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Best car insurance for young adults

Updated Mar 26, 2024
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This advertisement is powered by Coverage.com, LLC, a licensed insurance producer (NPN: 19966249) and a corporate affiliate of Bankrate. The offers and links that appear on this advertisement are from companies that compensate Coverage.com in different ways. The compensation received and other factors, such as your location, may impact what offers and links appear, and how, where and in what order they appear. While we seek to provide a wide range of offers, we do not include every product or service that may be available. Our goal is to keep information accurate and timely, but some information may not be current. Your actual offer from an advertiser may be different from the offer on this advertisement. All offers are subject to additional terms and conditions.

Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.

Best insurers for young drivers

Key takeaways

  • Young drivers have less experience behind the wheel. As such, they are more likely to get into accidents and file claims. This is why rates tend to be higher for younger drivers.
  • Young adults may want to get quotes from Auto-Owners, Geico, Nationwide, Progressive and State Farm due to low average premiums and robust coverage options.
  • Searching for carriers that offer discounts for which you may qualify could help lower young adult rates.

Bankrate’s research revealed that Auto-Owners, Geico, Nationwide, Progressive and State Farm are among the best car insurance companies for young drivers. We started our analysis by reviewing average premium data from Quadrant Information Services. Knowing that car insurance rates are increasing in 2023, we focused on finding companies with low average rates for young drivers. We also took coverage options, young driver-specific discounts, policy features and third-party ratings into consideration to help you find a carrier that offers affordable rates and adequate coverage.

To determine the average cost of car insurance for young drivers in the U.S., Bankrate analyzed data for drivers added to their parents’ policy, as well as drivers on their own policy. Remember, your rate may vary based on those factors and several others.

Best for discounts

Rating: 4.2 stars out of 5
4.2 Bankrate Score
JD Power: 888/1,000 AM Best: A++

Average annual premium

$ 1,361 for full coverage
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Auto-Owners is one of the best insurers for young drivers if you want a variety of discount options. The company offers three dedicated savings programs for young drivers, as well as a slew of other discounts that could help you lower your premium.

Auto-Owners offers young drivers three distinct savings opportunities. If you’re a full-time student with “B” or better average grades, you may qualify for a good student discount. Students who are away at school over 100 miles from home and do not have a vehicle with them could also be eligible for the student-away-at-school discount. Auto-Owners offers a Teen Monitoring discount, as well, which uses your vehicle’s GPS system to evaluate driving habits.

Learn more: Auto-Owners Insurance review

Best for low rates

Rating: 4.3 stars out of 5
4.3 Bankrate Score
JD Power: 871/1,000 AM Best: A++

Average annual premium

$ 1,353 for full coverage
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Geico offers competitive car insurance rates for young drivers with a few years of experience. The company also offers a long list of discounts, including student discounts, that could help you lower your premium.

Recent college grads might also earn discounts for alumni association membership and fraternity or sorority affiliation. Young adults who are active-duty members of the U.S. Armed Forces could earn up to a 15 percent discount, along with additional savings when deployed.

Learn more: Geico Insurance review

Best for customized policies

Rating: 4 stars out of 5
4 Bankrate Score
JD Power: 875/1,000 AM Best: A+

Average annual premium

$ 1,422 for full coverage
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If you are looking for an auto insurer with plenty of options for personalization, Nationwide might be a good fit. The company offers numerous coverage add-ons, like roadside assistance and gap insurance, to help create personalized car insurance for teens and young drivers.

Young adults may be able to save money on auto insurance when they enroll in Nationwide’s SmartRide program. The program uses an app to track acceleration, braking, idle time, mileage and nighttime driving. Drivers get a 10 percent discount on certain coverage types just for signing up for this telematics program and could earn up to a 40 percent discount on certain coverage types depending on their driving habits.

Learn more: Nationwide Insurance review

Best for mobile experience

Rating: 4.4 stars out of 5
4.4 Bankrate Score
JD Power: 870/1,000 AM Best: A+

Average annual premium

$ 1,642 for full coverage
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Although its premiums aren’t the lowest on our list, Progressive may appeal to young drivers who prefer to handle their insurance needs digitally. Additionally, Progressive offers several discounts which could help you get a lower rate.

