Best Car Insurance for Teens and Young Drivers

Choosing a company with a lot of discount options and customer-friendly pricing can help you identify the best car insurance for young drivers.
Last updated Jan. 20, 2023 | By Lindsay VanSomeren | Edited By Melinda Sineriz
Teen driving a car

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It can be tough to find affordable insurance if you’re a young, new driver. You’ll have a lot of things stacked against you: inexperience with driving, being perceived by insurers as likely to make riskier decisions, and possibly a not-so-great credit score to boot.

Luckily, each car insurance company sets its prices differently, and some may be more affordable than others. We’ll show you what signs to look for and which companies offer the best car insurance for young drivers in this review.

Key takeaways

  • Teens and young drivers pay the highest car insurance costs.
  • Get car insurance quotes from as many companies as possible to find the cheapest rates.
  • Many companies offer special car insurance discounts and programs to make car insurance for teens and young drivers more affordable.

In this article

The best car insurance companies for teens and young drivers

Best car insurance comparison

Best for Company Features for young drivers
Customer satisfaction State Farm
  • Discounts for those who qualify
Affordable rates Geico
  • Affordable rates
  • Discounts for membership in student organizations
Military members USAA
  • Affordable rates
  • Military-specific discounts
Infrequent drivers Nationwide
  • Accident forgiveness
  • Mileage-based insurance
Best for 16- and 17-year-olds Progressive
  • Discount for parents with teens under age 18 on their policy
Safe drivers Allstate
  • Accident forgiveness
  • Semi-annual safe driver bonus

Best for customer satisfaction: State Farm

Pros Cons
  • High customer satisfaction
  • Offers significant discounts for younger drivers
  • Not available in Massachusetts or Rhode Island

State Farm is the largest car insurance company in the United States. Despite its size, it still has a great customer service reputation. J.D. Power has consistently ranked it as one of its top picks for the ease of its shopping experience, filing a claim, and overall customer satisfaction.

That makes it a great company to grow with, but for younger drivers just starting out, it also offers some especially good discounts. According to the company, you could save up to 15% off your premium if you’re under age 25 and haven’t had any tickets or accidents in the past three years. If you get good grades while in school, you could save up to another 25%.

State Farm also offers the Steer Clear program, which offers driver training through an app that encourages safe driving habits. Parents can also monitor and guide their children’s progress.

Learn more in our full State Farm review.

Best for affordable rates: Geico

Pros Cons
  • Affordable rates
  • Discounts for students active in organizations
  • Mediocre customer ratings

Geico is the second-largest car insurance company in the country. It’s owned by Berkshire Hathaway, Warren Buffet’s company.

And, like its famous gecko mascot says, it’s known as being one of the cheapest car insurance companies out there — but of course, that can vary significantly, which is why it’s best to get multiple quotes when you’re shopping for cheap car insurance.

One thing to keep in mind with Geico is that it has lower customer ratings than other companies on this list. According to various J.D. Power insurance surveys in 2022, Geico’s app was rated below average, while its claims satisfaction, customer service, and ease of shopping were all rated as just about average.

Geico customers have lodged nearly twice the amount of complaints you’d expect for a company of its size with the National Association of Insurance Commissioners (NAIC) as well.

Find out more in our full Geico review.

Best for military members: USAA

Pros Cons
  • Military-specific discounts
  • High customer satisfaction ratings
  • Only available to military members, veterans, and their families

USAA — the United Services Automobile Association — has its roots as an insurance company, but it’s also a full-fledged bank too in case you were looking to keep all your financial products in-house. If you come from a military family, it’s a good option to consider given its consistently high customer satisfaction ratings and its potential savings.

According to the company, the average customer who switches to USAA saves $725 on their auto insurance policy. It also offers discounts that young drivers in military families might not be able to get in any other way, such as a discount of up to 15% if you park your car on base each night and up to 10% off if your parents are USAA members.

Learn more in our full USAA review.

Best for infrequent drivers: Nationwide

Pros Cons
  • Offers accident forgiveness
  • Offers usage-based insurance
  • Poor customer satisfaction ratings

If you’re especially worried about your rates rising if you get into an accident as a young driver, Nationwide might be a good insurer to go with. It offers an accident forgiveness add-on that keeps your auto insurance rates from rising after your first at-fault accident, even if you’re a teen or young driver. And if you don’t drive much, you may also be able to save a lot of money with its pay-per-mile insurance program.

The downside is that Nationwide was not rated very favorably in a series of J.D. Power’s 2022 insurance company surveys. It received consistently low marks for its digital and shopping experience, claims, and overall customer service.

Best for 16- and 17-year-olds: Progressive

Pros Cons
  • Teen driver discount
  • Coverage for pets if you buy collision insurance
  • Poor customer satisfaction ratings

Progressive is another company that doesn’t have the greatest customer satisfaction reviews in J.D. Power’s 2022 survey of overall customer satisfaction. However, there are still several things to like about Progressive, especially if you’re a young driver and your parents are open to keeping you on their own policy.

As long as the parent has been continuously insured through Progressive for the last year, the company will give you a discounted rate for adding your teen to your policy versus having them buy their own. This discount lasts up until age 18, potentially making it a good fit for 16-year-olds and 17-year-olds.

In addition, if you purchase collision coverage, Progressive will also cover a portion of the veterinary bills in case your furry friends are also hurt in an accident.

