How to Buy Auto Insurance for a New Driver in 2024
Auto insurance for new drivers is expensive since they are more likely to be in an accident. While new teen drivers can pay around $283 a month, rates for drivers over 30 average $116 a month for coverage. More affordable insurance for young adult drivers becomes available as they gain experience.
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Michael Vereecke
Commercial Lines Coverage Specialist
Michael Vereecke is the president of Customers First Insurance Group. He has been a licensed insurance agent for over 13 years. He also carries a Commercial Lines Coverage Specialist (CLCS) Designation, providing him the expertise to spot holes in businesses’ coverage. Since 2009, he has worked with many insurance providers, giving him unique insight into the insurance market, differences i...
Commercial Lines Coverage Specialist
UPDATED: Feb 16, 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: Feb 16, 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.
On This Page
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
- Car insurance for new drivers is expensive because of the higher risk of an accident
- New drivers can save by joining an existing policy rather than buying their own
- Rates will go down as a new driver gets more experience behind the wheel
If you’re a new driver, you may be curious about finding the right car insurance. Finding the best car insurance companies for new drivers is a matter of finding the coverage you want at a price that works for you.
Unfortunately, auto insurance for high-risk drivers is usually higher than the average rates, but you may be able to discover different ways to save money on coverage.
As you search for new driver car insurance, one of the best things you can do is compare policies and prices from multiple providers. Doing so will give you peace of mind when you’re behind the wheel.
Who Needs New Driver Insurance
There is no specific subset of insurance called new driver auto insurance. Still, most new drivers fall into a particular category regarding different insurance providers. Insurance companies often consider the following individuals to be new drivers:
- Teens who recently received a driver’s license
- Adults who are driving for the first time
- Immigrants or foreign nationals who have never driven in the U.S.
- Individuals with a gap in driving or insurance coverage
Auto insurance for new drivers is often more expensive than coverage for other individuals. This is mostly because of the high risk of insuring a new driver. Company rates vary, so make sure to shop around for the cheapest auto insurance companies for high-risk drivers.
Auto Insurance for Teenagers
Most insurance companies charge the highest rates for teenage drivers. This is because of their lack of experience and because they are statistically more likely to get into an accident or cause damage than any other age group.
The best way for teenagers to find affordable auto insurance rates is if they are added to an existing policy. In most cases, this will be a parent, grandparent, or guardian’s auto insurance policy. One added benefit of this arrangement is the potential to qualify for a multi-car discount.
Some insurance companies offer additional auto insurance discounts for young drivers, such as safe driving, safety features, and a good student discount.
(Read: Best Auto Insurance for Teens and Young Drivers)
Auto Insurance for Immigrants and Foreign Nationals
Auto insurance for immigrants is different because regardless of your history of safe driving in other countries, U.S. insurance companies will still consider you a new driver if you don’t have a driving history available to access.
If you’re from another country and have moved to the United States, you will need a valid driver’s license to purchase a policy. Unfortunately, even with an international driver’s permit, you will have difficulty finding car insurance without a U.S.-issued license.
The easiest way to get a driver’s license as a foreign national or an immigrant is to go to the Department of Motor Vehicles (DMV) in your state and start the process. In most cases, you will have to take a written test and a driving test, and you will have to submit the proper paperwork.
Acquiring a driver’s license in the U.S. can take a while, and your immigration status could play a role in your driving eligibility. You can speak with a representative from DMV to learn more and see what your options are.
Once you get a driver’s license, you can assume your rates will be higher than average, but if you’re over 25 years of age, you will probably pay less for coverage than most teen drivers in your area.
Auto Insurance for People With a Coverage Gap
Buying car insurance for first-time drivers, while expensive, is relatively straightforward. But buying car insurance if you’ve allowed your insurance to lapse is an entirely different story.
Gaps in coverage indicate to insurance companies that you’re a risk. Because of this, some companies may charge you high rates, while others may be unwilling to offer coverage at all. If you find that it’s challenging to find proper coverage, you may want to consider searching for a non-standard insurance provider.
Non-standard car insurance companies offer auto insurance for first-time drivers and new drivers. Still, these companies also provide coverage to drivers with poor credit, negative driving histories, and more. So while you will still pay higher rates for coverage, you can rest easy knowing you have proper coverage and can drive legally.
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
Company Facts
Average Monthly Rate For Good Drivers
A.M. Best Rating
Complaint Level
Pros & Cons
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Why Auto Insurance Is So Expensive for New Drivers
The golden rule in the insurance industry is, the higher the risk, the more you will pay for insurance premiums. This maxim is true when purchasing any kind of insurance but is especially relevant to automobile insurance.
New drivers, especially teenagers who are still in high school or college, are considered far greater insurance risks than individuals who are older and have more driving experience.
