How much does new driver insurance cost? young drivers often pay the highest rates due to their age and inexperience behind the wheel. The top six reasons car insurance costs more for young drivers have to do with the increased risk to the insurance company.
Because young drivers are likely to be more reckless and distracted behind the wheel, insurers charge them higher rates. Car insurance for first-time drivers can be double or even triple the rates the average driver pays.
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Cheap car insurance for young drivers is still easy to find when you know how to shop for car insurance discounts. If you want to know how to get cheaper car insurance for drivers under 25, we’ll show you what individual factors influence your rates and what you can do as a new driver to reduce your risk.
why does car insurance cost more for young drivers?
Age is one of the first factors auto insurance companies consider when deciding their rates. the younger you are, the riskier you are to insure. This table shows how auto insurance rates vary by age and gender:
age and genderaverage annual auto insurance rates 17-year-old female$6,981.69 17-year-old male$8,330.16 25-year-old female$3,051.96 25-year-old male$3,235.09 35-year-old female$2,494.16 35-year-old female years old man$2563.70 woman of 60 years$2322.62 man of 60 years$2447.32 #blank#
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Why is car insurance so expensive for young male drivers? Because men are involved in more fatal accidents than female drivers, this has affected car insurance rates between men and women. Let’s discuss other reasons why car insurance for young drivers costs more and how you can save money on teen car insurance.
1. young drivers are more likely to have accidents
Teenagers and young adults have the second highest fatality rate of all drivers. In 2019, more than 5,600 young people under the age of 25 died in car accidents, compared to 4,958 drivers between the ages of 45 and 54.
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Insurance companies consider statistics like these and decide their annual rates accordingly. Accidents will increase car insurance rates at any age, but young drivers will see the highest increases. Young drivers can get cheaper car insurance quotes by taking a defensive driving course and keeping a clean record.
2. young drivers have an unproven track record
After age and gender, your driving record rounds out the top three factors that affect auto insurance rates. Unfortunately, new drivers come with little or no driving history, making it impossible for insurers to judge their behavior behind the wheel.
For example, an experienced driver with a good track record can probably handle a situation like hydroplaning on a rainy road. however, an inexperienced driver is new to these experiences and may not respond appropriately. Young drivers are more likely to panic or overcorrect when faced with an unusual circumstance on the road, increasing the risk of filing a claim.
3. teens and young adults are more likely to be distracted drivers
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Young drivers report that they are more likely to text, email and talk on the phone while driving. According to the CDC, distracted driving is responsible for 9% of all fatal crashes involving young drivers ages 15-20.
Distracted driving also includes talking to other passengers, reading directions, putting on makeup, and eating while driving. In 2019, distracted driving was responsible for nearly 6% of all fatal car crashes.
Because of the increased risk of distracted driving, insurance companies raise rates for teens who are more likely to be distracted behind the wheel.
4. young drivers are more likely to be reckless
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Teen drivers tend to be more reckless behind the wheel, leading to more accidents and more claims. The good news is that this risky behavior decreases as teens get older.
As young drivers enter their twenties, they are less likely to engage in risky behavior, whether behind the wheel or not. Consequently, insurance companies will lower rates as drivers age and maintain a clean driving record that shows they are less likely to get into an accident.
5. young drivers have lower credit scores
Teenagers and drivers under the age of 25 are less likely to open a line of credit, especially if they continue to live at home or are enrolled as a full-time student. Drivers with low credit scores are considered more likely to file a claim, and drivers with no credit are considered by insurance companies to be just as risky as drivers with poor credit.
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Fortunately, states are starting to ban the use of credit scores to determine insurance rates. If you live in California, Hawaii, Maryland, or Massachusetts, your credit score won’t affect your insurance quotes.
6. young drivers pose a financial risk to insurance companies
In general, young drivers pose a financial risk to auto insurance companies due to their lack of driving experience. Since young drivers are more distracted, more reckless, and more likely to have accidents, they are more likely to cost the insurance company money.
Young drivers often have to shop around high-risk auto insurance companies to find the most affordable rates. These insurers specialize in policies for drivers with bad credit, young drivers under the age of 21, or those with too many accidents on their record. however, you should compare insurance quotes from at least three companies before purchasing a high-risk policy.
where is the cheapest car insurance for young drivers?
How much does insurance cost for a new driver? teens can pay $200 to $1,000 more per month than drivers in their 20s. Comparing rates from different companies is the easiest way to find affordable teen driving insurance.
This table breaks down auto insurance rates for drivers under 19 and under 25 to see where you can get the cheapest rates based on age. Each of these companies offers competitive discounts designed for young drivers who are enrolled in school or driving classes.
car insurance companymonthly car insurance rates for teenagers (16-19 years old)monthly insurance rates (20-25 years old)safe driver discountgood discount for students agricultural agency$231$125up to 30%maintain an average of “b” or higher; discount amount varies series$311$194discount amount variescollege student discount; discount amount varies usea$423$1803%maintain a “b” average or higher; discount amount varies geico$479$23910%maintain a “b” average or higher; up to 15% state $577 $2045% maintain a “b” average or higher; up to 25% progressive$772$23410%maintain a “b” average or higher; up to 10% statewide $1,141 $317 10% off for smart students; discount amount varies #blank##blank##blank##blank#
farm bureau and erie offer the cheapest car insurance for young drivers. however, these companies are not available in all states, and you may need to purchase teen car insurance from other companies.
Fortunately, Geico and USAA offer very competitive quotes for young drivers. usaa is only available to military members and their families, but geico is available nationwide and offers some of the highest discounts for students and safe driving.
Which companies offer car insurance discounts for young drivers?
Young drivers can take advantage of great student discounts and safe driving discounts to lower their insurance rates. however, discounts may vary by company, and some young drivers are eligible for more discounts, including pay-in-full and usage-based discounts.
This table shows the most common discounts for young drivers with the most popular auto insurance companies:
You may also find that a local insurer in your city offers unique discounts for young and teen drivers. We recommend comparing with at least three different companies to find the best car insurance for young drivers near you.
how to get cheaper insurance for young drivers
Insurance companies take a huge financial risk with young drivers. therefore, your insurer’s rates will be higher to compensate for that risk.
Five things you can do to lower your auto insurance rates right now are:
- enter your parent’s policy. Adding a teen driver to car insurance is much cheaper than buying a new policy.
- get good grades. Maintaining a “b” average or higher can earn you 3%-10% off your rates.
- Go to driving school. More hours behind the wheel means more experience and cheaper car insurance rates.
- drives an older vehicle. the cheapest car for a teenager will be 2018 or earlier.
- install additional security features. adding alarms and etching your vin on your windshield can earn you 5%-15% off your rates.
The best thing young drivers can do to lower their insurance costs is to practice safe driving habits and avoid accidents and speeding tickets at all costs. It’s also worth looking for specific companies that may have discounts designed specifically for your situation. For example, Geico offers a seat belt discount, while Erie provides additional coverage for college students.
compare quotes from several companies to see which one can offer you the best rates and discounts. The best young drivers insurance will look beyond your age and work with you to find a policy that fits your lifestyle and budget.