6 Reasons Auto Insurance Costs More for Young Drivers in 2024 (Compare Rates & Discounts)
Some big reasons auto insurance costs more for young drivers are lack of driving experience and distracted driving. Farm Bureau has the cheapest car insurance for inexperienced drivers at around $231/mo. Get affordable auto insurance for new drivers and learn why insurance is so expensive for young drivers below.
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Michael Leotta
Insurance Operations Specialist
Michael earned a degree in Business Management degree with an insurance focus, which led to a successful 25-year career in insurance claims operations and support. He possesses a high-level of business acumen across multiple areas of the insurance industry. Over the course of his career, he served in multiple roles supporting claims operations including: Claims Specialist, Claims Trainer, Claim Au...
Insurance Operations Specialist
UPDATED: Jan 25, 2024
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Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Jan 25, 2024
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident auto insurance decisions. Comparison shopping should be easy. We are not affiliated with any one auto insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
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- Insurers consider young drivers high risk due to their lack of driving experience
- Reckless and distracted driving are main reasons rates are higher for young drivers
- Find cheap insurance for young drivers by comparing quotes online
Young drivers often pay the highest rates due to age and driving inexperience. The top six reasons why auto insurance costs more for young drivers are the increased risk to the insurance company.
Since young drivers are likely to be more reckless and distracted behind the wheel, insurers charge them higher rates. Car insurance for first-time drivers can double or even triple the average driver’s rates.
Cheap auto insurance for young drivers is still easy to find when you know how to shop for auto insurance discounts. To get cheaper auto insurance for drivers under 25, check out the top six reasons auto insurance costs more for young drivers here.
Reasons Why Auto Insurance Costs More for Young Drivers
Age is one of the first factors auto insurance companies consider when deciding your rates. The younger you are, the riskier you are to insure. This table shows how auto insurance rates vary by age and gender:
Auto Insurance Monthly Rates by Age & Gender
Age/Gender Average Rates
17-Year-Old Female $582
17-Year-Old Male $694
25-Year-Old Female $254
25-Year-Old Male $270
35-Year-Old Female $208
35-Year-Old Male $214
60-Year-Old Female $194
60-Year-Old Male $204
Why is auto insurance so expensive for young male drivers? Because men are involved in more fatal accidents than female drivers, this has affected the male vs. female auto insurance rates. Let’s discuss other reasons why car insurance for young drivers costs more and how you can still save money on teen auto insurance.
1. Young Drivers Are More Likely to Be in Accidents
Teens and young adults have the second-highest fatality rate among all drivers. In 2019, over 5,600 young people under the age of 25 died in car accidents, compared to 4,958 drivers between the ages of 45-54.
Insurance companies consider statistics like these and decide annual rates accordingly. Accidents will raise car insurance rates at any age, but young drivers will see the highest increases. Young drivers can get cheaper auto insurance quotes by taking a defensive driving course and keeping a clean record.
2. Young Drivers Have an Unproven Record
After age and gender, your driving record rounds out the top three factors that affect car insurance rates. Unfortunately, new drivers come with little-to-no driving history, making it impossible for insurers to judge their driving behavior.
An experienced driver with a good record can probably handle a situation like hydroplaning on a rainy road. However, an inexperienced driver is new to these experiences and may not respond appropriately.Daniel Walker Licensed Auto Insurance Agent
Young drivers are more likely to panic or overcorrect when they face an unusual circumstance on the road, raising their risk of filing a claim.
3. Teens and Young Adults Are More Likely to Be Distracted Drivers
Young drivers report that they are more likely to text, send emails, and talk on the phone while driving. According to the CDC, distracted driving is responsible for 9% of all fatal accidents involving young drivers between the ages of 15 and 20.
Distracted driving also includes talking to other passengers, reading directions, putting on makeup, and eating while driving. In 2019, distracted driving was responsible for nearly 6% of all fatal car accidents.
Due to the increased risk distracted driving presents, insurance companies increase rates for teens who are more likely to be distracted behind the wheel.
