Updated: June 24, 2025
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Finding affordable car insurance as a young driver requires balancing adequate coverage with budget reality. While young drivers pay 2-3x more than experienced drivers, strategic choices in coverage, vehicle selection, and discount utilization can reduce premiums by 30-50%.
Adding young drivers to a family policy is the most affordable option for car insurance, with Nationwide charging $2,718 annually ($226 monthly) for a 16-year-old.
For young drivers on a family policy, rates range from $1,406 to $2,718 annually, depending on the rate and driver's age.
For individual policies, GEICO offers the cheapest option for young drivers: $1,336 annually ($111 per month) for a 25-year-old.
Nationwide and GEICO offer the most affordable insurance for young drivers added to family policy. For individual policies, State Farm and GEICO have the lowest rates for young drivers.
Nationwide and GEICO offer the lowest rates for young drivers added to a parent's policy. The cheapest company depends on your age. Use the table below to find the most affordable rates based on age.
*The quotes provided assume a policy covering two parents and a young driver. These average costs reflect full coverage, including comprehensive and collision insurance, with liability limits of $100,000 per person for bodily injury, $300,000 per accident for bodily injury, $100,000 per accident for property damage and a $1,000 deductible.
Family policies deliver the biggest savings for young drivers, but eligibility and circumstances determine when they work best. You can add a young driver when they:
Family policies aren't always cheapest after age 22-23. Adding teens increases rates substantially but costs less than individual coverage. College students can stay on family policies with significant savings.
If a young driver isn’t eligible for a family policy, the next best option is an individual policy. State Farm and GEICO are the cheapest providers for young drivers on individual policies.
*The quotes above include comprehensive and collision coverages, along with liability limits of $100,000 per person for bodily injury, $300,000 per accident for bodily injury, $100,000 per accident for property damage and a $1,000 deductible.
Individual policies become financially viable around age 22-25, offering independence and credit-building opportunities. Young adults can customize coverage to their specific needs and budget constraints through individual polices unlike family plans. Consider individual coverage when you:
Insurance rules and rates vary by state and region. The cheapest car insurance in your state may not match national averages. Use the filters below to find the best cheap car insurance for young drivers in your state.
| GEICO | $2,303 | $1,177 |
| Allstate | $3,080 | $1,533 |
| Travelers | $3,252 | $2,153 |
| State Farm | $3,460 | $3,483 |
| Auto-Owners | $3,581 | $3,382 |
| Nationwide | $3,632 | $1,770 |
| Farmers | $6,422 | $2,440 |
| Progressive | $9,451 | $3,500 |
*The premiums listed are for full coverage with a $1,000 deductible. Liability limits include $100,000 per person for bodily injury, $300,000 per accident for bodily injury and $100,000 per accident for property damage.
Newly licensed 16-year-olds often face the highest premiums, especially with individual policies. Car insurance costs for young drivers vary by gender, with males typically paying more due to being considered higher risk. Most insurers lower rates at age 25 when drivers are considered less risky, but male drivers may still pay higher premiums.
Finding the cheapest car insurance for young drivers involves choosing the right coverage and provider. Extra steps like completing a safe driving course or limiting driving time can help lower costs. Take the steps below to find the most affordable policy:
A family policy is often more affordable than an individual policy if the young driver qualifies, often costing 30-50% less than individual coverage. Since each insurer has different criteria, comparing options can help you find the best fit.
Your coverage needs depend on your financial situation and what you can afford to lose. We recommend matching your coverage limits with your budget:
Tight Budget (Under $100/month):
Moderate Budget ($100-200/month):
Comfortable Budget ($200+/month):
Choose cars with high safety ratings, advanced safety features, and low theft rates. Avoid sports cars, luxury vehicles, and cars with expensive parts or poor safety records to save hundreds annually.
Your deductible choice dramatically affects monthly premiums. Increasing from $250 to $1,000 typically saves $200-400 annually.
Choose higher deductibles ($1,000+) when:
Choose lower deductibles ($250-$500) when:
Combine multiple discounts to achieve 30-50% total savings. Earn good student discounts (10-25%) by maintaining a B average, enroll in telematics programs (10-30%) that reward safe driving, complete defensive driving courses (5-15%), and bundle your auto policy with renters or home insurance (5-25%).
Use online calculators to get instant quotes. These calculators often include the same discounts offered by captive agents. Many major insurers let you sign up for a policy right after receiving a quote.
In some states, taking a safe driving course can help you get cheap car insurance rates. Practicing safe driving habits can also make you eligible for safe driving discounts and other incentives.
Young drivers who spend more time on the road have a higher risk of accidents, which can raise rates. Some insurers also consider mileage, which may increase your costs.
Monthly premium payments can fit your budget but often include installment fees, increasing overall costs. Paying in full can help you save money.
