New drivers can find great car insurance deals with the right company. Allied leads overall at $202 monthly, but availability varies by region. Among national providers, Nationwide offers the best rates at $225 monthly, while Progressive costs $38 more at $263 — that's an extra $456 per year. GEICO sits close behind at $230 monthly, with State Farm at $239.
Best Car Insurance for New Drivers & Cheapest Rates in 2025
Updated: July 6, 2025
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Key Takeaways
Allied provides the cheapest car insurance for new drivers at $2,424 per year, but regional availability varies.
Young drivers under 21 get affordable rates with Nationwide, averaging $2,699 per year on a family policy. GEICO provides competitive rates for drivers 25 and under, with an annual average of $2,757 for minimum coverage.
New drivers face higher insurance premiums due to their lack of driving experience, but joining a family policy costs much less than purchasing an individual policy.
Best Cheap Car Insurance Companies for New Drivers
| Allied | $202 | $2,424 |
| Nationwide | $225 | $2,699 |
| GEICO | $230 | $2,757 |
| State Farm | $239 | $2,871 |
| Allstate | $262 | $3,142 |
| Progressive | $263 | $3,154 |
Cheapest Car Insurance for New Drivers by Age
Allied provides competitive coverage for the youngest drivers, with 16-year-olds paying $219 monthly — 17% less than the average. Seventeen-year-olds save more with Allied at $185 monthly, which is 24% below typical rates.
The landscape changes as you get older. State Farm becomes competitive for 18-year-olds at $230 monthly, though savings drop to 3%. Progressive offers the best rates for 19 and 20-year-olds, with monthly costs of $148 and $131 respectively. These Progressive rates represent savings of 32% and 33% compared to age group averages based on MoneyGeek's analysis.
Cheapest Car Insurance for New Drivers by Age and Gender
Gender affects car insurance rates for new drivers, with women typically paying less than men. Erie offers the best rates regardless of gender, with female drivers aged 16-20 paying $229 to $352 monthly versus males at $250 to $395. The gender gap narrows with age. Sixteen-year-old males pay $67 more monthly than females, but by 20, the difference drops to $21 according to MoneyGeek's research.
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| Erie | $352 | $4,226 | 52% |
| Auto-Owners Insurance Co | $365 | $4,376 | 51% |
| State Farm | $481 | $5,769 | 35% |
| Travelers | $573 | $6,871 | 23% |
| GEICO | $633 | $7,601 | 14% |
Best Car Insurance for Young New Drivers
MoneyGeek reviewed the most affordable options for new drivers by age:
- [Cheapest Car Insurance for Young Adults](Cheapest Car Insurance for 21-Year-Olds)
- Cheapest Car Insurance for Teens
- Cheapest Car Insurance for College Students
- Cheapest Car Insurance for 21-Year-Olds
- Cheapest Car Insurance for 22-Year-Olds
- Cheapest Car Insurance for 23-Year-Olds
- Cheapest Car Insurance for 24-Year-Olds
- Cheapest Car Insurance for 25-Year-Olds
Cheapest Minimum Coverage Car Insurance for New Drivers
Erie offers the best minimum coverage rates for drivers 16-20. Sixteen-year-olds pay $181 monthly with Erie — 55% less than the average. This company maintains its lead through age 20, where rates drop to $114 monthly with 36% savings. Auto-Owners consistently ranks second, while State Farm becomes competitive for older teens, offering rates within $21 of the leaders by age 20 in MoneyGeek's comparison.
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Age:16
| Erie | $181 | $2,175 | 55% |
| Auto-Owners Insurance Co | $198 | $2,378 | 51% |
| State Farm | $271 | $3,248 | 32% |
| GEICO | $311 | $3,738 | 22% |
| Travelers | $323 | $3,871 | 19% |
Note: Rates shown are for minimum coverage insurance and represent the additional cost to add a teen driver to a family policy, not the total family premium.
