Car insurance for 18-year-olds
The average 18-year-old driver on a separate policy from their parents pays $5,243 annually for full coverage car insurance and $1,652 annually for minimum coverage, according to Bankrate’s study of quoted annual premiums. On average, auto insurance rates for 18-year-olds are much higher than the average cost of car insurance in the nation as a whole. Young drivers have less driving experience on the road and are generally viewed by insurance companies as more likely to cause accidents. Understanding how your auto insurance rates are calculated and what you can do to lower your premium might help you learn how to handle your car insurance.
How much is car insurance for 18-year-olds?
Generally, 18-year-olds pay relatively high premiums for car insurance, with the average full coverage policy costing $5,243 per year and minimum coverage costing $1,652 per year. This is due in large part to the fact that 18-year-olds have not been driving for long. Drivers between the ages of 16 and 19 are at a higher risk for being involved in motor vehicle accidents than any other age group.
Additionally, statistics from the National Highway Traffic Safety Administration (NHTSA) show that car accidents are the leading cause of teenage deaths in the country, with over 2,000 young drivers between ages 15 and 19 killed in 2018 alone. To offset these increased risks, insurance companies charge more for young drivers.
Average cost of car insurance for 18-year-old males vs. females
Gender can be used as a rating factor in every state except California, Hawaii, Massachusetts, Michigan, Montana, North Carolina and Pennsylvania. Male drivers can typically expect to pay higher car insurance premiums, on average. Why? Male drivers statistically engage in riskier driving behaviors, which can lead to a greater number of and more severe accidents.
The table below breaks down the average cost of both full coverage and minimum coverage car insurance for 18-year-old males and females on their own policies. It is important to note that insurance laws vary by state and that there are states which ban the use of gender as a rating factor. In these states, men and women pay close to the same amount for insurance if all other factors are equal.
|Average annual full coverage premium||Average annual minimum coverage premium|
Cheapest car insurance companies for 18-year-olds
One of the easiest ways to save money on your car insurance is to choose a company with low average premiums. Bankrate’s insurance editorial team obtained average premium information for the largest carriers by market share in the country. We then analyzed the premiums to find the companies that offer low average auto insurance rates for 18-year-olds.
The average full coverage premium for each of these companies is well below the national average for 18-year-olds with full coverage, which is $5,243 per year. The cheapest company on our list for full coverage insurance is Erie, coming in at only $2,950 per year. However, keep in mind that the auto insurance rates below are averages and your individual premiums will vary based on your individual characteristics such as vehicle make and model, driving record and claims history.
|Company||Average annual full coverage premium||Average annual minimum coverage premium|
Erie is a regional carrier and isn’t available nationwide, but if you live in one of the 12 states where it is available, you may want to consider getting a quote. The carrier has the lowest average rate for both full coverage and minimum coverage for 18-year-olds, according to our research. Erie also offers numerous optional coverage types, as well as several discounts that teen drivers might be able to take advantage of. Erie also received the second-highest official score in the 2021 J.D. Power U.S. Auto Claims Satisfaction Study, indicating that customers are generally satisfied with its claims service.
Learn more: Erie Insurance review
USAA consistently receives high scores from J.D. Power, although the insurance company is not eligible for official ranking due to its eligibility restrictions. USAA’s coverage is only available to active and retired military and qualifying family members. If your parents have had USAA car insurance, you might get a discount for family loyalty. If you have taken a driving training course or you maintain good grades, you might save even more.
Learn more: USAA Insurance review
Auto-Owners, like Erie, is a regional carrier and is currently available in 26 states. The company offers three specialized teen discounts: good student, student away at school and teen driver monitoring discount. In addition to those discounts, you might save by paying in full, having another policy with Auto-Owners or signing up for a paperless policy. Auto-Owners also receives a low complaint index from the National Association of Insurance Commissioners (NAIC). A score of 1.00 indicates that the NAIC received an average number of complaints. Auto-Owners personal auto product has a score of 0.86, meaning the NAIC received fewer complaints about Auto-Owners than the industry baseline.
Learn more: Auto-Owners Insurance review
Geico is consistently one of the cheapest car insurance companies. Although its premiums are not the lowest for 18-year-olds on a national-average basis, the company could provide competitive rates in your area. Geico is also known for offering a long list of discounts that might help you keep your premium down. You could save by having a car with certain vehicle safety features, being a good student and even wearing your seatbelt.
Learn more: Geico Insurance review
Country Financial may not be as familiar to you as some of the other companies on our list, but the company does offer average premiums that are far less than the national average cost of car insurance for 18-year-olds. Country Financial only sells insurance in 19 states, and if you are eligible for coverage, you may want to get a quote. The company offers a good student discount and driver training discount, as well as more traditional discounts like safety features and defensive driver.
Learn more: Country Financial Insurance review
How 18-year-old-drivers can save money on car insurance
There are a variety of ways that young drivers may be able to save money on car insurance. Most involve taking advantage of the best car insurance discounts available, but there are a few other strategies.
If you’re an 18-year-old driver looking for ways to save on your car insurance, you may want to look into these tips.
