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Who is considered a New Driver?

n most circumstances, you are considered a new driver until you reach the age of 25, as teens and young adults are the most distinct groups of new drivers.

Young drivers pay an average of $1020 to $3357 a year, depending on their specific age, while those who maintain a clean driving record pay $873 at age 25. It may take several years for new drivers over the age of 25 to establish a safe driving record and lower insurance costs.

Those who earned their license later in life, immigrants who have recently migrated to the United States, or drivers with a significant gap in their driving or insurance history may pay slightly more than the $726 per year national average for minimal coverage.

However, because insurance companies rarely define a new driver, drivers of any age can still find affordable car insurance by developing good driving habits, taking advantage of available discounts, and shopping around for the best policy.

Best Car Insurance for New Drivers under 25

Car insurance costs for a 25-year-old is typically more than for someone older, although pricing can vary substantially between firms. It's not uncommon for the same driver to have several hundred dollar differences in sampling rates. Finding cheap full coverage insurance for drivers under 25 requires comparing quotes.

According to Way.com, the average full coverage policy for a 20-year-old driver is $2478 per year, while the same policy costs $1410 per year for a 25-year-old driver.

Companies like Allstate, Progressive, and Safeco offer the best car insurance for new drivers under 25. In addition, they are among the cheapest car insurance carriers for drivers of all ages, both under 25 and older.

These providers offer a wide range of coverage options at reasonable pricing and several discounts for drivers under the age of 25.

Insurance prices for drivers under 25 are often higher than for older drivers. Therefore strategies for lowering those high costs are especially significant. In addition, new drivers under the age of 25 should think about their state's car insurance regulations and the coverage they'll need to be properly protected on the road while shopping for car insurance.

After that, they should look into possible discounts.

Many major insurance companies offer discounts to young drivers that might help them save money on their premiums. For example, companies such as Allstate provide substantial student discounts to drivers under 25 who maintain a B grade-point average. In addition, young drivers who complete a driver's education or defensive driving course can also save money.

Finally, some firms, such as Metromile and Esurance, provide usage-based auto insurance, calculating premiums depending on how much you drive. These policies may be an affordable option for young drivers who do not drive frequently.

Company Minimum coverage Full coverage
Allstate $1215 $4503
Esurance $1287 $3318
Mercury $1305 $3555
Metromile $1329 $8304
Liberty Mutual $1410 $9567
Progressive $1587 $4566
State Farm $1557 $3678
USAA $1398 $3786
Safeco $2472 $5439
Travelers $3219 $7299
Nationwide $3372 $8199
Farmers $4506 $9678

See what you could save on auto insurance

Best Car Insurance for New Drivers over 25

Erie Insurance, American Family Insurance, and State Farm are the best car insurance carriers for first-time drivers over 25. When shopping for car insurance, first-time drivers over 25 should look for the best value for their money, but they should also expect to spend more than other drivers their age.

Although new teen drivers pay the most for car insurance, lack of experience at any age makes you a high-risk driver who will pay a higher premium.

Car Insurance Company
Erie Insurance
American Family Insurance
State Farm
Progressive
Allstate
Nationwide
Liberty Mutual
USAA
Farmers

For example, Erie Insurance and American Family Insurance only operate in 12 and 17 states, respectively, while the majority of these businesses operate nationwide. Furthermore, USAA is only open to military personnel and their families.

Time is the finest tool for new drivers over 25 who wish to save money on their car insurance, regardless of which insurance provider they choose. After three years of safe driving, your premium will start to decline, and after nine years of driving, your premium will drop the most.

Aside from your driving record, your age will help you save money in the long run. As drivers get older, their insurance prices decline until they achieve senior status.

Car Insurance Company Minimum Coverage Full Coverage
Erie Insurance $720 $1509
American Family Insurance $819 $1710
State Farm $603 $1410
Progressive $981 $1989
Allstate $411 $1578
Nationwide $1719 $3972
Liberty Mutual $1122 $3279
USAA $729 $1908
Farmers $1209 $3618

Best Car Insurance for New Drivers on a Family Policy

By sharing a policy with their parents or an older relative, young first-time drivers can achieve much better rates.

Allstate and State Farm have lower rates than the national average. To add another car and driver to a current policy, Although adding a second car and driver costs more, State Farm's overall rates are lower than its competitors.

The rates were estimated using a first-time driver and two parents sharing three-car full-coverage insurance. Adding a car and driver to existing full-coverage insurance is three to five times less expensive than buying a separate policy

Company Parents only With 16-year-old With 18-year-old With 21-year-old
State Farm $1044 $3150 $2655 $1998
Allstate $1527 $3486 $3489 $2295
Nationwide $1938 $4449 $4407 $3297
Farmers $2409 $5028 $4770 $5535
USAA* $1098 $3438 $3189 $2520

Best Insurance Company for New Drivers

First-time drivers must compare car insurance rates to obtain the best deal, but it's also critical to choose an insurance company with a good reputation.