Review your insurance annually or after major milestones. Premiums for young drivers are often high but typically decrease as you gain driving experience.
You don't have to wait for your current policy to expire to look for a better deal. Switching car insurance companies could help you save money and better meet your needs.
Young drivers can access numerous discounts to reduce their premiums. Here's how the top insurers compare on key discount opportunities:
Discount | Nationwide | GEICO | State Farm |
|---|---|---|---|
Good student discount | Yes | Up to 15% | Up to 25% |
Student away at school discount | No info | Yes | Yes |
Safe driver discount | Yes | Up to 26% | Up to 30% |
Defensive driving discount | Yes | Up to 10% | 5–15% |
Low-mileage discount | Yes | Yes | Yes |
Multiple vehicle discount | Yes | Up to 25% | Up to 20% |
Home and auto bundle | Up to 15% | Up to 25% | Up to 17% |
Drive Safe Telematics | SmartRide® - tracks driving habits | DriveEasy – tracks driving habits | Drive Safe & Save™ – tracks driving habits |
Accident-free discount | Up to 10% | Up to 26% | Yes |
Choosing the cheapest car to insure can lower premiums. The Honda CR-V is the most affordable SUV, new car and used car to insure for young drivers. For insuring sports cars, the Subaru WRX has the lowest rates. The table below shows rates by age and coverage.
MoneyGeek reviewed the best cheap insurance for certain age groups to help you compare policies and companies:
Nationwide and GEICO are the cheapest auto insurance providers for family policies, while State Farm and GEICO have the lowest rates for individual policies. Choosing the right car, like a Honda CR-V, and taking advantage of discounts, such as safe driving courses, can help lower premiums.
MoneyGeek answers common questions about cheap car insurance for young drivers to help you find a policy with the best rate.
State Farm, GEICO and Nationwide offer the cheapest car insurance for teen and young drivers.
State Farm and GEICO offer the best cheap car insurance after an accident.
Car insurance usually gets cheaper at 25, but rates still depend on your driving record and other factors.
Newer cars aren’t always cheaper to insure for young drivers, especially expensive ones with higher premiums. However, newer models with advanced safety features may qualify for more discounts.
Due to their lower value, older cars are typically cheaper to insure for young drivers. Skipping comprehensive and collision coverage can further reduce costs.
Multi-car policies are usually cheaper for young drivers than individual ones. Bundling auto and home insurance with the same insurer can lead to additional savings.
Besides the student/young driver incentive programs offered by the insurance companies, adding a student/young driver to an existing policy of a more experienced driver could lower the policy cost for student/young drivers. Contacting a local agent is another way to secure a more affordable rate than purchasing a policy online for most insurers.
Some of the discounts available for young drivers are as follows:
However, it is important to remember that car insurance is one of the necessities you need to budget for. Plan for this expense and car maintenance and car payments to ensure that you can enjoy the freedom of owning and operating a car.
Even with discounts, young drivers will likely pay a higher premium than older drivers. However, as they develop a good driving record, their premiums may go down. Until that happens, young drivers may obtain a lower premium by taking a safe driving course. Not only may that result in lower premiums, but it will also make them safer drivers, which should help them avoid accidents and injuries and develop a good driving record, which may result in lower premiums in the future.
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Ask an expertWhy Trust MoneyGeek?Â
We analyzed data from state insurance departments and Quadrant Information Services to compare car insurance costs for drivers aged 16 to 21. Examining family and individual policies highlighted how quotes vary by provider and location.
Study Overview
Car insurance rates depend on age, driving record, claims history, ZIP code, coverage and insurer. MoneyGeek reviewed thousands of quotes to help young drivers and their parents find affordable options by comparing rates on family and individual policies for various ages.
Data Sources
We analyzed data from Quadrant Information Services and state insurance departments by company, state and driver age.
Driver Profile
Our sample driver profile ensured accurate quotes. Key details included:
Coverage Levels and Deductibles Explained
Average rates are based on 100/300/100 coverage with a $1,000 deductible for comprehensive and collision coverage.
A 100/300/100 coverage level provides per-claim limits of:
A $1,000 deductible means the policyholder pays the first $1,000 of a claim before the insurer covers the rest.
Learn more about MoneyGeek's methodology.
About Mark Fitzpatrick
Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. With over five years of experience analyzing the insurance market, he conducts original research and creates tailored content for all types of buyers. His insights have been featured in publications like CNBC, NBC News and Mashable.
Fitzpatrick holds a master’s degree in economics and international relations from Johns Hopkins University and a bachelor’s degree from Boston College. He's also a five-time Jeopardy champion!
Passionate about economics and insurance, he aims to promote transparency in financial topics and empower others to make confident money decisions.
