Best Car Insurance for Teens and Young Drivers

Adding a new, young driver to your insurance can bump up your rate significantly. Or if you are under 20 and trying to insure yourself on a budget, 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.

While you can’t change your age or driving experience, you can take advantage of these car insurance companies that have reasonable discounts and pricing. 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.

How we evaluate products

In compiling our list of the best car insurance choices for teen drivers, we looked at the top car insurance companies and evaluated them based on the unique criteria needed for teen and young drivers. The top criteria we looked at for comparison was availability, discounts for young drivers, AM Best ratings, and ease of use.

• Availability: We prioritized car insurance companies that were available nationwide. Companies like State Farm did not make the list because they do not offer coverage in several states. Most of the companies on the best of list offer coverage for teens and young drivers in every state and Washington D.C.
• Discounts for young drivers: Recognizing the financial burden that car insurance can place on families with teen drivers, we closely examined the discounts offered by each company. We prioritized insurers that provide specific discounts for young drivers, such as good student discounts, safe driving programs, and usage-based insurance options.
• AM Best ratings: We only considered companies with a B (fair) rating or better. Most of the companies chosen had the highest AM Best rating of an A++. According to AM Best, these ratings assess the ability of an insurance company to fulfill its policy and contract obligations to its holders.
• Ease of use: Today’s teens and young drivers are tech savvy, so we gave higher marks to companies that had easy-to-use apps and telematics programs to make filing a claim and getting a discount uncomplicated.

The best car insurance companies for teens and young drivers

• Best for customer satisfaction: State Farm
• Best for affordable rates: Geico
• Best for military members: USAA
• Best for infrequent drivers: Nationwide
• Best for 16- and 17-year-olds: Progressive
• Best for safe drivers: Allstate

Best car insurance comparison

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

Best for customer satisfaction: State Farm

AM Best Rating: B (Fair)

Despite being the largest car insurance company in the nation, State Farm has consistently ranked as one of J.D. Power’s s top picks for the ease of its shopping experience, filing a claim, and overall customer satisfaction, which is why we’ve kept it on the list, despite the recent drop in AM Best rating. According to AM Best, the drop in score is related to the sharp increases in claim severity, particularly in the umbrella and commercial multi-peril lines, which is not related to teen driver policies.

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 State Farm, 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 (a GPA of 3.0 or higher), you could save up to another 25%.

For college students who live on-campus and don’t need a vehicle to get around, State Farm will apply a “student away” discount that doesn’t interrupt your policy but doesn’t require full coverage for your young driver either.

State Farm also offers the Steer Clear program, which offers driver training through an app that encourages safe driving habits. Additionally, the Drive Safe and Save app connects your Bluetooth to your smartphone, allowing you to save up to 30% on your monthly premium. Not only can this app save you money, but it will give you better insight into your teen’s driving habits and where they need to improve — i.e. working on smoother acceleration.

Learn more in our full State Farm review.

Best for affordable rates: Geico

AM Best Rating: A++ (Superior)

Geico is the second-largest car insurance company in the country, 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.

Like State Farm, Geico offers several teen driver discount options, including the following:

• DriveEasy program: This app tracks driving habits. Enrolling in the program saves an automatic 10%, and your driver might be able to save even more after the monitoring period if their driving habits were deemed safe. Geico reported that 75% of its teen drivers are able to qualify for an additional discount.
• Good student discount: Full-time high school or college students with a B average or better can receive a 15% discount.
• Good driver discount: Additionally, Geico gives a 22% discount to drivers who have not had an accident within the past five years.

Find out more in our full Geico review.

Best for military members: USAA

AM Best Rating: A++ (Superior)

USAA — the United Services Automobile Association — is a good choice for military-connected families, since it focuses its service and discounts on current and past military members and their families. We recommend USAA for those who like to do all of their banking, investing, and insurance coverage in one spot.

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.

Other teen driving discounts include:

• Taking a driver’s training course
• Getting good grades
• Multi-vehicle discount
• USAA SafePilot, telematics driving program

One thing we do appreciate about USAA is how easy their app is to use. Teens will be able to pull up their insurance information on their phone, as well as connect with roadside assistance — a lifesaver when your new driver is stuck far away with a flat tire.

Learn more in our full USAA review.