Progressive’s robust mobile app includes options to pay your bill, view your policy information, request changes, call for roadside assistance, file and track a claim and start a new quote. The company’s website is also robust, with an online portal for customers and plenty of information about Progressive’s products.

Learn more: Progressive Insurance review

Best for local agents

Rating: 4.2 stars out of 5
4.2 Bankrate Score
JD Power: 891/1,000 AM Best: A++

Average annual premium

$ 1,480 for full coverage
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If you like working with a local agent, State Farm might be a good choice for auto insurance for young adults. The company has a network of 19,000 agents throughout the U.S. who can help you with your auto insurance needs.

Young people often need help navigating the challenges of university life or leaving the nest to live on their own. State Farm makes life a little easier for young adults with an exceptional roadside assistance program. This covers battery jump starts, fuel delivery, locksmith service, towing and up to one hour of roadside mechanic’s labor.

Learn more: State Farm Insurance review

How much is car insurance for young adults?

A driver’s age is one of the biggest factors to affect rates, except in Hawaii or Massachusetts, where age is not allowed to be used as a factor for calculating insurance premiums. While teens tend to pay the highest rates, drivers between the ages of 20 and 25 are still paying hefty average premiums. At age 20, for example, drivers pay 56 percent more for full coverage than the national average premium of $2,014 per year. By age 25, though, average insurance rates fall significantly and tend to change less drastically from year to year.

Age Average annual premium for minimum coverage Average annual premium for full coverage
Age 20 $995 $3,149
Age 21 $868 $2,763
Age 22 $955 $3,164
Age 23 $896 $2,985
Age 24 $850 $2,837
Age 25 $747 $2,473
Rates for ages 20-22 are for the insured on a parent’s policy and reflect the total cost of three drivers and one vehicle. Rates for ages 23-25 reflect the young drivers on their own policy, insuring one vehicle.

Average car insurance costs for young drivers by state

Location is another critical factor in determining auto insurance premiums. Every state has different insurance laws, including different minimum coverage requirements, which can impact the rates set by every auto insurance company. Additionally, the risk of getting into an accident may vary by location, including your state, city or even ZIP code.

The table below illustrates the average annual full coverage premium for young adults, analyzed by state.

