Expect car insurance premiums to cost much more as a driver under 21 than for more experienced drivers. The best way to lower your premium is to look at multiple companies with a high tolerance for insuring young drivers, leading to low premiums. You also want to hone in on the right level of coverage for you, balancing solid protection with an affordable price.
Car insurance costs for under-21 drivers
Drivers at or under age 21 can expect to pay $104 to $115 a month, or $1,250 to $1,380 a year, for state-minimum car insurance coverage, or more for higher coverage. Rates are high for young drivers because these drivers get in more car accidents than more experienced drivers. Insurance companies make up for the risk by raising premiums until drivers hit specific age marks like age 21 or 25.
Cheapest car insurance for under-21 drivers
Of the national providers, Progressive and USAA offer some of the lowest rates for drivers under 21. But California drivers should get quotes from smaller, local companies like Mercury and Grange since these may offer the lowest rates, depending on your car and driving history.
Some car insurance companies cater to new and teenage drivers with lower rates than other companies offer. Compare sample annual quotes for an average driver living in California. While not representative of costs in every state or for every driver, these example rates should give you an idea of how varied premiums can be and which companies to compare to get your unique quote based on your driving history, vehicle and location.
Cheap car insurance for a 21-year-old
Drivers at age 21 should consider switching insurers since some companies raise rates for hitting the legal drinking age. But the average rates drop by $40 per year.
Cheap car insurance for a 20-year-old
At age 20, you’ll see rate drops from most insurers, and some may lower rates significantly since you’re no longer a teen driver, such as Mercury, USAA and Progressive.
Cheap car insurance for a 19-year-old
At age 19, you may see some insurers like State Farm and USAA drop their rates compared to 18-year-old drivers, while other insurers raise them or hold steady.
Cheap car insurance for an 18-year-old
Find low rates as an 18-year-old driver through smaller companies like Mercury and Capital as well as USAA. But the average is over $125 more than drivers at age 21.
What to consider when buying car insurance
If you’re looking for an under-21 car insurance policy, it’s vital to compare your options to find the policy that’s right for you. Factors to consider when weighing up your options include:
1. Your policy’s value
You’ll probably look at the cost as one of your deciding factors in choosing a policy. You can get quotes from a variety of insurers to see which one offers the cheapest premium for drivers under age 21. Then, look beyond the dollar figure to that company’s benefits to make sure that you’re getting the best value.
2. What’s covered
Read over your policy to learn the types of coverage included in your quote and each coverage’s dollar limit, which is the maximum amount that your insurer will pay after an accident. Consider extra coverage that’s included for free, like accident forgiveness or replacing your car with a new one after a serious accident.
Also, read through the list of exclusions so that you know when and why the insurer may refuse a claim. For example, insurers may not cover drivers in your household who aren’t named on your policy, modifying your car or ridesharing without add-on coverage.
3. Claims process
Remember to investigate how the insurance company handles claims and what customers are saying about the company’s claims process. You should see 24/7 claims support by phone or online, and average to high ratings from customers for claims satisfaction, though every insurer receives complaints from time to time.
4. Online tools for convenience
If you’re interested in joining an insurer’s safe driver program or managing your policy online or in an app, check out the company’s online tools to see what changes you can make to your policy. Safe driver programs, also known as telematics, usually use an app where you can see customer’s app ratings.
Compare car insurance for drivers under 21
Consider which companies offer the right coverage and benefits for you, and select Get quotes to see your customized rate.
Ways to lower premiums for drivers under 21
Buying car insurance when you’re under 21 can be expensive since insurers will take your youth and lack of driving history into account when calculating your premium. The good news is there are several things you can do to reduce the cost of your premium.
- Stay on your parents’ policy. If you share a car with your parents or live at home, you could ask your parents to add you to their policy as a driver. Doing so will cost less than buying a separate policy.
- Choose a lower level of coverage. Consider whether you can minimize coverage, such as forgoing roadside assistance if your car warranty offers it or dropping comprehensive coverage on an older car.
- Use a family car. Instead of choosing a car that’s just for the new driver, consider using a car that the family shares. Save money if a driver under age 21 isn’t the primary driver, but stay up front about who drives the car the most to avoid denied claims.
- Pay-per-mile insurance. If you don’t drive as much, consider a pay-per-mile car insurance policy that charges you a base rate like $30 and then a few pennies per mile, focusing on how much you drive instead of your age or other factors.
- Avoid moving violations. Avoid speeding fines and other moving violations that could raise your premium. Plus, land a discount after completing a driving safety course.
- Take advantage of student discounts. You could score discounts up to 35% for maintaining at least a B average in high school or college, leaving your car at home while you’re living at college or enrolling in the company’s young driver programs.
- Take extra steps to protect your car. Consider upgrading your antitheft system or keeping your car in a locked garage to land multiple safety improvement discounts for your car.
- Know the cost of a DUI. If you steer clear of a DUI, you’ll keep your car insurance rates low, especially in states where penalties for a DUI are higher if you’re under the legal drinking age.
How to qualify for a good student discount
To qualify for a good student discount, you’ll need to show proof of the student’s grades, possibly reproving your status each time that you renew. Homeschooled students can qualify, and will need to qualify in the top 20% of standardized tests like the SAT or ACT.