According to experts at the Insurance Institute for Highway Safety, IIHS, drivers at age 16 are six times more likely to get into an accident than drivers are in the 30 to 59 age group.
According to the IIHS, car crashes are the single biggest killer of teenagers in America.
The IIHS website provides links to brochures, videos, and other useful information that can help prevent accidents while reducing fatalities and other serious injuries among teenage drivers.
It’s no wonder then that car insurance premiums are so much higher for younger, newer drivers.
While most insurance providers will charge significantly higher premiums for new drivers, the good news is that car insurance is readily available for new drivers and many companies will offer discounts to help ease the financial burden for newer drivers’ first few years on the road.
The Average Cost of Auto Insurance for First-Time Drivers
The most important factor when considering the average cost of auto insurance for first-time drivers is the person’s age. For example, the average price of a car insurance policy for a 16-year-old is around $3,400.
Fortunately, most drivers’ rates will drop by as much as 20% by age 25 if they maintain a good driving record.
Insurance Company | 16-Year-Old Female | 16-Year-Old Male | 18-Year-Old Female | 18-Year-Old Male |
---|---|---|---|---|
Allstate | $608 | $638 | $448 | $519 |
Farmers | $778 | $742 | $573 | $603 |
Geico | $298 | $312 | $220 | $254 |
Liberty Mutual | $716 | $778 | $528 | $633 |
Nationwide | $411 | $476 | $303 | $387 |
Progressive | $801 | $814 | $591 | $662 |
State Farm | $311 | $349 | $229 | $284 |
Travelers | $709 | $897 | $523 | $729 |
As you can see, teen and young drivers pay significantly more for car insurance.
(Read: Car Insurance for Older New Drivers)
The Best Auto Insurance for Drivers Under 25
Rates with Allstate are the cheapest among the best auto insurance companies for drivers under 25. The average rate with Allstate is just over $1,200 annually. But on average, new drivers pay around $2,750 for coverage.
For parents with young drivers, it may be cheaper to add your child to your policy instead of letting them get their own car insurance.
Insurance Company | Monthly Rates for Teen Drivers | Monthly Rates for Parents with Teen Driver |
---|---|---|
Allstate | $638 | $538 |
American Family | $509 | $180 |
Farmers | $773 | $315 |
Geico | $312 | $304 |
Liberty Mutual | $785 | $255 |
Nationwide | $476 | $259 |
Progressive | $814 | $375 |
State Farm | $349 | $218 |
Travelers | $910 | $538 |
U.S. Average | $618 | $271 |
New drivers who want a full coverage policy will likely find the most competitive rates with State Farm. The average cost for a full coverage policy is around $3,300 for people under 25.
Remember that rates will vary based on your personal circumstances, so it’s wise to get quotes from multiple companies.
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The Best Auto Insurance for New Drivers 25 and Up
The best insurance for new drivers over 25 may be with Allstate. The company offers the cheapest minimum coverage at under $400 per year, over 60% less than quotes from many other providers.
The cheapest full-coverage auto insurance policy for new drivers over 25 is with State Farm, with an annual rate of $1,398.
The Best Auto Insurance Company for New Drivers on an Existing Policy
Rates for drivers added to an existing family policy are cheaper than new driver rates found elsewhere. For example, Allstate, Geico, and State Farm all offer new driver car insurance rates that are cheaper than average when a new car and driver are added to an existing policy.
Geico charges just over $1,400 on average for a year of coverage, but the company charges over $3,200 for a full coverage policy.
Credit Scores Impact Auto Insurance Rates
Unfortunately, a low credit score can make your car insurance rates expensive. If possible, you should try to build good credit before purchasing auto insurance, as you will see a significant difference in how much you’ll pay.
Insurance Company | Poor Credit | Fair Credit | Good Credit |
---|---|---|---|
AAA | $245 | $165 | $135 |
Allstate | $296 | $197 | $166 |
American Family | $203 | $136 | $116 |
Farmers | $269 | $161 | $140 |
Geico | $148 | $100 | $82 |
Hartford | $230 | $155 | $120 |
Liberty Mutual | $355 | $226 | $177 |
Nationwide | $166 | $133 | $120 |
Progressive | $206 | $138 | $109 |
State Farm | $200 | $118 | $91 |
Travelers | $194 | $128 | $107 |
U.S. Average | $226 | $148 | $123 |
There are several states that do not permit auto insurance companies to check your credit when assigning rates, so make sure to check your local laws.
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Get Cheap Auto Insurance Rates as a New Driver
Car insurance for a new driver may be expensive, but there are a few ways you can try to lower your monthly or annual rates.
Understand the Licensing Process
Today, new licensees in every state are required to go through a series of steps before receiving their permanent adult driver’s license. Graduated licenses help ease new drivers into the flow of becoming responsible motorists.