State 20-year-old 21-year-old 22-year-old 23-year-old 24-year-old 25-year-old
Alabama $2,857 $2,585 $3,055 $2,904 $2,743 $2,298
Alaska $3,072 $2,644 $3,148 $2,942 $2,813 $2,359
Arizona $2,916 $2,673 $2,902 $2,727 $2,605 $2,214
Arkansas $3,008 $2,577 $2,955 $2,818 $2,683 $2,429
California $3,539 $3,205 $3,478 $3,301 $3,093 $2,884
Colorado $3,566 $3,237 $3,386 $3,195 $3,048 $2,591
Connecticut $2,338 $2,088 $2,618 $2,452 $2,319 $2,011
Delaware $3,198 $2,771 $3,314 $3,154 $3,017 $2,531
Florida $5,017 $4,241 $4,944 $4,684 $4,531 $4,018
Georgia $3,287 $2,885 $3,330 $3,141 $2,994 $2,646
Hawaii* $1,332 $1,309 $1,327 $1,327 $1,327 $1,327
Idaho $1,725 $1,507 $1,864 $1,769 $1,706 $1,433
Illinois $2,938 $2,599 $3,103 $2,890 $2,745 $2,289
Indiana $1,991 $1,763 $2,096 $2,036 $1,907 $1,603
Iowa $1,940 $1,744 $2,070 $1,979 $1,907 $1,620
Kansas $2,810 $2,549 $2,923 $2,814 $2,730 $2,317
Kentucky $3,261 $2,826 $3,569 $3,414 $3,229 $2,701
Louisiana $4,443 $4,003 $4,622 $4,365 $4,144 $3,593
Maine $1,576 $1,303 $1,622 $1,551 $1,488 $1,234
Maryland $3,285 $2,846 $3,266 $3,009 $2,804 $2,436
Massachusetts* $1,964 $1,838 $1,661 $1,602 $1,489 $1,439
Michigan $4,770 $4,090 $4,368 $4,054 $3,878 $3,100
Minnesota $2,505 $2,268 $2,728 $2,574 $2,471 $2,139
Mississippi $2,617 $2,304 $2,786 $2,654 $2,533 $2,240
Missouri $3,020 $2,657 $3,167 $3,013 $2,877 $2,393
Montana $2,949 $2,417 $3,099 $2,886 $2,784 $2,159
Nebraska $2,336 $2,090 $2,549 $2,431 $2,352 $1,973
Nevada $4,540 $4,054 $4,460 $4,108 $3,947 $3,419
New Hampshire $2,001 $1,667 $2,145 $2,050 $1,949 $1,657
New Jersey $2,769 $2,452 $2,962 $2,743 $2,602 $2,244
New Mexico $2,312 $2,132 $2,493 $2,386 $2,276 $1,991
New York $4,651 $4,020 $4,642 $4,335 $4,135 $3,661
North Carolina $1,669 $1,604 $1,610 $1,591 $1,557 $1,528
North Dakota $1,836 $1,744 $1,979 $1,841 $1,765 $1,570
Ohio $1,991 $1,766 $2,179 $2,037 $1,897 $1,630
Oklahoma $3,017 $2,772 $3,085 $2,902 $2,761 $2,429
Oregon $2,146 $1,974 $2,207 $2,088 $1,996 $1,735
Pennsylvania $3,441 $2,886 $3,383 $3,191 $3,011 $2,438
Rhode Island $2,976 $2,579 $3,075 $2,836 $2,725 $2,340
South Carolina $2,283 $1,998 $2,449 $2,321 $2,215 $1,919
South Dakota $2,180 $2,112 $2,293 $2,152 $2,083 $1,831
Tennessee $2,332 $2,094 $2,427 $2,269 $2,102 $1,855
Texas $3,379 $2,783 $3,210 $3,031 $2,867 $2,439
Utah $2,592 $2,265 $2,501 $2,342 $2,206 $1,853
Vermont $2,070 $1,645 $1,848 $1,746 $1,692 $1,345
Virginia $2,348 $1,978 $2,502 $2,345 $2,224 $1,872
Washington $2,302 $2,045 $2,389 $2,223 $2,113 $1,816
Washington, D.C. $3,160 $2,948 $3,252 $3,039 $2,854 $2,497
West Virginia $2,370 $2,128 $2,550 $2,395 $2,241 $1,927
Wisconsin $1,985 $1,831 $2,062 $1,951 $1,860 $1,615
Wyoming $2,297 $2,126 $2,584 $2,408 $2,308 $1,862
*Hawaii and Massachusetts prohibit using age as a rating factor, but other factors may apply that cause rates to fluctuate. **Rates for ages 20-22 are for the insured on a parent’s policy and reflect the total cost of three drivers and one vehicle. Rates for ages 23-25 reflect the young drivers on their own policy, insuring one vehicle.

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Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.

Advertising Disclosure
This advertisement is powered by Coverage.com, LLC, a licensed insurance producer (NPN: 19966249) and a corporate affiliate of Bankrate. The offers and links that appear on this advertisement are from companies that compensate Coverage.com in different ways. The compensation received and other factors, such as your location, may impact what offers and links appear, and how, where and in what order they appear. While we seek to provide a wide range of offers, we do not include every product or service that may be available. Our goal is to keep information accurate and timely, but some information may not be current. Your actual offer from an advertiser may be different from the offer on this advertisement. All offers are subject to additional terms and conditions.

How are rates determined for young drivers?

