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For young drivers, car insurance can be a major expense. In fact, Bankrate’s analysis of rate data from Quadrant Information Services shows that drivers under the age of 25 pay significantly higher premiums than their older counterparts. This can make it difficult for young adults to afford their own insurance policy, especially if they’re just starting out in their careers. Fortunately, there is an option for young drivers to save money on car insurance – by staying on their parents’ policy. However, insurance companies typically require policyholders to live at the same address, meaning if the young adult moves out or gets their own vehicle, they may need to purchase their own policy. That said, young drivers, whether they’re on their parents’ policy or buying their own, can find car insurance savings with some of Bankrate’s tips and strategies.

When you can be on your parents’ car insurance policy

Being on your parents’ car insurance policy is possible and can also be beneficial in many scenarios. Here are some situations where you can be on your parents’ auto insurance policy:

  • You co-own the car with your parent and live at home with them: If you and your parent co-own the car, you can be listed on the same insurance policy. This arrangement is quite common, especially for younger drivers who are not yet financially independent.
  • Your parents own the car, and you live with them: If your parents own the car you’re driving and you live at the same address, you can be on their auto insurance policy. You’d be considered a covered driver for that vehicle.
  • You are a college student and drive your parents’ car when you are home: If you’re a college student who drives your parents’ car only when you’re home for holidays or vacations, you can typically remain on their policy as a covered driver.
  • You are a college student and drove your car to school: If you drove your car with you to college, most insurers will allow you stay on your parents’ policy. As long as your primary residence is still your parents’ address, your insurer will likely allow you stay on your parents’ insurance. However, this may not be the case if you attend school out of state.

In most instances, you will be allowed to be on your parents’ car insurance policy if you live with them. This even applies if you are married: as long as you and your spouse live in your parents’ household, it’s possible to be added to their car insurance policy. To do so, your parents would need to add the vehicle to their policy, which will likely cause rates to increase. However, depending on the insurer, the rate raise may still be cheaper than the cost of a whole new policy.

When you cannot be on your parents’ auto insurance

While, unlike other forms of insurance, there is no strict age limit to how long you can stay on your parents’ policy, there are a few instances where it is not allowed:

  • You own your car: If you own your car outright, you’ll usually need to have your own auto insurance policy. This is especially true if you don’t live with your parents.
  • You co-own a vehicle with your parents but do not live at home: If you do not live at home with your parents but co-own a vehicle with them, your parents may need to be added to your insurance policy. Their driving profiles would not influence your insurance rate, but as co-owners, their names would need to be on your insurance policy paperwork.
  • You no longer live at home: If you’ve started renting your own apartment, whether it’s near your parents’ house or out of state, you will likely need to purchase your own policy.
  • You do not live with your parents, but they own your car: Even if your parents own your car, if you do not live with them, you may not be able to be on their auto insurance policy. Most insurance companies require the primary driver of the vehicle to have their own insurance policy. If your parents own your car, they will likely need to added as non-drivers on your insurance policy. Like with co-ownership, your parents’ driving profiles would not usually affect your insurance rate.
  • You are on your own financially: If you’re financially independent and don’t live with your parents, you’ll generally need your own auto insurance policy. This is to ensure you’re responsible for any incidents that occur while you’re driving.

Should you stay on your parents’ insurance policy?

Staying on your parents’ insurance policy can be a financially sound decision, especially for young drivers under 25, as it is typically more cost-effective than getting your own policy. By remaining on your parents’ policy, you can take advantage of lower rates thanks to their more extensive driving record and potential for more significant insurance discounts. Plus, staying on a parent’s policy can help young drivers establish a coverage history, which could lead to discounted rates in the future.

Comparing the cost of individual and parents’ car insurance policy

To illustrate just how much young drivers can save by remaining on their parents’ policies, Bankrate has analyzed rate data from Quadrant Information Services. The table below displays average full coverage car insurance rates for drivers aged 18 to 21 on their own policies versus those on their parents’ policies. Drivers on their own policies are renters with good credit and a clean driving record.