4. Young Drivers Are More Likely to Be Reckless
Teen drivers tend to be more reckless behind the wheel, causing them to be in more accidents and file more claims. The good news is this risky behavior is reduced as teens get older.
As young drivers enter their twenties, they are less likely to engage in risk-taking behavior, whether behind the wheel or not. Accordingly, insurance companies will lower rates as drivers age and maintain a clean driving record that shows they are less likely to have an accident.
5. Young Drivers Have Lower Credit Scores
Teens and drivers under the age of 25 are less likely to open a line of credit, especially if they continue to live at home or are enrolled as full-time students. Drivers with low credit scores are considered more likely to file a claim, and insurance companies consider drivers with no credit to be just as high-risk as drivers with poor credit.
Fortunately, states are starting to make it illegal to use credit scores to determine insurance rates. If you live in California, Hawaii, Maryland, or Massachusetts, your credit score will not impact your insurance quotes.
6. Young Drivers Pose a Financial Risk to Insurance Companies
Overall, young drivers pose a financial risk to car insurance companies due to their lack of experience behind the wheel. Since young drivers are more distracted, more reckless, and more likely to get into accidents, they are more likely to cost the insurance company money.
Young drivers often have to shop with high-risk auto insurance companies to find the most affordable rates. These insurers specialize in policies for drivers with poor credit, young drivers under 21, or those with too many accidents on their record.
However, you should compare insurance quotes from at least three companies before buying a high-risk policy. If you wonder, how do I ask an auto insurance company for quotes? It’s easy.
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The Cheapest Auto Insurance for Young Drivers
How much is insurance for a new driver? Teens can pay anywhere between $200 to $1,000 more per month than drivers in their early 20s. Auto insurance quotes comparison is the easiest way to find affordable driving insurance for teenagers.
This table breaks down auto insurance rates for drivers under 19 and under 25 to see where you can get the cheapest rates based on age. Each of these companies offers competitive discounts designed for young drivers who are enrolled in school or driving classes.
Auto Insurance Monthly Rates & Savings for Young Drivers
Insurance Company Teen Rates Rates for 20-25 Year Olds Safe Driver Good Student
Allstate $614 $317 15% 10%
Erie $311 $194 12% 8%
Farm Bureau $231 $125 10% 7%
Geico $479 $239 18% 12%
Progressive $772 $234 20% 15%
State Farm $577 $204 15% 10%
USAA $423 $180 17% 12%
Farm Bureau and Erie offer the cheapest auto insurance for young drivers. However, these companies are not available in every state, and you may have to shop for teen car insurance with other companies.
🚗Drivers under 25 pay up to $5k more a year for insurance than those in their 30s.😲 Do you fall in this age range? 👉Price match here: https://t.co/TSq0vDEjME. Learn ways to save on auto insurance for young drivers: https://t.co/J43PJYIyTo pic.twitter.com/CkyAQkMKeN
— AutoInsurance.org (@AutoInsurance) February 16, 2023
Fortunately, Geico and USAA offer very competitive quotes for young drivers. USAA is only available to military members and their families, but Geico is available across the country and offers some of the highest discounts for students and safe driving.
Read our USAA auto insurance review and Geico auto insurance review to compare.
Companies That Offer Young Driver Auto Insurance Discounts
Young drivers can take advantage of good student auto insurance discounts and safe driving discounts to lower rates. However, discounts can vary by company, and some young drivers are eligible for more discounts, including full payment and usage-based discounts.
