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Best Car Insurance for Young Drivers in 2024

Young drivers face unique challenges when it comes to finding the right car insurance in 2023. How can they secure the best rates without compromising on coverage?

Holly Johnson

Holly Johnson is the founder of Club Thrifty, a personal finance and travel resource geared to families who want to...

Jeff Rose, CFP®

Jeff Rose, CFP® is a Certified Financial Planner™, founder of Good Financial Cents, and author of the personal finance...

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GoodFinancialCents® partners with outside experts to ensure we are providing accurate financial content.

These reviewers are industry leaders and professional writers who regularly contribute to reputable publications such as the Wall Street Journal and The New York Times.

Our expert reviewers review our articles and recommend changes to ensure we are upholding our high standards for accuracy and professionalism.

Our expert reviewers hold advanced degrees and certifications and have years of experience with personal finances, retirement planning and investments.

When you’re a teenager or a young adult, buying car insurance is rarely fun or affordable. This is true for anyone trying to add coverage to a parent’s existing policy, but it’s even more true for young adults who need to find cheap car insurance on their own.

That said, the best car insurance for young drivers offers quality protection for the entire household without breaking the bank. If you’re looking for the best cheap car insurance for young adults, however, you’ll need to compare policies and plans while also checking for discounts you might qualify for.

In the meantime, you’ll want to see which types of auto insurance you really need and which ones you can go without.

Table of Contents

We compared more than 20 of the best auto insurance companies to help you find the best car insurance for young drivers in 2024. If you’re ready to buy a policy or begin comparing all your options, you can stop looking and start your search here.

Our Picks for Best Car Insurance for Younger Drivers

The reviews below can help you learn more about the best car insurance companies that made our ranking, including the policy options and special programs for young drivers they offer.

Nationwide offers an array of coverage options for teenagers and young drivers, as well as discounts that can make coverage considerably more affordable. Young drivers can purchase insurance with liability-only coverage, but they can also opt for collision coverage, comprehensive coverage, and even rental car reimbursement coverage that kicks in when a car is in the shop getting repairs after an accident occurs.

Accident forgiveness is another optional feature for young drivers. This add-on coverage ensures that a teen or young driver’s car insurance premiums won’t surge right away after their first at-fault automobile accident occurs.

Major discounts available from Nationwide for teens and young drivers include:

American Family Insurance is another highly-rated insurance company that extends coverage to young drivers and teenagers who are being added to a family plan. This company offers all the basic insurance coverage you would expect, from liability coverage to collision, comprehensive coverage, uninsured and underinsured motorist coverage, and rental car reimbursement. They also offer optional emergency roadside coverage, which can be accessed with ease using the MyAmFam mobile app.

This company also offers a Safe Driver Discount Program for Teens, which monitors your teen’s driving habits with the help of a mobile app. Once a teenager drives at least 3,000 miles with the app on, families can qualify for a 10% discount on their car insurance premiums.

Other notable discounts for young drivers include:

Allstate is another insurer that is known for its Accident Forgiveness program. While joining this program doesn’t help you lower your premium at first, you won’t see your monthly auto insurance costs surge after your first accident. In the meantime, Allstate also has a Safe Driving Bonus program. If you add this feature to your policy, you get a check in the mail every six months if you don’t have an accident. This is Allstate’s way of incentivizing safe driving habits.

Also, note that Allstate extends good student discounts for drivers who are under the age of 25. This means high school students and teenagers with good grades can help their parents secure lower car insurance rates, but it also means young adults in college can get a discount on their own policies.

Allstate’s best car insurance discounts for young drivers include the following:

State Farm offers a program for young drivers under the age of 25, which is called Steer Clear. This program requires drivers to use a mobile app that monitors their driving, and it is only available to young drivers who don’t have any at-fault accidents or moving violations within the last three years. Those who qualify for this program can save up to 20% off their auto insurance premiums when they avoid accidents and drive safely over the long run.

Not only does State Farm make it easy to add a young driver to a household car insurance policy, but they also offer affordable premiums for young drivers who are out on their own. Additionally, this company offers an array of discounts that relate to vehicle safety instead of the age of the driver, including passive restraint discounts and discounts for having an eligible anti-theft device installed on a vehicle.

Other discounts for young drivers offered by State Farm include:

Geico is one of the most price-competitive auto insurers on the market, and it offers quite a few discounts and programs for young drivers. For starters, this provider offers a family pricing program that lets young drivers get the same policy rates as experienced drivers within the same family. This means young drivers get the chance to establish a good driving record without paying high premiums that are typical for new drivers.

Geico also offers an Accident Forgiveness Program for drivers of all ages. This discount applies to only one member of the family on a single policy, but it helps prevent surging premiums in the event of an at-fault accident.