Because of its better ranking from our internal team of analysts, State Farm is our recommendation for the best car insurance company for new drivers.

Our analyst's evaluation is based on comparing each company's rates to its competitors, insurance coverages offered, and customer satisfaction ratings.

Company
State Farm
Nationwide
Farmers
Allstate
USAA

How much is Insurance for a New Driver?

New drivers should anticipate spending $1596 for minimal coverage and $3879 for full coverage per year. On the other hand, car insurance premiums vary dramatically based on your age, where you reside, and other criteria like your credit score.

What influences the Price of Car Insurance?

State coverage requirements, age, and the brand and model of the car are the most important elements that influence car insurance premiums.

The more coverage your state requires and the more valuable your car is, the more your auto insurance will cost. Teen drivers' insurance costs are also higher than older drivers, more experienced drivers.

Age:

The age of a new driver can affect car insurance quotes by up to 372%. Young drivers pay a higher premium for auto insurance since they are considered inexperienced and more likely to cause an accident. After the age of 25, a driver's insurance prices begin to fall.

On the other hand, senior drivers are frequently charged more after they reach the age of 65. As a result, older drivers are more likely than younger drivers to be involved in a car accident, but they are also more likely to be harmed in one.

Gender:

In some states, gender might have an impact on car insurance premiums. Teenage male drivers pay the most on auto insurance. For drivers in their 30s, the gender divide narrows.

Marital status:

Your marital status is essential for car insurance costs because married drivers are statistically the safest drivers to cover, with up to 50% fewer accidents than all other drivers. So if you get married, notify your auto insurance company so that your wallet will benefit from the positive statistics.

Location:

Insurance companies consider your location because it influences the risk of your car being damaged. In California, for example, your zip code might affect your insurance prices by up to 93%.

Depending on where you work and park your car at night, you might get a slight discount (or upcharge) for your street address. Large cities have greater crime rates and congested roadways with frequent accidents. Rural roadways are less congested, and property crime is lower in rural regions.

3Ms - Make, Model, and Mileage:

Some cars are less expensive to insure than others. Car insurers prefer to insure safe cars since they are less likely to result in costly claims.

As a result, a car with high safety ratings may qualify for a discount. However, some cars, such as the Honda Accord and any full-size Ford pickup, are statistically more likely to be stolen. As a result, they are more expensive to insure.

Your annual mileage might affect your auto insurance rates since the more time you spend on the road, the more likely you will be involved in an accident. As a result, if you have a long daily drive, auto insurance companies will charge you extra. On the other hand, you will likely pay less if you solely drive for pleasure.

Credit score:

Your credit history is a significant element in determining premiums in most jurisdictions, as drivers with a negative credit score pay 71% more than drivers with good credit. If you live in California, Massachusetts, or Hawaii, you're in luck: car insurance providers cannot consider your credit score.

However, in the other 47 states, you can save a little money on car insurance if you have good credit.

Driving history:

Your driving record impacts your insurance premiums, for better or worse. Because of the availability of safe-driver discounts, drivers with a clean record may pay 40% less than those with a poor record.

If you file any insurance claims, whether or not the incidents are your fault, you'll likely be charged extra. Even a little mishap can hike your insurance costs for the next 3-5 years. The length of time you've been on the road is also important. New drivers over the age of 25, for example, tend to pay more than their more experienced counterparts.

Coverage limits:

Your place of residency is one of the most important factors affecting car insurance costs, as state-minimum coverage premiums can vary by up to 321%. Each state has its own car insurance rules, requiring varying minimums and different types of coverage. The more coverage you must get, the more expensive your policy is.

How does Experience affect Car Insurance Rates?

When determining prices, auto insurance companies evaluate various factors, including driving experience. People with little to no driving experience are more difficult to insure, so they'll have to pay higher premiums behind the wheel in their first few years.

Your insurance prices will decrease as you spend more time behind the wheel.

Insurance companies only assess driving experience in the United States; therefore, immigrants and foreign nationals pay higher prices even with overseas driving expertise.

Driving Years Average annual premium
0 $1119
1 $897
2 $870
3 $849
4 $831
5 $789

How does Age affect Car Insurance Rates?

One of the most important elements influencing new-driver rates is age. Teens who have a higher risk tolerance than middle-aged drivers cause more accidents. Some people, though, start driving later in life.