Learn more in our full Progressive review.

Best for safe drivers: Allstate

Pros Cons
  • Accident forgiveness program
  • Safe driving bonus every six months
  • High number of customer complaints

Allstate is another company that offers an optional add-on coverage for accident forgiveness in case you’re worried about rates going up if you get into an accident. A unique feature that Allstate offers is a safe driving bonus. For every six months you go without an accident, Allstate will issue a credit toward your insurance bill.

It also offers a proprietary teenSMART safe driving online training for a $70 fee, and you’ll get yet another discount after completion.

Unfortunately, Allstate suffers from the same problem with some of the other larger insurers — a poor record of customer complaints. Allstate has nearly 2 ½ times as many customer complaints lodged with the NAIC as a comparable company of its size.

Find out more in our full Allstate review.

How much does car insurance cost for teens?

According to a survey from Insurance.com, teen drivers paid annual average rates ranging from $7,203 to $3,532 for drivers between 16 and 20 years old, respectively. Costs start decreasing every year and tend to stabilize around age 34, at least for customers of the Progressive car insurance company.

That doesn’t tell you the full picture, though, because car insurance costs can vary tremendously depending on where you live, your driving record, your gender, which types of insurance coverage you buy, your deductible, and more.

How to choose the best auto insurance for young drivers

Drivers younger than age 18 will need to be on their guardian or parent’s policy. It still makes sense to shop around, though, due to the cost of insuring a young driver.

There are tons of options out there when it comes to auto insurance companies. Taking stock of your priorities when it comes to your insurance policy can help you zero in on the best car insurance companies for teenage drivers.

For many people, the cost of car insurance is the biggest consideration. But you might also think about:

  • Customer service ratings
  • Company financial stability
  • Features such as accident forgiveness or roadside assistance
  • Special insurance coverages you might need, like rideshare coverage
  • Other insurance offerings you might need from the same company, like homeowners, renters, or life insurance (many companies offer discounts for bundling different types of coverage)

Once you’re clear on what you want, you can start shopping for rates. Each company sets prices differently, and they can be wildly different.

The only way to find the most affordable car insurance premiums for your particular situation is to check your rates with as many companies as you can. Make a list in advance of which companies to check rates with, set aside some time, and record your rate quotes from each inquiry.

Tip
College students living away from home who don’t bring their vehicles may be eligible for a “student-away-from-home” car insurance discount.


How to save money on car insurance for young drivers

Car insurance coverage is almost always more expensive for young adult drivers. That said, there are a lot of ways you can bring the cost down to something more affordable. Here are some strategies:

  • Work on increasing your credit score and avoiding any missteps like missed payments.
  • Choose a company that offers a usage-based insurance plan, especially if you don’t drive much.
  • Choose the highest deductible you could afford to pay out of pocket if you ever needed to file a claim.
  • Take a hard look at which insurance coverage options you really need so that you don’t buy too much. For example, if you have an older vehicle, you may want to opt for liability coverage without collision or comprehensive coverage.
  • Check your rate with as many insurance providers as possible to boost your chances of finding the cheapest option. An independent insurance agent or broker could help you find the best rate.
  • Offer to reimburse your parents for letting you stay on their insurance plan if they’re open to it and you live at home or attend school.
  • See if your insurer offers any extra discounts or ways to save money, such as by taking a defensive driving course or another driver education course or installing a device to record your driving habits.
  • Keep up your grades. Many companies offer a good student discount if you have a B average or higher.
  • Drive carefully. Drivers with a clean driving record typically have lower rates on their car insurance policies.

FAQs

What is the cheapest car insurance for young drivers?

According to a study from The Zebra, USAA was the cheapest car insurance for drivers between ages 20 and 25, with an average annual premium of $1,936.

At what age is car insurance cheapest?

According to the insurer Progressive, car insurance rates for its customers tend to be stable and at their lowest rates when you’re between ages 34 and 75.

How can I lower my car insurance at 21?

If you’re able, ask your parents if you can reimburse them in order to be listed under their policy if you still live at home. After that, shop around as much as possible, make sure you’re getting all the discounts you’re entitled to, choose the highest deductible you can afford to pay, carefully consider which coverage options you’re buying, and drive safely.

Bottom line

If you’re looking for the best teen car insurance, certain companies may be better. USAA is a great choice if you’re affiliated with the military, or related to someone who is. State Farm gets great marks for good customer service.

However, the only real way to find the best option for you is to check your rate with as many car insurance companies as you can. It’ll take some time, but it’s the only way to ensure you find exactly what you need.

Methodology

The companies we chose for our list are popular insurance companies. We did not review all companies in the market. When evaluating these companies, we considered factors such as availability, discounts for young drivers, AM Best ratings, and ease of use.

  • You could save up to $500 with some companies
  • Compare dozens of providers in under 5 minutes
  • Fast, free and easy way to shop for insurance
  • Quickly find the perfect rate for you

Author Details

Lindsay VanSomeren Lindsay VanSomeren is a freelance writer based in Suquamish, Washington. Originally a wildlife biologist, Lindsay became passionate about helping others learn to live their best lives after seeing how positive money habits made a big difference in her own life. Her work has appeared in many outlets like Credit Karma, The Balance, FICO, Forbes, and more.