Cheapest Full Coverage Car Insurance for New Drivers
Full coverage rates follow a similar pattern, with Erie maintaining the top position for new drivers. At age 16, Erie charges $373 monthly, saving drivers 52% compared to the average. Auto-Owners comes in second across most age groups, while older teens can find competitive options with State Farm. By age 20, Erie's rates drop to $240 monthly with 33% savings, and the pricing gap between insurers becomes smaller — just $82 monthly separates Erie from State Farm per MoneyGeek's data.
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Age:16
| Erie | $373 | $4,482 | 52% |
| Auto-Owners Insurance Co | $399 | $4,783 | 48% |
| State Farm | $529 | $6,343 | 32% |
| Travelers | $626 | $7,510 | 19% |
| GEICO | $650 | $7,804 | 16% |
HOW YOU CAN SAVE BY JOINING THE FAMILY POLICY
Young drivers living at home can join the family's policy for more affordable insurance. Those in college can usually stay on their parents' policy as long as their permanent residence remains the family home.
Cheapest Car Insurance for New Drivers by State
Car insurance rates for new drivers change a lot depending on where you live. District of Columbia has the best deals, with Erie charging 16-year-old women just $180 monthly, which is 83% cheaper than the state average. Hawaii offers consistent rates with GEICO at $81 monthly for everyone aged 16-20. Different companies lead in different regions, with Erie popular in Pennsylvania, Auto-Owners strong in the Midwest, and Travelers competitive in Arkansas and Kentucky per MoneyGeek's analysis.
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| Alabama | Auto-Owners Insurance Co | $371 | $4,454 | 55% |
| Alaska | Allstate | $455 | $5,464 | 17% |
| Arizona | Auto-Owners Insurance Co | $584 | $7,014 | 39% |
| Arkansas | Travelers | $422 | $5,061 | 51% |
| California | State Farm | $361 | $4,337 | 33% |
| Colorado | Auto-Owners Insurance Co | $662 | $7,950 | 40% |
| Connecticut | State Farm | $906 | $10,871 | 38% |
| Delaware | State Farm | $777 | $9,330 | 42% |
| District of Columbia | Erie | $310 | $3,724 | 75% |
| Florida | State Farm | $762 | $9,142 | 61% |
| Georgia | Auto-Owners Insurance Co | $464 | $5,569 | 58% |
| Hawaii | GEICO | $81 | $973 | 40% |
| Idaho | State Farm | $248 | $2,973 | 47% |
| Illinois | Auto-Owners Insurance Co | $332 | $3,990 | 57% |
| Indiana | Auto-Owners Insurance Co | $426 | $5,107 | 27% |
| Iowa | Auto-Owners Insurance Co | $335 | $4,018 | 31% |
| Kansas | Travelers | $399 | $4,783 | 43% |
| Kentucky | Auto-Owners Insurance Co | $432 | $5,184 | 54% |
| Louisiana | State Farm | $1,054 | $12,652 | 42% |
| Maine | Travelers | $323 | $3,874 | 33% |
| Maryland | Erie | $557 | $6,680 | 42% |
| Massachusetts | GEICO | $411 | $4,935 | 43% |
| Michigan | Auto-Owners Insurance Co | $303 | $3,631 | 65% |
| Minnesota | Auto-Owners Insurance Co | $282 | $3,381 | 55% |
| Mississippi | Travelers | $537 | $6,441 | 32% |
| Missouri | Travelers | $521 | $6,252 | 55% |
| Montana | State Farm | $282 | $3,386 | 55% |
| Nebraska | Auto-Owners Insurance Co | $389 | $4,664 | 45% |
| Nevada | Travelers | $958 | $11,496 | 44% |
| New Hampshire | GEICO | $409 | $4,911 | 20% |
| New Jersey | GEICO | $459 | $5,503 | 66% |
| New Mexico | GEICO | $418 | $5,014 | 47% |
| New York | Progressive | $486 | $5,829 | 54% |
| North Carolina | Progressive | $234 | $2,804 | 36% |
| North Dakota | Auto-Owners Insurance Co | $304 | $3,644 | 52% |
| Ohio | Erie | $262 | $3,149 | 55% |
| Oklahoma | State Farm | $530 | $6,356 | 43% |
| Oregon | State Farm | $516 | $6,193 | 40% |
| Pennsylvania | Erie | $474 | $5,691 | 51% |
| Rhode Island | State Farm | $427 | $5,126 | 64% |
| South Carolina | Auto-Owners Insurance Co | $429 | $5,145 | 52% |
| South Dakota | Progressive | $367 | $4,404 | 40% |
