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Car insurance for 20-Year-Olds
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Understanding how age correlates to auto insurance rates can help drivers budget for their policies. In general, younger drivers have less driving experience and present greater risk to insurers. Insurance companies know this and often charge younger drivers more than older, more experienced drivers. Whether or not young drivers are on their own policies or on their parents’ can also play a big role in premiums. The average annual rate for a 20-year-old driver on their parent’s policy with full coverage is $3,149, while it is $4,319 if they are on their own policy. Likewise, minimum coverage averages $995 annually for 20-year-olds on their parents’ policies and $1,322 annually if they are on their own policy.
How much is car insurance for a 20-year-old?
On average, 20 year olds on their own car insurance policy pay $4,319 per year for full coverage car insurance, according to premium data from Quadrant Information Services. Young drivers are often less expensive to insure if they are on their parent’s policy. For 20 year olds on their parents’ policy, coverage is $3,149 per year. Full coverage includes liability insurance as well as collision and comprehensive coverage. Although this is less than what teen drivers pay, on average, it is still far more than the national average cost of car insurance in 2023, which is $2,014 per year for full coverage.
By 20, many drivers have gained some skill on the road, but are still relatively new to the responsibilities of driving. This driving inexperience leads insurers to charge higher premiums to compensate for greater claims risk. However, you should see your premium drop as you age, assuming you maintain a clean driving record.
Average car insurance cost for 20-year-olds by state
Every state has its own insurance laws, which can affect the average rates for car insurance at any age. Additionally, each state has differing average rates of accidents and weather-related damage, as well as variable costs associated with medical care and vehicle repairs. All of these factors affect the average rates for auto insurance in your state.
|State||Average annual full coverage premium for 20-year-olds on their parents’ policy||Average annual full coverage premium for 20-year-olds on their own policy|
Rates were calculated for 20-year-old drivers either on their parents’ policy or as a renter on their own policy.
*Age is not a contributing rating factor in Hawaii and Massachusetts due to state regulations.
Best car insurance companies for 20-year-olds
Although price is important when shopping for insurance, it is not the only factor to consider when choosing your auto insurer. Bankrate’s insurance editors obtained current premium information for the largest insurance companies by market share in the country. After analyzing the data, we also reviewed each company’s coverage options, discounts, policy features and third-party rankings to compile a Bankrate Score for these companies. Our five-point scoring model can be used as a tool to help drivers quickly narrow down the best auto insurance companies for their needs.
For 20-year-olds looking for the best car insurance, getting quotes from major carriers Geico, State Farm, Progressive and Travelers might be a good starting place:
|Car insurance company||Bankrate Score||Average annual full coverage premium for 20-year-olds on their parents’ policy||Average annual full coverage premium for 20-year-olds on their own policy|
Geico has the lowest average rates for 20-year-olds of any provider on our list. In addition, the company might appeal to young drivers for its highly-rated digital tools. The company ranked in the top six on the 2022 J.D. Power U.S. Digital Experience Study for the shopping category, meaning that most customers are very satisfied with Geico’s digital service in that realm. The mobile app lets you pay bills, file claims, call for roadside assistance, view ID cards, make policy changes and more.
Geico is also known for having one of the most robust lists of discounts in the industry, with savings for federal employees, military members and safe drivers, among others. Geico carries an A++ (Superior) financial strength rating from AM Best, the highest available. Attractive coverage options from Geico include rideshare coverage, which could be important to individuals who use their vehicle to earn money. However, the company does not offer gap insurance, so if you need that coverage type to protect your auto loan, you may want to consider another option.
Learn more: Geico Insurance review
If you are looking for a well-established company with the weight of history behind it, State Farm might be a good choice. In addition to offering the second-cheapest average rates on our list, State Farm is the largest personal auto insurer in the country and sells its products through a network of 19,000 local agents.
Young drivers might be particularly drawn to State Farm’s Steer Clear telematics insurance program, which can save you money and help you learn safer driving habits. You may also be able to lower your premium by benefiting from a student discount or taking an accredited driver course. State Farm holds an A++ (Superior) financial strength rating from AM Best. However, the company does not offer gap insurance.
