How to Get Car Insurance for New Drivers (2026 Guide)

New drivers pay higher car insurance rates due to statistical risk, but staying on a parent's policy or qualifying for discounts can reduce costs.

Find out if your overpaying for car insurance as a new driver below.

Written by Mark Fitzpatrick

Updated: March 20, 2026

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Key Takeaways

Staying on a parent's policy reduces costs by up to 50% compared to buying a standalone plan if you're under 25 and living at home.

New drivers pay roughly 40% to more than double what experienced drivers pay, with annual premiums often exceeding $3,000 for full coverage.

Insurers define "new driver" differently, some use age, others use years licensed, meaning your rate timeline varies by company.

How to Get Car Insurance as a New Driver

New drivers have three main options: stay on a parent's existing policy, get added as a named driver to a family member's plan, or purchase a standalone policy. Staying on a parent's policy is almost always the cheapest option for drivers under 25 who live at home, but it requires that the parent's insurer permits it and that you're listed as a driver on their plan. Buying your own policy provides independence but comes with higher premiums.

If you're just starting out, our guide on how to get car insurance will help you work through the application process and avoid common mistakes that could raise your rates.

1
Decide Whether to Stay on a Family Plan
Staying on a parent's policy is almost always cheaper for drivers under 25 who live at home. Most insurers allow parents to add licensed dependents who reside at the same address, and the combined premium is typically lower than buying separate policies. You'll need to switch to your own policy if you move out, buy your own car, or turn 26. Review how long you can stay on your parents' car insurance to understand when it's time to transition.
2
Gather What You'll Need to Apply
Every insurer requires your driver's license number, vehicle identification number (VIN), current address and your desired coverage level before issuing a quote. If you're applying with a learner's permit, some insurers require a parent or guardian to co-sign the application. Have these documents ready before starting the quote process to avoid delays. See what information you need for a car insurance quote for a complete checklist.
3
Compare Quotes From Multiple Insurers
New driver rates vary more across insurers than for experienced drivers — the spread between the cheapest and most expensive provider can exceed $1,000 per year for the same coverage. Get quotes from at least three to five companies before buying. Use MoneyGeek's tools to compare the cheapest car insurance for teen drivers and find the cheapest car insurance for new drivers in your area.
4
Ask About New Driver Discounts
Good student discounts require a B average or higher and can reduce premiums by 10% to 25%. Defensive driving course discounts apply after completing an approved program, and distant student discounts are available if you attend school more than 100 miles from home without a car. State Farm, GEICO and Progressive all offer good student discounts, while Allstate and Nationwide provide defensive driving discounts in most states.
5
Choose Your Coverage Level
New drivers with older, paid-off cars may not need full coverage if the vehicle's value is low enough that collision and comprehensive premiums exceed the car's worth. New drivers with financed or leased vehicles are required by lenders to carry full coverage, which includes liability, collision and comprehensive. Learn how to lower your car insurance rate by adjusting coverage limits and deductibles to fit your budget.
6
Activate Your Policy and Confirm Coverage
Same-day coverage is available from most major insurers if you apply online or by phone before their cutoff time, typically between 12:01 a.m. and 11:59 p.m. on your start date. Once your policy activates, confirm your policy number and download your digital insurance ID card before driving. Keep proof of insurance in your vehicle at all times.

What New Drivers Need to Get Insured

Before applying for car insurance, new drivers must provide a driver's license, vehicle information, driving history details and a coverage decision.

Driver's License

Your license number is required for every quote. Learner's permits may require a parent co-applicant depending on the insurer's rules.

Vehicle Information

Insurers need your vehicle's VIN, make, model, year and current mileage to calculate your premium accurately.

Driving History

Even a short history matters. Any prior accidents or violations must be disclosed, as insurers verify this information through state DMV records.

Coverage Decision

Know whether you need liability-only or full coverage before applying. Lenders require full coverage for financed vehicles.

When New Drivers' Rates Drop

New drivers pay the highest car insurance rates in the market because insurers use accident data showing that inexperienced drivers file claims at nearly twice the rate of drivers over 30. Drivers under 25 with less than three years of licensed experience typically pay roughly 40% to more than double the national average, but premiums begin to drop after three years of clean driving.

Most insurers reduce premiums by 10% to 20% once you pass the three-year mark without accidents or violations. Progressive reduces rates for drivers who maintain a clean record for 36 consecutive months, and State Farm offers similar reductions at the three-year anniversary of continuous coverage.

Car Insurance for New Drivers Guide: FAQs

How much does car insurance cost for new drivers?

New drivers pay $2,500 to $4,000 per year for full coverage, depending on age, location and the vehicle they drive. Drivers under 18 typically pay the highest rates, while new drivers over 25 with recent licenses pay less than teenage drivers but more than experienced drivers.

Can a new driver stay on their parents' car insurance?

Yes, most insurers allow new drivers to stay on a parent's policy if they live at the same address and are listed as a named driver. This option is almost always cheaper than buying a separate policy. You'll need to switch to your own coverage if you move out, buy your own vehicle, or reach the insurer's age cutoff, which is typically 26.

What discounts are available for new drivers?

New drivers qualify for good student discounts (10% to 25% off with a B average or higher), defensive driving course discounts (5% to 10% off after completing an approved program) and distant student discounts (10% to 15% off if attending school more than 100 miles from home without a car). Some insurers also offer new driver training discounts for completing approved driver education programs.

Do new drivers need full coverage?

New drivers with financed or leased vehicles are required to carry full coverage, which includes liability, collision and comprehensive insurance. New drivers with older, paid-off cars can choose liability-only coverage if the vehicle's value is low enough that collision and comprehensive premiums exceed the car's worth. Evaluate your car's current market value before deciding.

How long are you considered a new driver by insurance companies?

Most insurers define a new driver as anyone with less than three years of licensed driving experience, regardless of age. Some insurers also apply the new driver classification to anyone under 25, even if they've been licensed longer. The definition varies by company, so your rate timeline depends on which insurer you choose.

What is the cheapest car insurance for new drivers under 25?

The cheapest car insurance for new drivers under 25 varies by state and individual profile, but GEICO, State Farm and Progressive consistently rank among the most affordable options nationwide. Rates for drivers under 25 are always higher than for older drivers, but comparing quotes from multiple insurers and applying available discounts can reduce premiums by hundreds of dollars per year.

We analyzed car insurance costs for new drivers using rate data from Quadrant Information Services, which collects ZIP-code-level premiums from major insurers nationwide. Our analysis compared premiums for new drivers under 25 with less than three years of licensed experience to the national average for experienced drivers. All cost figures reflect full coverage at 100/300/100 liability limits with a $1,000 deductible for collision and comprehensive.

About Mark Fitzpatrick

Mark Fitzpatrick, a Licensed Property and Casualty Insurance Producer, is MoneyGeek's resident Personal Finance Expert. He has analyzed the insurance market for over five years, conducting original research for insurance shoppers. His insights have been featured in 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!

He writes about economics and insurance, breaking down complex topics so people know what they're buying.

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How to Get Car Insurance for New Drivers (2026 Guide)

How to Get Car Insurance as a New Driver

Decide Whether to Stay on a Family Plan

Gather What You'll Need to Apply

Compare Quotes From Multiple Insurers

Ask About New Driver Discounts

Choose Your Coverage Level

Activate Your Policy and Confirm Coverage