Average Cost of Car Insurance for 18-Year-Olds in 2024

The average annual cost of full coverage car insurance for an 18-year-old on a family policy is around $2,641. This cost varies depending on factors like gender, location and the teen's driving record. GEICO offers the cheapest full coverage policy for 18-year-olds, averaging $203 per month, making it a cost-effective option for young drivers.

Teen drivers generally pay the highest rates for car insurance. Insurance companies use actuarial data that shows that teens are more likely to be involved in collisions, leading to higher premiums to offset this risk.

On average, the cost of a full coverage car insurance policy for 18-year-olds on a family policy is:

• For a female: $2,526 per year; $210 per month
• For a male: $2,756 per year; $230 per month

Gender significantly impacts car insurance rates for drivers under 25, with young men generally paying more due to higher accident rates and more careless driving habits. However, states like Michigan, Massachusetts, California, Hawaii, North Carolina and Pennsylvania prohibit insurers from using gender as a factor in determining rates.

The cost of full coverage and state minimum liability policies differ. MoneyGeek found that the cheapest car insurance companies for 18-year-olds on a family policy for each policy type are:

For full coverage policies:

• GEICO: $2,431 per year; $203 per month
• Nationwide: $2,476 per year; $206 per month

For state minimum liability policies:

• GEICO: $557 per year; $46 per month
• Travelers: $613 per year; $41 per month

GEICO stands out as the cheapest option for both full coverage and liability-only car insurance, priced at $2,431 and $557 annually, respectively. They also cater to young drivers with discounts for good academic records, completing safe driving courses and using vehicles equipped with safety features.

By coverage level, a male 18-year-old driver on a family policy should expect to pay:

• For state minimum liability: $515 per year; $43 per month
• For full coverage insurance: $2,641 per year; $220 per month

Eighteen-year-old drivers using older vehicles may find state minimum insurance adequate. However, it's important to be prepared for potential out-of-pocket expenses, as liability-only may not fully cover accident costs. Opting for full coverage provides a broader safety net despite higher costs. For new drivers, extra features like roadside assistance can also be invaluable in emergencies. Given the high-risk factors associated with young drivers, such as inexperience and a higher likelihood of accidents, more comprehensive coverage offers better financial security.

On average, teens will pay $4,965 more for an individual policy than if they were added to their parents’ insurance. The average cost of coverage for each is:

• Individual policy: $7,605
• Family policy: $2,641

To find the best cheap car insurance for 18-year-olds, the best strategy is to stay on a parent's policy until the teen permanently moves out of the family home. Opting for an individual policy at this age can be 39% more expensive than remaining under a parent's coverage.

Yes, an 18-year-old can legally purchase their own car insurance policy. However, it's often more cost-effective for them to remain on their parents' policy, as individual policies for young drivers can be significantly more expensive due to their higher risk profile.

Car insurance companies usually require all vehicles on a policy to be garaged at the same address. Therefore, unless the teen driver moves out permanently, keeping them on the family policy is typically the better option. An 18-year-old can stay on a family policy even when attending college.

Eighteen-year-olds in California pay $2,180 more for a full coverage policy than teens in Idaho. The cheapest state for 18-year-olds is Hawaii, with an average $998 annual premium for a full coverage policy. Rates are the lowest in Hawaii because insurers are not allowed to use age as a rating factor. On the other end of the spectrum, teens in Louisiana tend to pay the most, $6,625 per year.

Even though the state excludes the use of non-driving factors — like age and gender — in determining insurance rates, the average cost of car insurance in Michigan is still 68% higher than the national average. Other factors, like population density and elevated vehicle theft rates, may drive these high costs.

Teens pay more for car insurance than any other age group. Fortunately, there are steps teens and their families can take to meaningfully lower the cost of their coverage.

We answer the most common questions about car insurance for 18-year-olds, covering costs and tips for finding coverage.