Even if you're not a new driver, you'll pay greater rates than other people your age. You will, however, witness a smaller growth than your younger peers.

Age Minimum coverage Full coverage
16 $3,097 $7,229
17 $3,021 $7,079
18 $3,107 $7,450
21 $1,747 $4,351
25 $1,198 $2,984
35 $1,016 $2,577
45 $1,007 $2,495
55 $946 $2,310

Common Car Insurance Discounts for New Drivers

Bundling Discounts

Carrying multiple policies with one insurance provider qualifies you for a multi-policy discount. For example, home-and-auto and renters-and-auto are two popular policy combinations. Therefore, both policies are eligible for these savings.

Depending on your coverage mix, the savings you receive may differ. Bundling homeowners and car policies will save you more money than adding a renters insurance policy to your motor coverage. The reasoning is straightforward: homeowners insurance generates more income for an insurance firm than renters insurance.

Multi Car Discount

A multi-car discount is similar to a multi-policy discount in that it pertains to insuring many cars with the same insurer. The reduction is applied either at the commencement of the term - if two cars were insured from the start - or when a second vehicle is added to the policy.

Defensive Driving Course Discount

This discount requires you to complete a defensive driving course and provide proof of completion in a receipt or transcript to your insurance company. The theory behind this discount is simple: defensive driving classes make you a safer driver, making you less hazardous to insure and hence less expensive.

Anti-Theft Discount

Your insurance company may give you a discount if your car has an anti-theft device. Although the reduction isn't as large as a multi-policy or defensive driver bonus, every little bit helps. Modern cars are frequently equipped with anti-theft equipment. Just make sure that any security devices are considered while generating your quote.

Clean Driving Record Discount

You are eligible for this discount if you have a clean driving record and no at-fault accidents or tickets. When your Motor Vehicle Report (MVR) is pulled at the start of your policy, you may expect this valuable savings to be applied to your policy. If you believe you have good driving habits but aren't getting a discount, contact your insurance carrier and ask about a good driver discount.

Profession Discount

This discount has numerous names, but the concept is the same. Your occupation may qualify you for a discount from some insurance companies. Teachers, physicians, and police officers, for example, are statistically less likely to file a claim. An insurer will almost always want proof of profession, such as a photocopy of your diploma.

Discount for Good Student

If you're under 25 and have good grades - often a B average (3.0 GPA) or higher - inquire about a good student discount with your insurance company. They'll usually request a transcript every six to twelve months to confirm your good standing.

Car Insurance for Immigrants and Foreign Nationals

If you drive a car in the United States, you must have car insurance even if you are not a resident. However, the best auto insurance for foreign drivers is determined by the time you intend to stay in the nation.

Rental car insurance is available straight from the rental firm for short-term travelers to the United States. However, long-term foreign drivers should obtain or bring a car insurance policy from a United States company. In addition, if you're staying for a few months, several states may require you to obtain a US driver's license.

Car Insurance for Foreigners for a Short Visit

People visiting the United States for a short period, such as on vacation, are unlikely to need to purchase car insurance from a separate insurer. The most straightforward approach is to obtain temporary insurance directly from the car rental business. This coverage is similar to liability insurance, which covers any damage or injuries you cause to another driver if you're found to be at fault in an accident.

Furthermore, travelers from Canada, particularly those driving their cars, are likely to be covered by their home country's insurance while driving in the United States. Consult your insurance company and the state's legislation where you will be driving.

Car Insurance for Foreigners for a Longer Visit

Progressive offers online car insurance prices as little as $78 per month. That's only $2 more per month than a citizen of the United States would pay.

If you're going to be in the United States for a few months and want to buy or lease a car, you'll need to get your insurance. In most states, auto insurance must register and drive a car. Unfortunately, getting car insurance for international tourists is not always easy or inexpensive.

By chatting with an insurance agent over the phone or in person, you may be able to obtain coverage from well-known auto insurance providers.

Car Insurance Companies for Foreigners

A few smaller auto insurance providers promote that they can cover drivers with foreign licenses. However, several of these companies, like Infinity and Gainsco, specialize in working with high-risk drivers, so their prices may be higher.

The following small insurance companies sell car insurance to international drivers:

Car Insurance Companies
Dairyland
Infinity
Kemper
Hallmark
Gainsco
Assurance

Why pay-per-mile coverage is ideal for New Drivers

Pay-per-mile insurance may be a good option for people who do not drive frequently. In addition, a pay-per-mile insurance policy maybe your best option for economic coverage if you drive less than 10,000 miles each year.

This car insurance policy is unlikely to save you any money if you drive your car regularly.