Each state differs as to the restrictions of new licensees, but most begin with learner’s permits that require a licensed adult be present.
The next step is usually a provisional license that limits the hours that a 16 or 17-year-old may drive without adult supervision. Finally, a permanent license is issued at age 18 or 19.
This process is beneficial for both new drivers and the community at large and guarantees that new drivers have met at least the minimum training, practice, and educational requirements for licensure.
Plan Ahead
By being proactive and planning ahead, new licensees can reap big dividends when it comes to shopping for auto insurance. Most states now require some form of driver training or other educational classes for new licensees.
However, there are always additional safety courses and training classes that can lead to auto insurance discounts.
It’s critical that you talk to your children in advance about the perils of driving under the influence of drugs or alcohol. While we know that drug use is illegal and that it is illegal for teens to drink in the United States, still many young people try alcohol or experiment with drugs.
It is imperative that young drivers understand that they must never get behind the wheel of a motor vehicle if they have been drinking, taking medications, or other drugs.
Not only is a driver under the influence at risk of serious injury or death, but the financial costs alone of a single DWI or DUI traffic violation can also amount to more than $10,000!
Parents should also discuss the dangers of texting, e-mailing and talking on the phone while driving.
The Automobile Club, AAA, discusses these issues in their recent article about distracted driving.
Studies conducted in the past year clearly demonstrate that drivers who use a cell phone or other handheld electronic device while driving are four times as likely to have an accident.
There are other distractions to avoid as well, such as smoking, eating, or playing with the car radio or CD player.
Compare Quotes Online
Each car insurance company decides on a person’s insurance rates differently. Because of this, you may find that some companies are willing to offer you auto insurance premiums that are a lot cheaper than other competitors.
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Comparing multiple quotes online allows you to find the company that would work best for you based on the coverage you want and the policy’s price.
Join an Existing Policy
If you’re a teen driver, see if your parents or grandparents can add you to their policy. While their rates will go up significantly, you’ll still save a lot more than if you were to purchase a policy on your own.
Adding your teen driver to an existing auto insurance policy can have several advantages. Long-term customers are likely to be eligible for many benefits and discounts that a new driver would not be able to get on their own.
Existing policies offer discounts on clean driving records and may even be willing to forgive a minor accident or traffic citation when it comes time for renewal.
Multi-policy discounts are also available to homeowners, renters, and those who purchase life, health, disability, or other types of insurance products from the same company.
Search for Discounts
Many insurance providers offer different auto insurance discounts on coverage to help policyholders save money on their insurance rates. Some of the most common discounts for auto insurance coverage include:
- Multi-vehicle
- Multi-policy
- Defensive driver
- Good student
- Safety equipment
- Occupation
If any of the above discounts apply to you, you can speak with an insurance company to see whether you’re eligible. Some discounts help policyholders save as much as 25% on their coverage.
Buy the Right Car and Ride With Your Teen
New, younger drivers are often encouraged to show off by their peers while driving. Research shows that teen drivers lack the maturity and judgment to make appropriate decisions at the moment as they are driving.
A sports car or luxury vehicle might represent too big a temptation for a teen driver.
Not only are family minivans and sedans more economical to insure, but they are also far safer to drive and present far fewer risks on the road.
Young drivers should be encouraged to take out the family wagon and abandon thoughts of driving a fast, sporty car for their own protection and yours.
Edmonds.com recommends that parents ride with their teenagers. Younger drivers need to build confidence and feel safe behind the wheel of an automobile.
Praise your new driver for following the rules of the road and engaging in safe driving practices.
Parents can also help new drivers positively adjust their habits while learning how to drive responsibly.
Choose a Lower Level of Coverage
It’s a good idea to purchase as much auto insurance coverage as you can to help keep yourself and your vehicle protected. Still, if you cannot afford a full coverage policy, you can save money on car insurance by choosing a lower level of coverage.
Choose a Higher Deductible
You can also save money on coverage by choosing a higher deductible. Unfortunately, this would mean you’d pay more out of pocket if you were involved in an accident. But it could help you save money on your monthly or annual auto insurance premiums.
Take a Class
The Automobile Club, AAA, sponsors many such classes for its members. Community colleges, public school districts, and other agencies also provide training for newer as well as older drivers who are more experienced.
Insurance companies know that educated drivers are better drivers and cause fewer accidents.
Speaking of education, most auto insurance companies offer discounts to student drivers who maintain at least a B average in school. Students with good grades get good rates as statistics show that better students tend to be better drivers.
Better students are apt to pay more attention while behind the wheel as well as follow motor vehicle laws and regulations.
Drive Safely
The best way to save money on coverage over time is by developing a superior driving record. If insurance companies can see that you drive safely and do not get involved in accidents, you will likely save a good bit of money on car insurance.