- Maintain a report card with a B average or 3.0 grade point average or be on the Dean’s List or honor roll
- Provide a letter signed by your school’s administrator certifying you’re a good student
- Be younger than 25 years old
Ask an expert: How do I save on car insurance as a young driver?
Founder of insurance website Cuuver.com
It’s well known that insurance policies are more expensive for young and new drivers; these high prices don’t go down until you turn 25, so you should aim to reduce the costs however you can during this period.
A good way of doing this is sitting an advanced [driving] course straight after you get your license. This trains you to deal with additional driving challenges which aren’t fully considered in your driving test, including driving in the dark, as well as driving on highways.
Many insurers acknowledge that this course provides you with additional skills which make you a safer driver, so reduce their premiums for those who have this qualification. This makes an advanced course like this well worth doing for both your skills and your pocket.
What factors affect my premium costs?
While the numbers above are average for the state of California, your premium may be different. There are a number of other factors that have an impact on the cost of under-21 car insurance.
- Your driving experience. Generally speaking, the more driving experience you have, the less you pay for coverage. Your involvement in any accidents, any past fines and infringements will also be taken into account — but so will any defensive driving courses you’ve taken.
- Your claims history. Previous car insurance claim will impact the cost of your premiums.
- Your gender. Men under age 21 are more likely to get in an accident than young women, leading young male drivers to pay around 14% higher rates than young women. However, some states ban using gender as a rating factor, including California, Hawaii, Massachusetts, Michigan, Montana, North Carolina or Pennsylvania.
- The kind of car you drive. The higher the amount your car is covered for, the more you will have to pay for coverage. Some cars cost less to insure than others. You’ll pay more if you’re driving an older car without minimum safety or antitheft devices, a high-performance vehicle, a car with modifications or a newer model luxury car.
- How often you drive. If you cover 30,000 miles each year, you’ll pay more for your policy than someone who drives only 5,000 miles a year to local shops. If you don’t drive much, you can save more with mileage-based discounts.
- The features you select. Additional features such as roadside assistance will also drive up the cost of coverage.
Coverage to consider for drivers under 21
For drivers of any age, purchasing coverage is one of the major expenses you contend with when you start driving, and most states require you to have a minimum amount of coverage before you hit the road. Consider this coverage:
- Bodily injury liability will help you pay costs that result from any injuries you cause to another person. These may include immediate medical aid, legal help, health care, funerals and pain and suffering.
- Comprehensive coverage insures against damages that aren’t within your control, such as natural disasters, terrorism, explosions and fire, glass damage, falling objects, vandalism, damage from animals and theft. Unlike liability insurance, you’re not required to have comprehensive coverage regardless of the state you live in.
- Collision coverage pays for costs if your vehicle is damaged. If you’re at fault in an accident, your liability insurance kicks in and pays for the other driver’s costs. For your own vehicle repairs, you’ll need collision coverage.
- Uninsured or underinsured motorist covers you if you have an accident, and the person who is at-fault doesn’t have enough coverage to pay for the damages to your car. You can choose to have bodily injury (UMBI) or property damage (UMPD) coverage.
- Medical payments helps you with your medical costs resulting from a car accident — no matter who’s at fault. It covers you and your passengers pays for such expenses like ambulance fees, surgery, funerals, dental care, prosthetic limbs and hospital visits. Medical payments coverage will also protect your when you’re walking or riding your bike.
- Gap insurance covers you if your car is stolen or totaled and you owe more on a loan than your car is worth.
- Personal Injury protection pays for the medical services you may need afterward including ambulance rides, nursing care, prosthetics, lost income, childcare and funeral services. It applies regardless of who’s at fault in an accident.
- Property damage liability will help you pay costs that result from any damages you cause to someone else’s property. These costs may include vehicle repairs, repairs for damage to buildings, houses or fences, lost income from business closures or legal fees from property damage claims.
Traps to avoid for drivers under age 21
A few pitfalls can end up costing you a lot. Consider these suggestion when you’re buying car insurance:
- Compare your options. It’s vital to compare multiple car insurance policies before you purchase coverage. Not only will this help you find affordable coverage, but it will also help you choose a policy that matches your needs.
- Paying annually. Many insurers will charge you extra if you decide to pay your premium in monthly installments. If this is the case, either pay annually or find an insurer that doesn’t charge extra for paying monthly.
- Remember the deductible. If a car insurance quote seems too good to be true, it most likely is. A cheap policy may save you money on premiums but then hit you with a huge deductible when you make a claim.
- Beware of fronting. To avoid the high premiums imposed on young drivers, some people will falsely list a parent or other older person as the main driver. This is called “fronting.” It’s illegal and could lead to your claim being refused.
- Review your policy. While it’s easy to simply renew your coverage with the same insurer when the time comes each year, shopping around can save you a whole lot of money. Car insurers often don’t reward their customers for loyalty, so regularly review the coverage offered by your current insurer and obtain quotes to see if you might be able to find a better deal elsewhere.
While finding car insurance as a young driver can be difficult, it’s still possible to find an affordable policy that meets all your coverage needs. Compare car insurance policies to find the perfect coverage for your set of wheels.
Learn more about car insurance for drivers under 21