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Updated June 15, 2022
A new car that’s yours and only yours is a special thing. When you buy a new car, you’ll want to focus on connecting your phone to the sound system and getting all the technology figured out—not fretting over car insurance.
This quick read will get you all the facts you need to insure your new car. If you’ve only owned used cars until now, be warned: you’re probably in for a higher auto insurance bill than before. But the stakes are higher, too. When you’re looking for a policy, make sure to compare quotes to find one that fits your needs.
Newer cars are more expensive to insure, on average, than used cars.
The average cost of car insurance for a new car is $220 per month.
Other factors, such as the driver’s credit score and address, may impact car insurance quotes.
How much does car insurance cost for new cars?
Is car insurance expensive for new cars?
Generally, newer cars are more expensive to insure than old ones. However, cheap car insurance is possible if you look in the right places. Follow this guide.
An insurance policy on your new car will cost on average $220 per month, though many factors contribute to setting your specific premiums. Your credit score, the coverage options you need, and the driver discounts you qualify for will affect your car insurance rates substantially.
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Cheapest Car Insurance Companies for New Cars
To get you started on the search for a car insurance policy for your new car, take a look at the insurance companies that offer the cheapest quotes in Insurify’s database. While these quotes are a start, the matchmaking process really gets going when you start picking up car insurance discounts specific to you.
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A legacy insurance company, Allstate offers solid policies and good car insurance rates. You can manage your insurance policy with Allstate on its highly rated mobile app, and if you also purchase homeowners or renters insurance, you can bundle and save. Allstate has just about every discount you would expect from a large insurance company.
Allstate also offers new car replacement coverage as an optional provision. If your car is totaled, you can recuperate the entire investment you made, which might be a lot more than your car is worth only a few months after you buy it; as soon as you drive off the lot, your new car can lose around 20% of its value.
An accessible and affordable insurance provider, GEICO is a good choice for any driver looking for car insurance. If you have done a driver training course, are a young driver who just got their driver’s license, and/or only need liability insurance, you’re right in GEICO’s wheelhouse, and you’ll get cheap rates and discounts.
With GEICO, good drivers get the best deals. If you have an at-fault accident on your record, you might find better rates elsewhere. But it also offers discounts for military personnel and federal employees, which is rare. So if you qualify, you could get a cheap insurance policy.
Well-rated for customer service and reliable policies, Nationwide can give you the security that your new car deserves, especially if your budget isn’t too tight. If you’re in a position to bundle with renters or home insurance, you can save up to 20%, a very generous figure for the industry.
Nationwide provides many other discounts you can expect from a big insurer, from driver training to paperless billing, and a telematics program to earn points and save for safe driving habits.
State Farm has easy-to-use rideshare coverage to add to your policy if that’s something you’re anticipating using your new car for. Other than that, its coverage isn’t quite as flexible as some other insurance providers, but rates are very good on average. If affordability is a high priority for you, State Farm is a great bet.
Because State Farm’s rates are pretty low at the outset, it doesn’t offer quite as many discounts as some other insurers. There’s one coverage addition that might interest you: roadside assistance, which you can access 24/7 from your smartphone or via a telephone number.
If you’re in a military family, you should absolutely pursue auto insurance from USAA, new car or old. Its customer satisfaction and claims process are award-winning, and auto insurance rates at USAA are quite low. The catch is that it’s only available to military personnel and their families.
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Cheapest States for Car Insurance for New Cars
Along with your credit score, driving history, and the type of coverage you decide to buy, your location is also a factor that insurance companies rely on when setting your auto insurance rates. States also have different insurance requirements: while California requires liability insurance and uninsured/underinsured motorist coverage, in New Hampshire, it’s optional.
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Steps for Getting an Insurance Policy for Your New Car
You’ve probably heard that a dealership won’t let you drive your new car off the lot without proof of insurance. That’s usually true. But maybe you don’t have an insurance policy yet. And if you do, does that mean you don’t have to get another one? It seems confusing, but it’s not that complicated. Let’s talk it through.
If you already have a car. . .
Breathe easy. You can use your current insurance information to buy a new car, with a grace period of usually 7 to 30 days to add the car to your current insurance policy. Check with your insurance agent beforehand to get the details on how the process works. Once you’ve finished the sale, you can add your new car to your policy and, if applicable, remove the old one.
If you don’t have a car. . .
Without an existing auto insurance policy, try to select an insurance company in advance and start the process of buying a policy so that when you’re ready to buy your car, you can give the vehicle identification number (VIN) and other information to the company, sign the papers online, and get driving. You can cancel and switch if you don’t like your coverage.
If you’re taking out a loan. . .
Your lender will require you to have full coverage, which (on top of property damage and bodily injury liability insurance) includes comprehensive coverage and collision coverage. These coverages protect your car from a variety of calamities, regardless of fault. If there will be a brief period when your new car is worth less than the amount you owe to your lender, consider getting gap insurance to cover the difference.
If you’re buying your new car outright. . .
You’re free to select your own car insurance coverage. Since you just made a significant investment in your new car, it’s smart to opt for a full-coverage policy. Otherwise, you’re on the hook for anything that happens to it that is your fault or isn’t covered by someone else’s insurance. If full coverage raises your rate too high, try raising your deductible.
Selecting Your Insurance Coverage
Any car insurance company will sell you a policy that meets your state car insurance requirements, which are usually a combination of liability insurance, medical payments (or personal injury protection), and underinsured/uninsured motorist coverage. You’ll probably want a full-coverage policy to stay protected, at least while your car is so new.
The Best Car Insurance Quotes for New Cars
What beats the smell of a new car? Perhaps the peace of mind you get when your car insurance is as cheap as it could possibly be. And the only way to get that is to look at a whole lot of auto insurance quotes to make sure you’re getting the best possible rate based on your coverage options.
Frequently Asked Questions
According to Insurify’s database, it costs $220 per month on average to insure a new car. That varies heavily depending on several things, such as the value of the new vehicle you just bought, whether you’re going to stick with liability coverage only or opt for additional coverage like collision insurance, what your driving record looks like, and where you live.
Safe driving and good credit are the best ways to get the best auto insurance rates. But just as important is sourcing as many insurance quotes as you can to make sure that you choose the insurance provider that meets your needs best at the lowest price you can find. It’s simple comparison-shopping.
Insurify is the best place to compare car insurance rates from the most important companies in your area. It’s totally free, we don’t sell your data, and in only a few minutes, you’ll have a solid list of insurance quotes to compare to one another. You’ll save hours of time that you would have to spend getting quotes one by one, and you won’t miss the best deal.
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Data scientists at Insurify analyzed over 40 million auto insurance rates 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. With these insights, Insurify is able to offer drivers insight into how their car insurance premiums are priced by companies.