| Tennessee | Erie | $404 | $4,848 | 43% |
| Texas | State Farm | $444 | $5,328 | 55% |
| Utah | Auto-Owners Insurance Co | $533 | $6,394 | 44% |
| Vermont | State Farm | $231 | $2,770 | 44% |
| Virginia | Auto-Owners Insurance Co | $380 | $4,564 | 43% |
| Washington | State Farm | $509 | $6,112 | 40% |
| West Virginia | Erie | $338 | $4,058 | 53% |
| Wisconsin | Erie | $331 | $3,972 | 59% |
| Wyoming | GEICO | $278 | $3,335 | 33% |
WHAT IS THE CHEAPEST CAR INSURANCE FOR FOREIGN DRIVERS?
State Farm, Progressive and Farmers offer affordable annual full coverage rates for drivers with international licenses:
- State Farm: $1,114
- Progressive: $1,226
- Farmers: $1,459
However, if you’re only visiting the U.S. temporarily, the cheapest way to get foreign driver car insurance is to buy coverage from your car rental company.
Best Car Insurance Discounts for New Drivers
Here are some possible discounts that new drivers should look into when shopping around for car insurance:
- Good student discount: It's available at many different insurance companies, although they may vary in defining a good student. Expect to provide proof of at least a B average.
- Bundled discount: Bundling your home/renters and auto insurance from the same company can often earn you a 10% to 20% discount.
- Defensive driver discount: Check with your insurance company before selecting a defensive driving course, as some have a pre-approved list. These classes often provide a 5% to 10% discount, but even without a discount, they teach valuable skills to help prevent accidents, making them a worthwhile investment.
- Pay-in-full discount: If you pay your premium all at once rather than making monthly payments, you may get a 5% to 10% discount.
- Low-mileage discount: If you drive infrequently, you may qualify for a low-mileage discount. Eligibility varies by company, with some offering discounts for driving under 7,500 miles annually, while others set the limit at 10,000 miles.
- Green/hybrid car discount: Some insurers offer a 10% discount for driving a hybrid or electric vehicle.
How to Get Cheap Car Insurance for New Drivers
New drivers, especially young ones, typically pay higher car insurance rates. To manage these costs, consider using these tips and strategies:
- 1
Get on a family policy
Young drivers under 25 usually face higher insurance costs due to increased accident risks. To cut costs, they can join a family insurance policy. Students can also access discounts with good grades or if they're away at school without regular access to a car. Older new drivers, such as those in their 40s, can save with multi-car policies.
- 2
Shop around
New drivers can save on insurance by comparing quotes. Get at least three quotes to find the best rates. Reviewing options annually before policy renewal can also help. Gaining experience and keeping a clean driving record may lower costs over time.
- 3
Take advantage of discounts
Car insurance companies let you combine multiple discounts, such as student, good driver and safety feature discounts. For instance, GEICO offers up to 23% off if your car has airbags, while State Farm provides up to 20% off when you and a family member insure together. Take advantage of these discounts to lower your premiums.
- 4
Drive a less expensive car
Your car's value affects your insurance premiums. Insurers charge more for expensive cars due to higher repair or replacement costs. New drivers can save by choosing older, affordable vehicles, like a Toyota Camry, instead of a sports car.
- 5
Improve your credit score
Insurance companies use credit-based scores to determine rates, but Massachusetts, Michigan, California, and Hawaii prohibit this practice. Paying bills on time and keeping credit card balances low can help maintain a strong credit score and history.