Learn more: State Farm Insurance review
Progressive’s auto insurance tools can save you both time and money. If you are on a budget, the Name Your Price tool can help you find coverage options that will fit in your financial plan. You can also compare quotes from other companies through Progressive’s website, which could help you determine if another company has a better price for the same level of coverage. If you plan to get your quote virtually and buy your policy online, Progressive might be a good option. The company offers savings for online quotes and purchases. However, you can also purchase Progressive’s car insurance through its national network of independent agents. Like our other top companies, Progressive has a strong balance sheet and is rated A+ (Superior) by AM Best. However, the company received a below-average claims satisfaction score from J.D. Power.
Learn more: Progressive Insurance review
Travelers has the highest average rates for 20-year-old drivers on their own policies on our list, but the company’s extensive list of optional coverage types might make up for the higher premium. You can add options like loan/lease gap coverage, new car replacement, accident forgiveness or ridesharing coverage to personalize your auto insurance policy. You might be able to lower your premium by earning good grades or maintaining a clean driving record. Travelers carries an A++ (Superior) financial strength rating from AM Best. However, Travelers has a greater number of customer complaints filed with the National Association of Insurance Commissioners (NAIC) for private passenger insurance.
Learn more: Travelers Insurance review
Cheapest car insurance for 20-year-old drivers
Because 20-year-olds pay relatively high average premiums for car insurance, finding a cheap provider might be high on your list of priorities. Fortunately, numerous carriers offer coverage lower than the national average cost of full coverage auto insurance for 20-year-old drivers. Because which company is cheaper for 20-year-olds will depend on whether or not the driver is on their own policy, we’ve broken these rates into two sections to present options for both scenarios.
Cheapest car insurance for 20-year-old drivers on their parents’ policy
|Car insurance company||Average annual minimum coverage premium||Average annual full coverage premium|
Cheapest car insurance for 20-year-old drivers on their own policy
|Car insurance company||Average annual minimum coverage premium||Average annual full coverage premium|
These are average premiums, but the price you pay for car insurance will depend on more than a dozen individual rating factors like the type of car you drive, how much you drive per year, coverage types and deductibles you choose, your claims history and motor vehicle record. You may pay more or less than the premium cited above.
How to save on car insurance for 20-year-olds
Generally, 20-year-olds can expect to pay relatively high car insurance costs compared with the national average, but there are ways that you can save on your premium.
- Shop around: One of the best ways to save is to get quotes from several companies so you can compare them. Most companies offer quotes online, or an independent insurance agent may be able to help you find insurers that offer a wide range of discounts and more affordable insurance options for 20-year-olds. It’s important when requesting quotes that you specify the same types and limits of coverage from each company.
- Take advantage of discounts: Most companies offer at least a few discounts to help lower your premium. Common discounts for 20-year-old drivers include going paperless, paid-in-full and good student discounts. Telematics discounts may also help lower your premium if you exhibit safe driving habits.
- Choose a higher deductible: Understanding your auto insurance deductibles is important. Deductibles are the out-of-pocket amount you are responsible for in the event of a vehicle damage claim. Increasing your deductible generally lowers your premium, but it also means you would have to pay more in an accident or a non-collision loss, like theft or fire.
- Consider the car you drive: Some cars are cheaper to insure than others. Most insurance professionals recommend that you get an insurance quote before you buy or lease a vehicle, so you can anticipate what you’d be paying for the car you’re thinking of choosing.
How to get the best car insurance for a 20-year-old
The first step to finding the best car insurance for your needs is to understand your situation. Take stock of your rating factors, including the type of car you have, any specific coverage types you are looking for, your driving history and what discounts you might qualify for. Then, get quotes from several companies that might fit your needs. That way, you can compare the quotes and companies and choose the option that is right for you.
The average annual rate for a 20-year-old driver on their parents’ policy with full coverage is $3,149, while it is $4,319 if they are on their own policy. Likewise, minimum coverage averages an annual $995 for 20-year-olds on their parents’ policies and $1,322 if they are on their own policy.
Frequently asked questions
Bankrate utilizes Quadrant Information Services to analyze 2023 rates for ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 20-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 2021 Toyota Camry, commute five days a week, drive 12,000 miles annually and have a renters insurance policy.
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. Hawaii rates indicate age is not a contributing factor.
Gender: The following states do not use gender as a determining factor in calculating premiums: California, Hawaii, Massachusetts, Michigan, North Carolina and Pennsylvania.