Cheap car insurance for new drivers doesn’t have to be hard to find. Learn how discounts, rate comparisons, and innovative strategies can help you keep premiums low and affordable. Car insurance premiums vary widely by age because crash rates decline as drivers gain experience.
Research from MoneyGeek shows that teen drivers pay the highest premiums, averaging $230-$457 per month nationwide, while drivers aged 20–25 pay around $152 per month. Middle‑aged drivers enjoy the lowest rates, around $101 per month, before rates rise again in older age.
The same study notes that 16‑ to 17‑year‑old drivers pay $457 on average per month, while 18‑year‑olds pay $330 and 20‑year‑olds pay $207. These figures underscore how steep premiums can be for new drivers.
What constitutes a “new” driver?
Insurance companies define “new driver” in several ways. The Zebra’s research explains that insurers usually treat someone as new or inexperienced until they have about three years of U.S. driving experience
Freeway Insurance clarifies that a driver is considered inexperienced until they either
reach their early to mid-twenties or accumulate at least three years of driving history. During this period, insurers lack data on your driving habits, so they charge higher premiums to hedge against potential claims.
Factors That Influence Premiums
Age and driving experience
Age is the single most significant factor in determining premium costs. According to MoneyGeek’s data, 16‑year‑old drivers average $457 per month, while the average monthly premium drops to $119 by age 25.
Younger drivers are statistically more likely to be involved in crashes, so they pay higher premiums. Insurers also consider experience: drivers with a clean record for 3 years often qualify for “good driver” discounts and see significant reductions.
Location and state requirements
Where you live affects insurance costs because each state has different minimum coverage requirements and risk levels. MoneyGeek notes that young drivers can pay as little as $25–$40 per month for minimum coverage in low‑cost states like Indiana, but $70–$90 in expensive markets. States with higher minimum coverage levels exhibit smaller gaps between liability‑only and full coverage, so check your state’s requirements before choosing a policy.
Vehicle type and safety features
The make and model of your car significantly impact premiums. The Zebra advises new drivers to choose a moderately priced or older vehicle because combining inexperience with high‑repair‑cost vehicles or premium brands like a Mercedes‑Benz leads to higher rates.
Cars with advanced safety features can qualify for equipment or anti‑theft discounts, but highly specialised sensors can actually increase repair costs. NAIC echoes this advice, stating that insurers often charge more for vehicles that cost more to repair or offer less occupant protection. Cheap car insurance for new drivers
Coverage level and deductibles
The more coverage you buy, the higher your premium. Progressive notes that most states require only liability insurance, but lenders may require collision and comprehensive coverage on financed vehicles. The Zebra explains that many new drivers opt for “basic” full coverage with 50/100/50 liability limits.
Still, you can lower premiums by raising deductibles. However, choose a deductible you can afford in case you need to file a claim.
Credit history and driving record
In many states, insurers use credit‑based insurance scores to set rates. Freeway Insurance recommends establishing and maintaining a good credit score early because it helps new drivers qualify for lower rates.
A clean driving record is also crucial. The Zebra stresses that any tickets, accidents, or lapses in coverage can raise your rate for years. The NAIC encourages drivers to maintain a good driving record because safe drivers pay less.
How to Find Cheap Car Insurance for New Drivers
Compare multiple quotes
Cheap car insurance for new drivers. Insurance premiums vary widely by company. The Zebra advises new drivers to shop around and compare rates from several insurers because each company underwrites risk differently.
Tools like online quote comparators can reveal significant differences in monthly premiums for the same coverage. When comparing, ensure you use identical coverage levels and deductibles to obtain accurate comparisons.
Stay on parents’ policy (when possible)
For teen drivers, remaining on a parent’s policy is often the cheapest option. The Zebra notes that minors under 18 cannot legally purchase a policy on their own, and parents’ insurance background and credit scores can secure lower rates.
College students can often stay on their parents’ policy as long as they do not operate a separate vehicle while away from home. Freeway Insurance echoes this strategy, suggesting that teens ask parents to add them to a multi‑vehicle policy to benefit from lower rates.
Choose an inexpensive vehicle.
Driving an older or affordable vehicle reduces insurance costs because repairs and replacements are less expensive. The Zebra advises new drivers to avoid luxury or high‑performance cars and opt for reliable models with lower repair bills.
Freeway Insurance also recommends choosing a used but reliable car and avoiding flashy sports cars like a Corvette. For financed vehicles, you must carry full coverage, so purchasing a car outright can allow you to have only the state minimum liability.
Raise deductibles judiciously
Higher deductibles can lower your monthly premium, but they also increase the out‑of‑pocket cost after an accident. NAIC suggests reviewing your current deductibles and raising the physical‑damage deductible if you can afford the potential loss. Progressive adds that reducing coverage or increasing deductibles can lower premiums, but warns drivers to maintain adequate coverage in case of a significant loss.
Ask about discounts
Insurance companies offer numerous discounts that new drivers can take advantage of. The Zebra lists standard discounts, including multi‑policy bundles, multi‑car discounts, defensive driving course discounts, anti‑theft equipment, good driver discounts, profession‑based discounts, and good student discounts.
The NAIC recommends asking your insurer about discounts for driver education courses, two or more cars on a policy, airbags, anti‑theft devices, and bundling auto and home insurance. Students with a B average or higher often qualify for good-student discounts, and insurers may offer occupation‑based discounts for teachers, physicians, or police officers.
Consider usage‑based insurance or telematics.
Usage‑based insurance (UBI) programs monitor your driving behaviour—such as speed, braking, and mileage—through a smartphone app or plug‑in device.
Progressive encourages new drivers to try telematics programs to earn discounts for safe driving. The Zebra notes that telematics can help curb dangerous driving behaviours and reward safe driving habits. If you are a cautious driver who does not travel far, UBI can significantly lower your premium.