MONEYGEEK EXPERT TIP
Low-mileage and safe drivers may lower their auto insurance premium with telematics/usage-based insurance. These programs monitor how often you drive, at what time you drive, your speed, whether you break hard and other details. If your driving habits are good, you may get a discount on your premium. — Mark Friedlander, Director, Corporate Communications, Insurance Information Institute
Cheap Car Insurance for New Drivers: Bottom Line
Every driver, including new car owners, must have insurance. Premiums are higher for new drivers because insurers consider them higher risk. Providers like Allied, Nationwide and GEICO offer competitive rates. Combining discounts for safe driving, defensive driving courses or good grades can help lower costs. Maintaining a clean driving record will gradually reduce premiums over time
Best Car Insurance for New Drivers: FAQ
MoneyGeek addresses the most common questions new drivers have about car insurance.
What company offers the cheapest insurance for new drivers?
Allied offers the cheapest rates overall, but availability varies by region. Among national providers, Nationwide provides competitive rates for new drivers and new teen drivers. The cheapest option for you depends on your driving history, location and other factors, so compare multiple quotes.
What factors influence the cost of car insurance for new drivers?
Several factors influence car insurance rates, including age, vehicle type and location. New drivers, especially younger ones, typically pay more due to limited driving experience.
How can new drivers qualify for discounts on their car insurance?
Many insurance providers offer discounts for good academic performance, completion of driver's education courses or safe driving habits. Ask insurers about available discounts.
Is it more cost-effective for a new driver to join a family policy or get an individual policy?
Generally, it's more affordable for new drivers to join a family policy. This can spread out the cost and often results in a lower combined premium than if the new driver had an individual policy.
How frequently should new drivers shop around for cheaper insurance rates?
Comparing insurance quotes annually is a smart practice. As drivers gain experience and maintain a clean record, rates may decrease. Shopping around ensures they get the best rate.
What if I'm new to an insurance company but not to driving?
Drivers with a gap in insurance coverage pay higher premiums. Insurers see them as higher risk, assuming they may have driven without coverage. Even experienced drivers face higher rates after a lapse in insurance.
How much does car insurance cost for new drivers?
Newly licensed adults pay an average of $3,131 annually for full coverage car insurance. While older first-time drivers pay more than experienced drivers, they usually get better rates than teens. Factors like driving history, vehicle type and location also affect premiums.
Does a teenager with a learner's permit need insurance?
Everyone with a permit needs car insurance to drive a car legally.
Which gender of new driver pays more on insurance premiums generally?
Drivers under 25 face higher insurance premiums, with young males paying the most. Insurers consider younger, less experienced drivers, especially young men, higher risk due to their likelihood of risky driving. Six states — Michigan, California, Hawaii, Pennsylvania, North Carolina and Massachusetts — prohibit using gender as a rating factor.
Best and Cheapest Car Insurance for First-Time Drivers: Methodology
Data Depth and Overview
MoneyGeek analyzed 2,474,515 quotes from 607 companies across 3,523 ZIP codes to determine the cheapest car insurance premiums for new drivers.
Driver Profiles
We used an average driver profile to gather insurance rates and identify the cheapest options for new drivers. The profile includes:
- Clean driving record
- 2012 Toyota Camry LE
We modified the profile for location, age and gender to reflect specific driver characteristics.
Defining Full Coverage
Unless specifically indicated, when MoneyGeek refers to full coverage on this page, it means a policy with:
- $100,000 in bodily injury liability per person
- $300,000 in bodily injury liability per accident
- $100,000 in property damage liability per accident
- Comprehensive and collision coverage, each with a $1,000 deductible
Defining Minimum Coverage
Unless specifically indicated, when MoneyGeek refers to minimum coverage on this page, it means a policy with:
- $100,000 in bodily injury liability per person
- $300,000 in bodily injury liability per accident
- $100,000 in property damage liability per accident
- No comprehensive or collision coverage
Learn more about MoneyGeek's auto insurance 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.