Insurance for first-time drivers

Car insurance may be an intimidating topic for first-time drivers. Many insurance companies consider new drivers riskier to insure due to their lack of experience, so they may see higher rates. However, comparing quotes and exploring coverage options may help new drivers find the coverage they need at a price they can afford. Bankrate’s insurance editorial team evaluated dozens of auto insurance companies to guide new drivers buying car insurance for the first time.

How much does car insurance cost for new drivers?

The average cost of car insurance is $2,014 per year, or $168 per month, for full coverage. Minimum coverage averages $622 per year or $52 per month. In many states, new drivers can typically expect to pay higher-than-average insurance premiums. Experience plays a large role in how much insurance is for a new driver; insurance companies usually consider new drivers to be riskier to insure due to their lack of know-how behind the wheel.

If you live in Hawaii or Massachusetts, insurance companies are not allowed to consider your age as a rating factor for auto insurance premiums, but carriers in Massachusetts are allowed to consider the number of years you have been licensed for. If you are a new driver but not a young driver, your rates will likely still be higher than the state average, but perhaps not as high as a newly-licensed teen.

How to choose car insurance for new drivers

Even if you are a new driver with natural driving abilities, you are still likely to make some mistakes as you gain experience driving. The longer you practice driving, you may see your rates come down, as long as you maintain a clean driving record. The good news is that you may be able to find more affordable rates by comparing quotes from different carriers and exploring discount opportunities. The following steps may help you narrow down the best company for your coverage needs.

Consider your individual priorities

Car insurance can be a very personal product, and the best company for you will likely depend on your individual circumstances. Car insurance companies use various rating factors to determine rates, including your vehicle type, driving record, ZIP code, location, mileage and, depending on your state, your age, credit history and gender. Your personal rating factors and coverage preferences will likely impact the best carrier for you. Comparing quotes from different carriers may help you find the best rates, but choosing the right carrier is usually about more than just rates.

If you’re unfamiliar with buying insurance, you may want a carrier that offers in-person agents for more personalized service. If you loan or lease your vehicle, your financial institution will likely require you to carry full coverage insurance. Narrowing down your priorities and comparing quotes from companies that meet these criteria may be the fastest way to find the best carrier for you.

Learn more: Guide to car insurance

Consider additional coverage options

Most states have a minimum level of required car insurance, but most insurance experts recommend carrying additional coverage if you can afford to do so. This usually includes collision and comprehensive coverage, also known as full coverage, which covers damage to your own vehicle in the event of an accident or other covered incident, like theft or vandalism. Most carriers also offer a handful of endorsements that may be useful if you have more unique coverage needs, like rideshare coverage if you drive for a rideshare company. Other common endorsements include:

• Uninsured and underinsured coverage: Required in some states, these coverage types cover you if you are hit by a motorist that is uninsured or does not have enough coverage to cover the damage to you and your vehicle.
• Medical payments coverage: Also required by some states, this covers the medical expenses of both you and your passengers in the event of an accident or other covered incident.
• Personal injury protection coverage: Required in no-fault states, 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.
• Gap insurance: If you have an auto loan, this optional coverage may cover the difference between the amount you owe on your vehicle and its actual cash value (ACV) in the event it is totaled or stolen and nonrecoverable.
• Roadside assistance coverage: If you find yourself suddenly unable to drive your car, roadside assistance coverage may come in handy. While exactly when it applies varies across providers, roadside assistance can usually help if you’ve run out of fuel, locked yourself out, popped a tire or need a tow.
• Accident forgiveness coverage: This supplementary coverage may help keep your rates low following your first at-fault accident. You may need to remain accident-free for a certain period of time to be eligible for this coverage type.

How to find cheap car insurance for first-time drivers

As new drivers typically see high rates, it may be tempting to choose a minimum coverage policy from the cheapest carrier you can find, but many insurance experts caution against this as it may leave you without the necessary financial protection in the event of an accident or other covered incident. The following steps may help you strike a balance between your budget and your coverage needs.

Shop around and compare quotes

Comparing quotes from various companies can be a tedious task, though it’s often worth the trouble. Different carriers use different rating algorithms to calculate rates, so quotes may be the only way to know for sure which carrier offers you the lowest rates for your circumstances. When comparing quotes, it may be helpful to request the same coverage options and limits so you can be sure you’re getting an accurate comparison between carriers.

Look for discounts

Most car insurance companies offer at least a handful of discounts that may help drivers save on their premiums. It may be worthwhile to ask about potential discounts during the quoting process to see if one carrier may be cheaper than another after the addition of discounts.

Discounts you might qualify for include:

• Defensive driving discounts: Car insurance companies may offer discounts for drivers who take a defensive driving course.
• Good student discounts: Many carriers offer discounts for full-time students who maintain a high grade point average.
• Multi-policy discounts: Pair up your car insurance with homeowners, renters or even boat insurance, and you may receive a discount.
• Multi-car discounts: Insuring more than one car with the same company may lower your premium with many companies.
• Payment discounts: Many companies offer discounts for policyholders who pay their premium in full or choose paperless billing.
• Telematics discounts: Telematics programs track your driving habits using either a small device installed in your vehicle or an app on your phone. Safe habits behind the wheel may earn you a reduced premium.

Discount types and amounts vary by company, so you may want to ask about potential discounts during the quoting process. When stacked together, you might be able to save a significant amount.

Maintain a clean driving record

Maintaining a clean driving record may be one of the biggest factors that could save you money on car insurance. Car insurance companies generally see drivers who avoid tickets and accidents as less risky to insure and may reward them with lower premiums. Discounts may also be available for drivers who go a set period of time without filing a claim.

The best car insurance for new drivers

The best car insurance company for new drivers likely depends on your personal circumstances and priorities, but Bankrate analyzed dozens of auto insurers to narrow down five that may offer the best coverage for new drivers. Our selections were made based on coverage options, discount availability, customer satisfaction scores, financial strength ratings, digital tools and more.

Frequently asked questions

• • Why do first-time drivers pay more for insurance?

    First-time drivers typically pay higher rates for car insurance because of their lack of experience behind the wheel. This may cause them to be more likely to be involved in accidents, therefore making them riskier to insure. Additionally, many first-time drivers are also young, which may increase their risk for accidents and tickets.

  • When do new drivers see their rates go down?

    For new drivers who are also young, rates tend to drop steadily as a driver ages into their 20s. If you’re a new driver but not a young driver, you may see your rates decrease after three to five years, provided you maintain a clean driving record. Not all states allow the use of age as a rating factor, and many other personal characteristics play a role in your rates, so if your rates remain high, you may want to evaluate your credit score, vehicle type or driving record.

  • What car should I buy if I want to pay less for auto insurance?

    Your vehicle type plays a role in your insurance premiums, and some makes and models are generally less expensive to insure than others. Luxury or sports cars may cost more to insure as they generally are more expensive and their drivers may be seen as more likely to engage in risky driving behavior. Cars with high repair costs, high theft rates and poor safety ratings may also see higher average premiums.

  • Can I save money as a first-time driver by staying on my parents' car insurance policy?

    In general, insurance costs for new drivers tend to be lower if they elect to stay on their parents’ policy. According to rate data from Quadrant Information Services, an 18-year-old driver on their parents’ policy pays an average of $3,837 per year for full coverage car insurance, while purchasing a policy on their own would cost a staggering $6,110 per year. While the rules may change depending on your insurance provider, you are usually allowed to remain on your parents’ policy as long as their home is your permanent residence.