Age Full coverage on own policy Full coverage on parents’ policy Savings from remaining on parents’ policy
18-year-old $7,499 $4,797 $2,702
19-year-old $5,946 $4,197 $1,749
20-year-old $5,443 $3,962 $1,481
21-year-old $4,333 $3,506 $827

How long can I be on my parents’ car insurance?

There’s no set age limit for how long you can stay on your parents’ auto insurance policy. However, insurance companies typically require that you live at the same address as your parents if you’re an adult on their policy. If you move out or purchase your own vehicle, you’ll likely need to get your own insurance policy.

Is it cheaper to be on my parents’ car insurance?

Generally, it is cheaper for younger drivers, particularly those under 25, to stay on their parents’ car insurance policy. The average cost of car insurance for teen drivers is significantly higher than the average for American drivers as a whole. By staying on a parents’ plan, young drivers can enjoy lower rates. However, once drivers turn 25, their rates generally start to decrease, making the prospect of getting their own policy more financially feasible.

Tips to lower car insurance rates for teens on their parents’ policy

There are several strategies to lower car insurance costs for teen drivers on their parents’ policy:

  • Good student discount: Many insurers reward good grades with a discount on car insurance. How much you can save will depend on your insurer.
  • Distant student discount: If your teen elected not to bring their car to college, you may be able to lower their insurance rate with a distant student discount. You may also see this referred to as an “away-from-home” discount.
  • Choose a safer vehicle: Make and model can have a significant impact on insurance rates. Before you get your teen their first car, you might want to look up the vehicle identification number (VIN) on any potential vehicles to get insurance quotes. Vehicles equipped with safety features may sometimes be cheaper to insure.
  • Enroll in a safe driving course: Some insurers offer defensive driving courses specifically for teens. Upon completing the course, you may earn an insurance discount.
  • Consider a telematics program: A telematics device tracks your driving habits and reports them to your insurance company. Good, safe driving habits are typically rewarded with insurance discounts.

Frequently asked questions

    • While the best car insurance company will be different for each driver, Bankrate has identified a couple of companies that stand apart from the rest. Drivers looking for top-notch customer service may want to get a quote from Amica, as it won the 2024 Bankrate Award for Best Car Insurance Company for Customer Experience and tied for Best Car Insurance Company Overall. Geico is another top contender, scooping up three impressive Bankrate Awards: Best Car Insurance Company Overall, Best Budget Auto Insurance Company (in a tie) and Best Car Insurance Company for Young Drivers.The better question to ask is “what is the best car insurance company for me?” To find out, you’ll first need to hone in on what is most important to you, whether it’s cheap rates, local agencies near you, digital policy management options or something else entirely. Once you have a better idea of what you need from your insurer, look at Bankrate’s list of best car insurance companies to help you get the ball rolling.
    • In general, yes. According to Bankrate’s analysis of rate data from Quadrant Information Services, car insurance rates tend to trend downward from ages 25 to 60. Generally speaking, the more driving experience a driver has behind the wheel, the less risk they pose to their insurance company. This is especially true for drivers in that age group who do not wrack up driving infractions and remain claims-free. If you want to find the cheapest car insurance for you, it’s a good best practice to request quotes from several companies for the same coverage types and levels.
    • It mostly depends on custody arrangements and the child’s primary residence. In most cases, the custodial parent adds the child to their policy when the child starts driving. The non-custodial parent should verify with their insurer if they need to do the same. In joint custody cases where the child has regular access to cars at both homes, it’s likely that both parents will need to add the teen to their insurance policies. To be sure, it’s wise to check with your respective insurance carriers for their requirements.


Bankrate utilizes Quadrant Information Services to analyze January 2024 rates for ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a 40-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 2022 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 18-21 (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 due to state regulations.