Pay-per-mile coverage may be a viable option for drivers who have high rates due to age and driving history. Unfortunately, these criteria are frequently given less weight in mileage-based programs.

Most mileage-based applications keep track of how far you've traveled.

Telematics programs for safe driving, on the other hand, track the number of parameters such as inattentive driving and forceful braking.

If you are a new driver on the roads of the United States, you could opt for Pay-Per-Mile coverage. Some of the best reasons we could think of are:

  • You don't drive much since you're in school
  • Got your license later in life
  • Recently relocated to the United States.
  • Older car that is less expensive to insure.

How to Save on Car Insurance as a New Driver

Let's look at some more methods to save now that we've covered the best insurance companies and the cost of insuring a new driver.

Stay on your Parent's Insurance Plan

Staying on their parents' insurance plan is the greatest option for a young driver to acquire inexpensive car insurance. Most of the time, the young driver's parents' insurance history, credit score, and driving history will result in lower rates than the new driver might find on their own.

A young driver can save thousands of dollars each year by staying on their parent's auto insurance coverage for as long as feasible. College students can normally remain on their parent's insurance policy as long as they do not drive their car while away from home.

Shop Around

Comparing rates from several companies is one of the best methods to find affordable coverage. This is because each insurer underwrites policies using slightly different rating variables, resulting in significant premium discrepancies. Compare auto insurance quotes from various companies to find who offers the best deal.

See what you could save on auto insurance

Select a Budget car

Insurance prices are influenced by a driver's car's value and other attributes. This is particularly true for inexperienced drivers. For example, a first-time driver in a brand new car or pickup truck is a significant red signal for an insurance company. A car with various safety features might also help you save money.

However, if these safety features incorporate high-tech sensors or other specialist equipment, the insurance premium may increase. Therefore, new drivers who want to save money should begin by driving an older car.

Select a High-Deductible Policy

Liability coverage may be the only insurance a driver legally needs to carry, depending on their location. However, physical damage insurance, such as collision or comprehensive coverage, may require some lenders, which can significantly raise costs.

These coverages' deductibles are inversely proportional to payments: the lower your deductible, the higher your insurance rates. So those searching for lower auto insurance rates might consider raising their deductible amounts to save money on coverage.

Look for Discounts

In the world of auto insurance, discounts are plentiful. State and insurance limits apply to many. Keep in mind that taking advantage of car insurance discounts will not result in a 50% reduction in premiums. They can, however, significantly reduce the cost of car insurance for new drivers.

How to get New Driver Car Insurance with Way.com

Getting a cheaper car can help you save a lot of money on insurance. If you're unsure how much you can afford, click on any of the banners of Way.com to get a rough estimate.

Do you know what separates Way.com from the others? Way.com has grown to become a leader in auto insurance, thanks to our focus on outstanding value and first-rate service. We give our customers a large selection of coverage choices, so you can rest assured you will get the right policy for your unique needs and goals. Way.com offers many different types of coverage for drivers.

Auto Insurance Data Methodology

The auto insurance rates published in this guide are based on the results of research completed by Way.com’s data team. Using a mix of public and internal data, we analyzed millions of rate averages across U.S. ZIP codes.

Quotes are typically based on a full coverage policy average unless otherwise noted within the content.

These rates were publicly sourced from insurer filings and should be used for comparative purposes only — your own quotes will differ. Given this, it’s important to go through our insurance steps form to find how much you can save with way.com

FAQ

What's the best insurance for a new driver?

Allstate, Progressive, and Safeco are the best car insurance companies for new drivers. In addition, they are one of the most affordable auto insurance providers for drivers of all ages.

Is it cheaper for a new driver to get their own insurance?

If possible, new drivers will discover lower rates by being added to someone else's insurance. This is especially true for teenagers and young adults, who may face significantly higher premiums when purchasing insurance on their own.

Why is first-time car insurance so expensive?

New drivers and cars have a higher risk of being in an accident. Car Insurance companies always prefer to be on the safer side by raising the insurance premiums for new drivers.

Can a 16-year-old have their own car insurance?

Yes, a 16-year-old can buy car insurance on their own. However, besides being more expensive, it will almost certainly require a different stage. Because children cannot sign legally enforceable contracts, they will almost certainly need a parent to approve or cosign the agreement.

How much is car insurance in NY for a 21-year-old?

In New York, the average monthly cost of vehicle insurance for a 21-year-old is $281. However, rates differ greatly amongst insurers.

Is car insurance cheaper when you're 21?

The cost of full-coverage vehicle insurance typically lowers with age, and premiums for young drivers can vary dramatically in just a few years. The average 21-year-old pays $384 per month, $232 less than what an 18-year-old would pay.

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