This table shows the most common discounts for young drivers with the most popular auto insurance companies:
Discount Name Allstate American Family Farmers Geico Liberty Mutual Nationwide Progressive State Farm Travelers USAA
Adaptive Cruise Control ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
Adaptive Headlights ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
Anti-lock Brakes 10% ✓ ✓ 5% 5% 5% ✓ 5%
Anti-Theft 10% ✓ 23% 20% 25% ✓ 15%
Claim Free 35% ✓ ✓ 26% ✓ 10% ✓ 15% 23% 12%
Continuous Coverage ✓ ✓ ✓ ✓ ✓ ✓ 15% ✓
Daytime Running Lights 2% ✓ 3% 5% 5% ✓ ✓
Defensive Driver 10% 10% ✓ ✓ 10% 5% 10% 5% 10% 3%
Distant Student 35% ✓ ✓ ✓ ✓ 10% ✓ 7%
Driver's Ed 10% ✓ ✓ ✓ 10% ✓ 10% 15% 8% 3%
Driving Device/App 20% 40% ✓ ✓ 30% 40% 20% 50% 30% 5%
Early Signing 10% ✓ ✓ ✓ ✓ 8% ✓ ✓ 10% 12%
Electronic Stability Control 2% ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓
Emergency Deployment ✓ ✓ ✓ 25% ✓ ✓ ✓ ✓ ✓
Engaged Couple ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Family Legacy ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ 10%
Family Plan ✓ ✓ ✓ ✓ ✓ 25% ✓ ✓ ✓ ✓
Farm Vehicle 10% ✓ ✓ ✓ ✓ ✓ ✓ ✓
Fast 5 ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Federal Employee ✓ ✓ 12% 10% ✓ ✓ ✓ ✓
Forward Collision Warning ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓
Full Payment 10% ✓ ✓ $50 ✓ ✓ ✓ 8% ✓
Further Education ✓ ✓ 10% 15% ✓ ✓
Garaging/Storing ✓ ✓ ✓ ✓ ✓ ✓ ✓ 90%
Good Credit ✓ ✓ ✓ ✓ ✓ ✓
Good Student 20% ✓ 15% 23% 10% ✓ 25% 8% 3%
Green Vehicle 10% ✓ 5% ✓ 10% ✓ ✓ ✓ 10% ✓
Homeowner ✓ ✓ ✓ ✓ 5% ✓ 3% 5% ✓
Lane Departure Warning ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Life Insurance ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Low Mileage ✓ ✓ ✓ 30%
Loyalty ✓ ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓
Married ✓ ✓ ✓ ✓ ✓ ✓
Membership/Group ✓ ✓ ✓ 10% 7% ✓ ✓
Military ✓ ✓ 15% 4% ✓ ✓
Military Garaging ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ 15%
Multiple Drivers ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Multiple Policies 10% 29% ✓ 10% 20% 10% 12% 17% 13%
Multiple Vehicles ✓ ✓ 25% 10% 20% 10% 20% 8%
New Address ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
New Customer/New Plan ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
New Graduate ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
New Vehicle 30% ✓ ✓ 15% ✓ 40% 10% 12%
Newly Licensed ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
Newlyweds ✓ ✓ ✓ ✓ 5% ✓ ✓ ✓ ✓ ✓
Non-Smoker/Non-Drinker ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Occasional Operator ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Occupation ✓ 10% 15% ✓ ✓ ✓
On-Time Payments 5% ✓ ✓ ✓ ✓ ✓ ✓ 15% ✓
Online Shopper ✓ ✓ ✓ ✓ ✓ ✓ 7% ✓ ✓ ✓
Paperless Documents 10% ✓ ✓ ✓ 5% $50 ✓ ✓ ✓
Paperless/Auto Billing 5% ✓ ✓ ✓ $30 ✓ $20 3% 3%
Passive Restraint 30% 30% 40% 20% ✓ 40%
Recent Retirees ✓ ✓ ✓ ✓ 4% ✓ ✓ ✓ ✓ ✓
Renter ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Roadside Assistance ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Safe Driver 45% ✓ 15% ✓ 35% 31% 15% 23% 12%
Seat Belt Use ✓ ✓ ✓ 15% ✓ ✓ ✓ ✓ ✓
Senior Driver 10% ✓ ✓ ✓ ✓ ✓ ✓ ✓
Stable Residence ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Students & Alumni ✓ ✓ ✓ 10% 7% ✓ ✓ ✓
Switching Provider ✓ ✓ 10% ✓ ✓ ✓ ✓
Utility Vehicle 15% ✓ ✓ ✓ ✓ ✓ ✓ ✓
Vehicle Recovery 10% ✓ ✓ 15% 35% 25% ✓ 5%
VIN Etching ✓ ✓ ✓ ✓ 5% ✓ ✓
Volunteer ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Young Driver ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓ $75
You may also find that a local insurer in your city offers unique discounts for teen and young drivers. We recommend shopping around with at least three different companies to find the best car insurance for young drivers near you.
