Insurance for First-Time Drivers

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Affordable car insurance for first-time drivers can be hard to find. Most insurance companies consider new drivers to be so risky that rates are often three to four times higher than rates for other drivers.

So you don’t choose the wrong policy or overpay, here’s what you need to know about insurance for first-time drivers.

Car insurance for new drivers

As a new driver, you’re not as experienced as other drivers who have been on the road for multiple years. No matter how much of a natural you are, you’re going to make mistakes. Insurance companies know this, which is why they charge more for new drivers.

However, even though you’re going to be paying more, that’s not enough of a reason to only purchase your state’s bare minimums. Should you injure or kill someone, your state’s minimum liability requirements aren’t going to cover all of your expenses, which is something many new drivers don’t realize. Liability doesn’t cover everything. It only covers a certain amount of financial responsibility.

For example, take a look at Virginia’s minimum liability requirements. In Virginia, you are required to have a 25/50/20 policy, which means your policy must provide:

  • A maximum of $25,000 per person for bodily injuries sustained in an accident
  • A maximum of $50,000 per accident for bodily injuries (meaning the maximum your insurance company will pay per accident for physical injuries you caused regardless of how many people were involved)
  • A maximum of $20,000 for property damage per accident (which includes cars, signs, fences, homes, etc.)

It seems like a lot of money, but it’s not. Consider that the base model of a 2020 Ford Explorer costs around $33,000, and it’s apparent the property damage coverage alone could easily exceed your policy limits. When something like this happens, you’ll be expected to foot the remainder of the bill. To protect yourself against something like this, it’s always a good idea to purchase as much liability as you can comfortably afford.

Additional coverage options to consider

As a new driver, you should also consider:

  • Comprehensive coverage: This covers your car from such things as vandalism, theft, fire, hail, and deer.
  • Uninsured and underinsured coverage: This covers you if you are hit by an uninsured or underinsured motorist— meaning it will help cover your medical bills and possibly car’s repair or replacement costs (depending on where you live).
  • Collision coverage: This covers you should you hit another car, sign post or property, such as a fence or gate.
  • Medical payments coverage: This covers the medical expenses of both the driver and passengers in the event of an accident.
  • Personal injury protection: This also covers medical expenses after an accident, but it may also help with things like loss of income and childcare. Personal injury protection is not available in all states.

These additional coverages can give you more peace of mind on the road.

How to find cheaper car insurance for first-time drivers

Finding cheap auto insurance for new drivers may take time and patience. You’ll want to shop around first and find the companies offering the best rates. From there, you’ll also want to find companies offering a range of discounts. Most auto insurers have a page dedicated to discounts. If you can’t find it, speak with a customer service representative.

Discounts you should look for include:

  • Defensive driving course: Most insurance companies reward continued driver education courses.
  • Clean driving record: Keep your driving record clean of speeding tickets and accidents to get this discount.
  • Security system: Location devices, alarms and other security features that protect your vehicle can help you save money.
  • Good student: Maintain a 3.0 grade point average, and your monthly insurance costs will go down because being a good student and a good driver often go hand in hand
  • Family policy: Teenagers who join their parents’ policy often receive lower rates
  • Multi-policy: Pair up your car insurance with homeowners, apartment or even boat insurance to receive a discount
  • Multi-car: insuring more than one car with the same company will lower the premium with many companies
  • Full pay: pay your premium in full each year to save money

The amount of each discount varies with each company, but the savings are always worth pursuing. When stacked together, you might be able to save a significant amount.

Laura Adams, an insurance expert, says “Another way to make car insurance affordable for new drivers is to enroll in usage-based insurance (UBI). These programs use technology to evaluate your driving behaviors and patterns, such as how fast you turn and hit the brakes, your speed, mileage, and the times of day you’re on the road. When the data shows that you’re a safe driver, you qualify for discounts that could be as high as 50 percent, depending on your insurer.”

The best insurance for new drivers

Getting the cheapest car insurance for new drivers is all about finding the right company. We recommend, the following four companies:

  1. Geico: Geico offers lower rates than most other companies for new drivers. Plus, there are a wide range of discounts to help you get your premium to where you need it.
  2. Nationwide: Nationwide is more forgiving when it comes to premiums for new drivers. Nationwide also has an amazing app for making claims after an accident, and it offers about every discount imaginable.
  3. State Farm: On average, State Farm charges more for new driver, but it’s not far behind the others on our list. Like Nationwide, State Farm has an intuitive app to make changes to your policy, report an accident and make payments. Plus, they offer a wide range of discount options to help you lower your premium.
  4. USAA: Available to active and former military (as well as their immediate family), USAA offers some of the best rates discounts in the business. USAA also routinely scores a five out of five for customer satisfaction with J.D. Power.

Cheaper car insurance for first-time drivers may be found with a local company, but national companies generally offer more discounts and incentives for joining.

The cost of insurance for new drivers

A teenager who’s just getting on the road can expect to pay around a few thousand a year until they are older.

Factors that influence what drivers pay include:

  • Car type
  • Car age
  • State
  • Location (for theft and accident reports)
  • Miles driven per year for work or school
  • Deductible amount
  • Discounts

Frequently asked questions

Why do first-time drivers pay more for insurance?

The short answer is statistics. First time drivers are more likely to make mistakes, which is the biggest reason car insurance for new drivers is so expensive. New drivers are often guilty of speeding, texting and failing to yield. Because of these things, they get into a lot of accidents. Insurance companies consider them a higher risk, and therefore charge more for them to have or be on a policy.

When do new drivers see their rates go down?

Most new drivers see their rates go down once they reach their twenties, or after a couple years of clean driving. Insurance expert Laura Adams says, “As you get older and gain years of experience behind the wheel, your car insurance rates should come down.”

So age and years on the road are two of the biggest factors that influence the rates for new driver insurance. However, if you want to know when you can realistically expect your rates to go down, ask your insurance provider.

Which is cheaper for new drivers to insure— a new car or an old car?

Insurance for new drivers is expensive, so it’s best to pair them up with the best car to keep your premium as low as possible. Older cars are generally cheaper to insure because they don’t cost as much to replace. However, consider the car’s safety rating before you go looking for an older car. Remember: as a new driver, you are statistically more likely to get into an accident. You want a healthy balance of safety and savings.