordable rates as a new driver if you compare quotes, lock in discounts, and drive safely. On average, new drivers in the U.S. can expect to pay $514 a month for a policy.
What is the best car insurance for new drivers?
The best car insurance for new drivers comes with affordable rates from providers with a great reputation and excellent industry ratings. GEICO, Nationwide, and Travelers are a few examples of companies you might want to consider for an auto policy. Their average monthly rates for new drivers are $334, $349, and $275, respectively. Note that while you might be able to find cheaper options elsewhere, these companies offer the highest-quality coverage.
Which insurance is cheapest for new drivers?
The cheapest car insurance for new drivers can be found at Stillwater, Kemper Preferred, and MetLife. Average monthly premiums from these companies are $205, $210, and $220, respectively. Keep in mind that while other companies may offer better coverage, you might pay slightly more for their policies. Sometimes, it’s worth it to spend a bit more on car insurance that gives you greater peace of mind.
Is it cheaper for a new driver to get their own car insurance?
Due to your inexperience, auto insurance providers will consider you riskier than older drivers and charge you higher premiums to lower their risk. It’s typically cheaper for you to get added to a parent or guardian’s policy than to purchase stand-alone car insurance.
You might want to get added to your parent’s insurance if you still live with them or they own a vehicle you drive. If you do get added to their policy, understand that if you get involved in an accident, your parents’ assets can be at risk in the event of a liability claim. Therefore, it’s important to drive as safely as possible.
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Data scientists at Insurify analyzed more than 40 million real-time auto insurance rates from our partner providers across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Service's database of auto insurance rates. With these insights, Insurify is able to offer drivers insight into how companies price their car insurance premiums.
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- Liberty Mutual. "Pay less for car insurance for teens & new drivers." Accessed December 2, 2022
- Nationwide. "Pay-Per-Mile Car Insurance with SmartMiles." Accessed December 2, 2022
- American Family Insurance. "KnowYourDrive Program." Accessed December 2, 2022
- Progressive. "How to Get a Defensive Driving Discount." Accessed December 2, 2022