Read more: Auto Insurance Discounts for Farm Bureau Members
How to Get Cheaper Insurance for Young Drivers
Insurance companies take on a huge financial risk with young drivers. Therefore, your insurer’s rates will be higher to compensate for that risk. Five things you can do to lower your auto insurance rates right now are:
- Get on your parent’s policy. Adding a teen driver to car insurance is much cheaper than buying a new policy.
- Earn good grades. Maintaining a “B” average or higher can earn you between 3%-10% off your rates.
- Go to driving school. More hours behind the wheel means more experience and cheaper auto insurance rates.
- Drive an older vehicle. The cheapest car for a teenager will be from 2018 or earlier.
- Install additional safety features. Adding alarms and etching your VIN into the windshield can earn you between 5%-15% off your rates.
In our helpful guide on auto insurance discounts, you can learn how to shave 30% off your auto insurance bill.
The best thing young drivers can do to lower their insurance costs is to practice safe driving habits. Young drivers should avoid accidents and speeding tickets at all costs.
It is also worth looking into specific companies that might have discounts specifically designed for your situation. For example, Geico offers a discount for seat belt usage, while Erie auto insurance provides additional coverage to college students. Read our Erie Auto Insurance Review to learn more.
Compare quotes from various companies to see which can offer you the best rates and discounts. The best insurance for young drivers will look past your age and work with you to find a policy that fits your lifestyle and budget.
Frequently Asked Questions
Why is insurance more expensive for younger drivers?
Auto insurance costs more for young drivers due to their lack of experience, higher risk of accidents, and increased likelihood of reckless and distracted driving.
What should I do if I can’t find affordable insurance as a young driver?
If you’re having trouble finding affordable insurance as a young driver, consider getting quotes from specialized insurers who cater to high-risk drivers or working with an independent insurance agent for more options.
Can I stay on my parents’ insurance policy as a young driver?
In most cases, young drivers can stay on their parents’ insurance policy. Adding a young driver to an existing policy is usually more cost-effective than purchasing a separate policy.
How can I get cheaper insurance for young drivers?
To get cheaper insurance for young drivers:
- Get on your parents’ policy
- Maintain good grades
- Complete a defensive driving course
- Choose a safe and practical vehicle
- Bundle insurance policies
Which companies offer discounts for young driver car insurance?
Many insurance companies offer discounts for young drivers, including good student discounts, safe driver discounts, and discounts for completing driver training or defensive driving courses.
Where can I find the cheapest auto insurance for young drivers?
Farm Bureau and Erie offer affordable auto insurance for young drivers, but availability varies by location. Geico and USAA also provide competitive rates for young drivers.
What age group is the most expensive to insure?
Auto insurance for 16-year-old drivers is usually the highest of all age groups, averaging $618 for full coverage.
What is the cheapest insurance for a 21 year old?
Find the cheapest auto insurance for 21-year-olds from State Farm, Erie, and Progressive.
Does car insurance automatically go down at 25?
Yes, generally, your auto insurance rates gradually fall as you age, starting at around 25 years old.
Which gender pays more for car insurance?
Usually, men pay higher rates for auto insurance than women because they’re more likely to cause accidents.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
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Michael Leotta
Insurance Operations Specialist
Michael earned a degree in Business Management degree with an insurance focus, which led to a successful 25-year career in insurance claims operations and support. He possesses a high-level of business acumen across multiple areas of the insurance industry. Over the course of his career, he served in multiple roles supporting claims operations including: Claims Specialist, Claims Trainer, Claim Au...
Insurance Operations Specialist
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.