Best for infrequent drivers: Nationwide

AM Best Rating: A (Excellent)

Accidents happen, especially if you are new on the road. Nationwide 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. This add-on cost can make your monthly premium higher, but can also save you from a huge increase in the case of an accident.

While no specific teen discount programs are listed, Nationwide policyholders can save through the following methods:

• Up to 40% with SmartRide usage and driving monitoring
• Good student discount

Despite having fewer discounts for teens and young drivers, we appreciate that it offers usage-based insurance. If you still have your permit or are getting comfortable behind the wheel and don’t drive much, you may be able to save a lot of money with its pay-per-mile insurance program, SmartMiles.

Learn more in our Nationwide Review.

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

AM Best Rating: A+ (Superior)

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.

One thing we appreciate about Progressive is how transparent they are about teen driver’s rates. According to their chart, teens between 17 and 17 can expect to pay $226.85 per month for auto insurance. Progressive states on their site, “Rates drop by an average of 9% when a driver turns 19 and another 6% at 21.”

Other discounts the company offers teens include the following:

• 10% good student discount
• Multi-car discount
• Snapshot telematics app and plug-in — the program can save drivers an average of $231 a year

Along with Snapshot saving policyholders money through safer and decreased driving, it can also alert you if your teen is driving distracted. This can be a good safety feature that ensures your young driver is safe, even when you are not in the car with them.

Learn more in our full Progressive review.

Best for safe drivers: Allstate

AM Best Rating: A- (Excellent)

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 discounted $70 fee, and you’ll get yet another discount after completion. Other discounts for young drivers include:

• Good student discount
• Multi-vehicle discount
• Defensive car course discount
• Drivewise telematics program means you pay less for safe driving
• Milewise available to pay-per-mile coverage

The Drivewise safe driving technology not only rewards you with a discount for safe driving, but it will automatically connect you to help if a collision over 25 MPH is detected. Your app will give you the option to call 911, get roadside assistance, or start an auto insurance claim.

Find out more in our full Allstate review.

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.

How to save money on car insurance for young drivers

Young drivers are considered riskier to insure, which is why monthly premiums can be higher the younger you are. There are several ways teens and young drivers can save on auto insurance. Try these tips to lower your premiums over $100 to $300 per year.

• Stay on shared policy for as long as possible: Most insurance companies allow young drivers to stay on their parents or guardians insurance plan until the age of 25. Exceptions to this rule might include marriage or living at a different permanent address.
• Exclude which cars your teen has access to: Some companies might allow you to exclude your young driver from certain cars. If so, don’t add them as drivers to your newer or pricier vehicles. Instead, have them drive the car that is most affordable.
• Choose a company that offers a usage-based insurance plan: This is especially useful if you don’t drive much.
• Opt for a higher deductible: Choose the highest deductible you could afford to pay out of pocket if you ever needed to file a claim.
• Don’t overbuy coverage: 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.
• Ask for additional discounts: 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.
• Use telematic programs: Drivers with a clean driving record typically have lower rates on their car insurance policies. Additionally, many insurance companies will offer you a discount for using their telematic devices or apps, which monitor driving behavior in real-time.

FAQs

Car insurance companies that didn’t make the list

Most major car insurance companies offer some form of discount for teen drivers, such as good student discounts or safe driving programs. Two popular car insurance companies we did not add to our best of list are Farmers and The Hartford.

Farmers

Farmers (AM Best rating: A) typically charges more per month to add on a teen driver, and the vagueness of the discounts on its site didn’t help us know how much we could expect to save. Additionally, Farmers is not available in all states, including Alaska, Delaware, Hawaii, Maine, New Hampshire, Rhode Island, Vermont, and Virginia. The fact that Farmers has also dropped over 100,000 customers in California does not inspire much confidence in the company.

The Hartford

Although The Hartford (AM Best rating: A-) rates well with J.D. Powers in many areas across the nation, it is a car insurance company that has more discounts for older drivers than young ones. The Hartford does offer a discount for young drivers that take a safe driving course, but most of its discounts are aimed towards drivers who have AARP memberships, can pay their yearly premium in full, and bundle their insurance with other coverage policies.

Just because these two companies didn’t make our best of list doesn’t mean they can’t give you the cheapest car insurance policy for your area. Both of these companies are still rated high with AM Best and might be the better option for your unique situation.

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.