Good student discount
Teens with good grades are statistically less likely to speed or drive recklessly. For this reason, many insurance providers reward good grades with a discount. You will likely only be eligible for this discount if you are a full-time student, and you will probably need to provide a copy of your most recent grade card to prove that your grades qualify. Every insurance company will have its own regulations, but many providers require you to be below the age of 25 and maintain a GPA of at least 3.0.
Distant student discount
If you plan to go to college without taking a vehicle, you might qualify for a “distance student” discount. However, this option is typically only available if you are insured on your parents’ policy. Usually, you will still be covered to drive when you are home on breaks, but you may want to check with your company to determine its specific rules.
Usage-based car insurance and telematics discounts
Many companies are offering discount programs that track your driving habits and award you a personalized discount. Usage-based programs, like Nationwide’s SmartMiles, track your mileage and allow you to pay based on the number of miles you drive, because being on the road less means you are at a lower risk of getting into an accident. Other telematics discounts, like Progressive’s Snapshot, track your habits behind the wheel as well as your mileage, like your speed, hard brakes and rapid accelerations, to award discounts based on your performance.
Opt for a higher deductible
If you have full coverage, your policy likely has two deductibles: one for comprehensive coverage and one for collision coverage. If you file a claim for damage to your vehicle, you will pay the appropriate deductible and the insurance company will pay the rest of the claim. Generally, increasing your deductible lowers your premium, because you are willing to pay more in the event of a claim, which saves the company money. However, you should make sure you can afford to pay the deductible if you do file a claim.
Most insurance companies offer discounts, and taking advantage of as many as you can might help you save. On top of good student, distant student and telematics discounts, you may be able to save by having a vehicle with safety features like anti-lock brakes, getting insurance with the same company as your parents and buying a renters insurance policy from the same company as your auto insurance.
How to get the best insurance for 18-year-olds
Although you may be purchasing car insurance for the first time as an 18 year old, finding the right coverage for you does not have to be a difficult process. It does, however, require a bit of research and understanding. Before you shop for insurance, it might help to:
- Understand how to read a quote: Car insurance policies compile several coverage types. Understanding what those coverage types are and what they mean might help you to choose the options that fit your needs.
- Think about your individual needs: Do you want a company that offers a mobile app? Are you looking for ridesharing coverage for your Uber or Lyft job? How much money can you spend on your car insurance? Knowing what factors are important to you could simplify your shopping process.
- Get quotes from several companies: Once you know what factors matter to you, you can get quotes from several companies that fit your needs. This will allow you to compare the premiums, coverage options, discounts, policy features and third-party scores. Just make sure you’re getting quotes for the same coverage types and limits from each company to compare rates accurately.
- Take advantage of discounts: Not all discounts are applied automatically. Talking to a representative could help you find additional ways to save.
If you are completely new to purchasing auto insurance, talking to an agent might be helpful. A licensed insurance professional can help you decide what type of coverage is best for your situation.
Frequently asked questions
Should I get my own coverage or stay on my parents’ policy?
If you still live at home, you may be able to stay on your parents’ car insurance policy. Generally, this is going to be a less expensive option. However, if you live on your own or own your car without a parent as a co-signer, you will typically need your own policy.
What is the difference between minimum coverage and full coverage?
Minimum coverage refers to purchasing only your state’s minimum required car insurance coverage and levels. These will vary by state. Full coverage refers to adding comprehensive and collision coverage, which adds coverage for damage to your own vehicle. Some auto insurance companies may also consider policies that include uninsured motorist coverage and roadside assistance a full coverage policy.
How do I know how much coverage to buy?
How much car insurance you purchase is a personal decision. When you buy coverage, you will have to purchase at least your state’s minimum limits — car insurance companies will not let you purchase less. However, most insurance agents recommend that you buy higher liability limits to provide better financial protection in case you cause an accident. If you have a loan or lease, your lender will likely require you to carry full coverage. Your coverage limits, deductibles and the optional coverage types you choose will depend on your unique situation.
At what age does car insurance get cheaper?
In almost all states, your age and gender play a huge role in how much you pay for car insurance. Premiums tend to peak for 18-year-olds and then begin to drop. Average insurance rates drop until around age 70, when they can start to creep up again. However, age and gender aren’t the only factors that impact your premium. Your choice of vehicle, the coverage types and levels you buy, your driving history and the state you live in will all impact how much you pay.
Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on an 18-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:
- $100,000 bodily injury liability per person
- $300,000 bodily injury liability per accident
- $50,000 property damage liability per accident
- $100,000 uninsured motorist bodily injury per person
- $300,000 uninsured motorist bodily injury per accident
- $500 collision deductible
- $500 comprehensive deductible
To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2019 Toyota Camry, commute five days a week and drive 12,000 miles annually.
These are sample rates and should only be used for comparative purposes.
Age: Rates were calculated by evaluating our base profile with the ages 18-60 (base: 40 years) applied. Depending on age, drivers may be a renter or homeowner. Age is not a contributing rating factor in Hawaii and Massachusetts.
Gender: The following states do not use gender as a determining factor in calculating premiums: California, Hawaii, Massachusetts, Michigan, Montana, North Carolina, Pennsylvania.