Maintain a clean driving record and build experience.
Keeping a clean driving record is one of the most effective ways to lower insurance costs. The Zebra’s licensed advisor advises new drivers to obey the law, stay alert, and avoid lapses in coverage, because tickets or accidents can raise rates for years. Freeway Insurance notes that insurers reward safe drivers after a few years with lower rates, while the NAIC reiterates that safe drivers pay less. Building experience also helps; insurers often reduce premiums after you have three years of incident‑free driving.
Build credit and financial responsibility.
Where permitted, insurers use credit‑based scores to assess risk. Freeway Insurance encourages teens to start building good credit by using a low‑limit credit card and paying it off each month. Although some states ban credit‑based insurance scores, establishing credit will serve you well in adulthood and can translate into lower premiums in many states.
Coverage Types and State Requirements
Liability coverage
Liability insurance pays for injuries and property damage you cause to others. It is mandatory in most U.S. states and usually expressed as three numbers (e.g., 50/100/50), representing bodily injury per person, bodily injury per accident, and property damage limits. Progressive advises new drivers to determine which coverages their state requires before buying insurance.
Collision and comprehensive coverage
Collision coverage pays for damages to your own vehicle in a collision with another car or object. Comprehensive coverage pays for non‑collision losses such as theft, vandalism, or hail. Lenders may require both if you finance or lease a vehicle. If you own your car outright, you may decide to carry liability only, but consider the potential cost of repairing or replacing your vehicle.
Full coverage vs. minimum coverage
Many new drivers wonder whether to buy full coverage or just the state minimum liability. The Zebra reports that 38 % of its customers choose “basic” full coverage (liability plus comprehensive and collision) with higher liability limits. Full coverage offers better protection but costs more. Evaluate your vehicle’s value, your risk tolerance, and your financial situation when deciding between minimum and full coverage.
Tips for Parents of Teen Drivers
Involve teens in insurance discussions.
The Insurance Information Institute (III) recommends that parents talk to teens about the responsibilities of driving, including the cost of insurance and the consequences of accidents or traffic violations. Encouraging teens to participate in the insurance conversation helps them understand why maintaining good grades and safe driving habits matters.
Encourage positive behaviours and qualify for discounts.
The III notes that insurers offer discounts to students who maintain at least a B average, take an approved driver training course, or attend college more than 100 miles from home without a car. Parents should monitor their teen’s performance and ensure proof of grades is submitted to the insurer. Freeway Insurance also emphasises taking defensive driving courses, which not only improve skills but often lead to premium discounts.
Assign teens to the right car and increase liability.
Cheap car insurance for new drivers advises assigning your teen to the least expensive car in the household to minimise premiums. Ensure your teen drives only the assigned vehicle; using another car could lead to penalties. It is wise to increase liability limits, as state minimums may not cover damages if your teen causes a serious accident.
Raise deductibles and bundle policies.
Raising your deductible reduces premiums, freeing up funds to increase liability coverage. Bundling auto and home policies can yield multi‑policy discounts, as highlighted by The Zebra and NAIC.
Frequently Asked Questions (FAQs)
1. Why is car insurance so expensive for new drivers?
Insurers view new drivers as high‑risk because they lack an established driving record. Teen drivers have the highest crash rates. 16‑ to 17‑year‑olds average monthly premiums of $457, so insurers charge more to offset potential losses. Rates decrease significantly after about three years of safe driving.
2. How long am I considered a new driver?
Most insurers consider drivers “new” or “inexperienced” until they have three years of driving experience. Some companies may continue to classify drivers as high‑risk until their mid‑20s, depending on age and driving history.
3. What is the cheapest way for a teen to get car insurance?
Remaining on a parent’s policy is usually the cheapest option. Parents’ established insurance history and credit score can secure lower rates, and multi‑vehicle discounts may apply. Teens should also maintain good grades to qualify for student discounts and take defensive driving courses at freeway.com.
4. Can I get cheap car insurance as a new adult driver?
Yes. Adult drivers generally pay lower rates than teens, but a lack of driving history still leads to higher premiums. Compare quotes from multiple insurers, choose an inexpensive vehicle, raise your deductible, and ask about discounts such as usage‑based insurance programs.
5. What coverage should a new driver choose?
At a minimum, purchase the liability coverage required by your state. If you finance your car, lenders may require collision and comprehensive coverage. Evaluate your vehicle’s value and finances: full coverage offers more protection but costs more. Increasing deductibles can lower premiums but raise out-of-pocket costs in the event of a claim. Cheap car insurance for new drivers
Conclusion and Call to Action
Although cheap car insurance for new drivers can be hard to find, it is not impossible to find. Premiums are high because insurers lack data about your driving habits and must hedge against risk. However, by understanding the factors that influence rates, such as age, location, vehicle type, coverage levels, credit, and driving record, you can take proactive steps to lower your costs.
Comparing quotes, staying on a parent’s policy, choosing a less‑expensive vehicle, raising deductibles, taking advantage of discounts, using telematics, and maintaining a clean driving record are all effective strategies for reducing premiums. Parents of teen drivers should involve their children in insurance discussions, encourage good grades and safe driving, assign teens to the least‑expensive car, and increase liability limits to protect family assets. Cheap car insurance for new drivers
Ready to start saving? Compare at least three quotes using identical coverage limits and deductibles. Ask insurers about good-student, defensive driving, and multi‑policy discounts
. If you’re a teen or college student, talk to your parents about remaining on their policy. Adults buying coverage for the first time should consider usage‑based programs and focus on building a safe driving record. With diligence and the correct information, cheap car insurance for new drivers is within reach—protect yourself and your wallet by acting today.