Read more: How do auto insurance companies check driving records?
Set a Good Example
Parents of young drivers can also be proactive by setting a good example when they are driving their youngsters from place to place. It’s not enough to teach new drivers proper road etiquette and the correct way to drive.
Older drivers should avoid displaying their own bad habits in front of younger, more impressionable drivers. In all cases, drivers should act responsibly and follow the rules of the road.
Teach new drivers to learn and obey all traffic regulations.
Ignorance of the law is never an acceptable excuse for a traffic infraction. According to automotive expert Edmonds.com, parents should try to make safe driving a family project.
Best Auto Insurance for New Drivers: The Bottom Line
If you’re driving, you need car insurance. However, auto insurance for new and first-time drivers is more expensive than for other age groups and categories.
To find car insurance rates that work with your budget, you can shop online and compare quotes to see which companies might work best. Also, it’s a good idea to shop around and compare car insurance quotes at least once a year to ensure you’re not paying too much for your coverage over time.
Frequently Asked Questions
Why is it important to have auto insurance for new drivers?
Auto insurance is necessary to protect new drivers, their passengers, and their vehicles in case of accidents or damages. It’s a legal requirement in most states and provides financial security in the event of unforeseen circumstances.
What do I need to buy a new car insurance policy?
- Vehicle information: Details about the car you want to insure, including the make, model, year, vehicle identification number (VIN), and current mileage.
- Personal information: Your full name, date of birth, address, and contact information.
- Driver’s license: You’ll need a valid driver’s license or learner’s permit to purchase car insurance.
- Driving history: Information about your driving history, including any accidents, tickets, or violations you’ve had in the past.
- Insurance history: Details of your previous insurance coverage, including the name of your previous insurance company, policy number, and expiration date, if applicable.
- Desired coverage options: Decide on the type and level of coverage you want for your new car. This may include liability coverage, collision coverage, comprehensive coverage, and any additional options you may want, such as roadside assistance or rental car reimbursement.
- Deductible amount: Determine the amount of deductible you are willing to pay in the event of a claim. The deductible is the amount you must contribute out of pocket before your insurance coverage kicks in.
Why is insurance so expensive for new drivers?
New driver insurance is expensive because, statistically, new drivers are more likely to be in a crash and file a claim than experienced drivers.
What is the best insurance coverage for new drivers?
New drivers should carry full coverage policies that include liability insurance, collision insurance, and comprehensive insurance. Because first-time drivers are more likely to be involved in an accident, carrying full coverage will better protect new drivers from financial issues after an accident.
How much does car insurance cost for a 16-year-old driver?
Insurance costs for 16-year-olds can range from a few hundred dollars a year to a few thousand a year. Costs depend on whether a 16-year-old joins their parent’s policy or purchases their own insurance policy.
How much does car insurance decrease when drivers turn 25?
Twenty-five-year-olds can expect rates to drop over 10% from the previous year’s rates. Generally, rates will decrease at least a few hundred dollars from when new drivers are teenagers to when they turn 25.
What should I know about the licensing process for new drivers?
The licensing process for new drivers varies by state but usually involves obtaining a learner’s permit, provisional license, and eventually a permanent adult driver’s license. It’s important to understand the specific requirements and restrictions in your state.
Can I add a new driver to my policy if they have a learner’s permit?
Yes, most insurance companies allow you to add a driver with a learner’s permit to your policy. However, it’s best to check with your specific insurance provider for their requirements and any potential changes in premiums.
Do new drivers with good grades qualify for any discounts?
Yes, many auto insurance companies offer discounts for student drivers who maintain good grades. It’s worth inquiring with your insurance provider about any available discounts for academic achievement.
How can I save money on auto insurance for a new driver?
In addition to comparing quotes from different insurance companies, you can save money by bundling multiple insurance policies, maintaining a good driving record, and exploring discounts specific to new drivers, such as safe driving courses or telematics programs.
Are there any specific insurance considerations for new drivers who will be driving for work purposes?
If the new driver will be using their vehicle for work-related purposes, it’s important to inform your insurance company. Depending on the nature of their work, additional coverage may be required, such as commercial auto insurance.
Free Auto Insurance Comparison
Enter your ZIP code below to view companies that have cheap auto insurance rates.
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Michael Vereecke
Commercial Lines Coverage Specialist
Michael Vereecke is the president of Customers First Insurance Group. He has been a licensed insurance agent for over 13 years. He also carries a Commercial Lines Coverage Specialist (CLCS) Designation, providing him the expertise to spot holes in businesses’ coverage. Since 2009, he has worked with many insurance providers, giving him unique insight into the insurance market, differences i...
Commercial Lines Coverage 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.