Auto insurance rates for young adults are calculated in the same way as they are for older drivers. Several rating factors determine car insurance premiums, including:

  • Age: Drivers under 25 have less experience and don’t typically have the same level of financial stability as older drivers, which may make them more likely to get into accidents and file claims. That leads to higher insurance costs in most states, though Hawaii and Massachusetts state regulations do not permit insurance companies to use age as a rating factor.
  • Vehicle make and model: The type of car you drive, particularly how much the car is worth and how much it will cost to repair, influences premiums. Older cars with lower values and those that are cheaper to fix after an accident are usually cheaper to insure than others.
  • Credit: Most states allow insurance carriers to use your credit-based insurance score when calculating your policy rate. People with poor credit typically pay much higher rates than consumers with good credit. Note that California, Hawaii and Massachusetts ban the use of credit as a factor in determining insurance rates, while car insurance companies in Michigan cannot use your actual credit rating but can use factors that go into your credit rating.
  • Gender: Males usually pay higher rates than females pay for car insurance, even if they have clean driving records. Men are statistically more likely to get into accidents than women, and those accidents tend to be more severe. California, Hawaii, Massachusetts, Michigan, North Carolina and Pennsylvania ban the use of gender as a rating factor, though.
  • Location: If you live in an area with a high likelihood of accidents or damage caused by natural disasters, theft or vandalism, you may pay more for coverage. Additionally, every state has different insurance laws, which can affect premiums.
  • Mileage: The more you drive, the more likely you will have an accident due to being on the road more often. People who only use their cars occasionally may pay lower rates than people who are on the road more often.
  • Types and amount of coverage: The types and level of coverage you buy also impact the premiums you pay. Lower levels of coverage and buying only liability protection will usually be cheaper than buying collision and comprehensive insurance. Keep in mind that lenders will typically require you to buy collision and comprehensive (aka full coverage), though, and most insurance experts recommend purchasing more than the minimum amount required to better protect your finances.
  • Deductible: Your deductible for certain coverage types will affect how much you pay, too. Higher deductibles mean lower premiums, but you will pay more out of pocket after an accident, so you need to be prepared for that risk.

Because insurers weigh these variables differently when calculating premiums, your quote may vary from company to company. That said, it can be helpful to get several quotes before settling on an auto insurer.

Car insurance discounts for young drivers

Almost every auto insurance company offers discounts to drivers, with some discounts aimed specifically at younger drivers. Finding a company that offers the most discounts that apply to your circumstances may be the best way to get cheap car insurance.

  • Multi-car discounts: Most auto insurers offer a slight discount when you add multiple cars to a single policy. It does not fully offset the cost of insurance for each vehicle, but overall, the vehicles are cheaper to insure together.
  • Multi-policy discount: For drivers who rent an apartment and own a car, bundling auto and renters insurance can be one way to make insurance more affordable.
  • Alumni association discounts: Many car insurance companies offer alumni association discounts for recent college graduates. You may need to ask an agent for details.
  • Good student discount: Discounts for students are among the most common discounts for young drivers. You can usually earn the discount if you’re a full-time high school or college student and maintain a minimum GPA.
  • Young driver safety training: Many companies offer discounts to students who have taken a driver education class or an approved driver training course. These courses teach defensive driving and can help reduce the likelihood and severity of accidents.
  • Usage-based rating discounts: If you don’t drive much, you might be able to get a discount based on how often you drive. These are relatively new programs and rely on a mobile app or plug-in device to track your mileage and driving habits, such as acceleration, braking and speed. Good driving habits can land you a bigger discount.
  • Distant student discount: For students who attend school far away, you may be able to land a discount if you leave your car at home. You typically must be listed on your parents’ policy to take advantage of this discount.

Frequently asked questions

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2023 rates for all 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 20-year-old through 25-year-old male and female drivers 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 and drive 12,000 miles annually. The drivers are renters on their own insurance plans except for distant student discount rates, in which case the drivers are on their parents’ plan.

These are sample rates and should only be used for comparative purposes.

Age: Rates were calculated by evaluating our base profile with the ages 20-40 applied. Depending on age, drivers may be a renter or homeowner. Rates for ages 20-22 are for the insured on a parent’s policy and reflect the total cost of three drivers and one vehicle. Rates for ages 23-25 reflect the young drivers on their own policy, insuring one vehicle.

Due to state regulations, age is not a contributing rating factor in Hawaii and Massachusetts.

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Written by
TJ Porter
Contributor, Personal Finance

TJ Porter is a contributing writer for Bankrate with eight years of experience writing about finance.  TJ writes about a range of subjects, from budgeting tips to bank account reviews.

Edited by Editor, Insurance
Reviewed by Senior wealth advisor at Versant Capital Management