Other popular discounts from GEICO include the following:

If you’re a member of the military or an eligible family member, you may also qualify for auto insurance through USAA. This company is one of the highest-rated insurance companies across the board, and they offer an array of programs and discounts for young drivers and teenage drivers alike.

As an example, USAA offers a program called SafePilot that can help anyone save up to 30% off their car insurance premiums if they complete a safe driving program and live in an eligible state. Families who have a teen on their policy can also help their kids save when they leave the next. In fact, adult children of USAA car insurance customers qualify for a 10% family discount.

Other USAA discounts for young drivers are listed below:

Car Insurance Guide

Before you settle on a new car insurance policy, you should understand the ins and outs of auto insurance for young drivers. For example, you’ll want to research the different types of car insurance, as well as the average cost of car insurance based on the policy you buy, where you live, and other factors.

How Does Car Insurance for Younger Drivers Work?

Car insurance for young drivers works the same as coverage for anyone else, yet this kind of insurance protection tends to be more expensive overall. The fact is, young drivers have considerably less experience on the road, and they consistently have accidents at a much higher rate as a result. According to the CDC on average 18 teens die every day in fatal car crashes. The Insurance Institute for Highway Safety reports that teens aged 16-19 are 3x more likely to get in a crash compared to those 20 years or older.

To account for this increased level of risk, car insurance companies charge higher premiums for the same types of coverage.

Generally speaking, however, car insurance rates tend to go down once individuals turn at least 25 with a safe driving record. Getting married can also help lower car insurance premiums considerably, as can becoming a homeowner, having a good credit score, and achieving other important life milestones.

As we noted already, the average premium for young drivers varies depending on where you live, whether you remain on a parent’s policy and other factors. However, a recent report from The Zebra shows that some age groups tend to pay much higher premiums overall, including some specific age groups below 25.

According to 2023 figures released in the study, drivers in the “teen” age group pay the most, with a typical 16-year-old driver paying an average of $6,034 per year for their own car insurance policy. Meanwhile, the average annual cost for all teenagers works out to $4,796 annually.

From there, each age group gets a better deal on auto insurance premiums until drivers reach their 60s and prices begin to tick up. The chart below shows the average car insurance premium by age group in 2023:

How to Lower Car Insurance Costs

Whether you decide to lease or buy a car or you’re currently driving an old beater while you wait for the best time to buy a new car, there are plenty of steps you can take to score more affordable car insurance premiums. Some of the best strategies you can use to save money are detailed below:

These are just some of the auto insurance discounts for students, but there might be others depending on the company you choose for coverage. When you shop around for your auto insurance policy, make sure to ask which discounts you might be eligible for.

How We Found the Best Car Insurance for Younger Drivers

To find the best car insurance companies on the market today, we looked for providers who have an ‘A’ rating or better for financial strength from A.M. Best.

We also looked for companies that offer highly-rated mobile apps, as well as those that advertise special programs and discounts for teen drivers.

Finally, we only considered car insurance companies that have an ‘A’ rating or better with the Better Business Bureau (BBB).

Summary of the Best Car Insurance for Younger Drivers June 2024

3 Cited Research Articles

Zebra Insurance (2022) 2022 The State of Auto Insurance https://www.thezebra.com/state-of-insurance/auto/2022/#download

Insurance Institute for Highway Safety (2023, May) Fatality Facts 2022 Teenagers https://www.iihs.org/topics/fatality-statistics/detail/teenagers

Centers for Disease Control and Prevention, National Center for Injury Prevention and Control (2022, Nov 21) Teen Drivers and Passengers: Get the Facts https://www.cdc.gov/transportationsafety/teen_drivers/teendrivers_factsheet.html

About the Author

Holly Johnson is the founder of Club Thrifty, a personal finance and travel resource geared to families who want to make the most of their incomes while seeing the world. She is also the co-author of budgeting book Zero Down Your Debt: Reclaim Your Income and Build a Life You'll Love. The book explains the step-by-step process behind zero-sum budgeting, which is the type of budget Johnson and her husband used to pay off debt in their 20's so they could begin building their investment portfolio in their 30's and 40's. Before beginning a career in personal finance, Johnson worked in the funeral industry alongside her husband Greg. She attended Ball State University in Muncie, Indiana, and she was given the Best Contributor/Freelancer for Personal Finance at the 6th annual Plutus Awards Ceremony in 2015. Johnson is an investment expert who built and manages her own seven-figure portfolio, and she frequently writes about various investment strategies as a result. She also covers credit cards, loans, insurance and other banking topics for publications like Forbes, CNN Underscored, U.S. News and World Report, Bankrate, and more. Highlights: *Award-winning personal finance writer *Author of budgeting book, Zero Down Your Debt: Reclaim Your Income and Build a Life You'll Love *Owner of finance and travel site ClubThrifty.com *Owner of freelance writing course, EarnMoreWriting.com *Regular contributor to CNN, Forbes, Bankrate, and more

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