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The cheapest car insurance for 21-year-olds can be found at USAA for $134 per month or $1,609 per year for full coverage policies
Cheap Car Insurance For Old Cars
Written by: Daniel Robinson, Written by: Daniel Robinson Writer Daniel is a team guide writer and has written for a number of automotive news and marketing firms across the US, UK and Australia, specializing in auto finance and car care topics. Daniel is the authority on the Guide Team for auto insurance, loans, warranty options, auto repair and more.
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Edited by: Rashawn Mitchner, Edited by: Rashawn Mitchner Editor-in-Chief Rashawn Mitchner is a guide team editor with over 10 years of experience covering personal finance and insurance topics.
Finding cheap auto insurance as a 21-year-old can be difficult. Monthly and annual premiums tend to be expensive because younger drivers pose a greater risk to insurance companies. In this article, we at the guide team rank the best car insurance for 21 year olds and show you how to get affordable rates.
Cheapest Car Insurance for Young Adults Car Insurance Discounts Best Car Insurance Companies Average Cost of Car Insurance
The guide team is dedicated to providing you with reliable information to help you make the best possible decision about insuring your vehicle. Because consumers rely on us to provide objective and accurate information, we’ve created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to rate companies based on a wide range of ranking factors. After 800 hours of research, the end result was an overall score for each provider, with insurers with the most points at the top of the list.
Best Car Insurance Companies (updated [gfc_globals Field=
According to our estimates, 21-year-olds pay an average of $2,786 per year or $232 per month for full coverage car insurance. That’s about 56% more expensive than the average for 35-year-old drivers, which is $1,785 a year or about $149 a month. Typically, auto insurance rates are much more expensive for 21-year-olds than for older drivers.
Car insurance costs for 21-year-old drivers are determined based on several factors, including driving history, location and credit score. Gender also plays a role in calculating your premiums, especially when you’re a teenager or young adult. For example, young men have disproportionately higher accident rates, causing them to pay more for insurance than young women. However, some states do not allow insurance companies to use gender in calculating insurance premiums.
Compared to older drivers, 21-year-olds have less driving experience and are more likely to be involved in accidents. Car insurance companies compensate for these risk factors by charging higher rates to this age group.
According to the AAA Foundation for Traffic Safety, drivers between the ages of 20 and 24 were 74% more likely to be involved in a crash than drivers in their 30s in 2015. You can see crash rates for each age group below.
Affordable Car & Auto Insurance
High-risk drivers pay higher prices on average, and young drivers tend to fall into this category. Below you can see how the average costs by year correlate with the demolition data above.
The cheapest car insurance for 21-year-olds is USAA, which offers average rates of $134 per month. However, USAA is only available to members of the military, veterans and their immediate families. Geico is the cheapest company available to any 21-year-old driver, with an average rate of $154 per month. Other affordable companies include Auto Owners Insurance, Erie Insurance and Nationwide.
The best car insurance for 21 year olds isn’t necessarily the cheapest, but cheap rates definitely help. Below you can see how 11 popular providers rank on the price of car insurance for 21 year olds.
*Car insurance estimates are based on full coverage policies with $50,000 bodily injury per person, $100,000 bodily injury per accident, $50,000 property damage per accident and a $500 deductible for collision coverage and comprehensive coverage.
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Location is one factor that affects how much you pay for car insurance, and prices can vary significantly by state. Below are the cheapest car insurance companies in each state for full coverage for 21-year-olds. According to our estimates, USAA and Geico are the cheapest providers in many states.
While 21-year-olds pay $232 a month on average across the country, drivers in some states pay much less. Insurance in North Carolina averages $129 a month for the age group, for example.
Whether due to population density or insurance regulations, some states are much more expensive for 21-year-olds than others. Michigan, Connecticut and Massachusetts top the list.
Our top five picks for the best car insurance for 21-year-olds are Geico, USAA, State Farm, Nationwide, and Auto-Owners Insurance. When comparing car insurance companies, our team considers cost, reputation, coverage, availability and customer experience. We found these companies to be affordable on average for young adult drivers.
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Geico is our top pick for the best car insurance for 21 year olds. Its car insurance rates for 21-year-olds are around 34% cheaper than the market average for that age group. Geico also offers a 15% discount for students and a discount of up to 22% for those who have driven for five years without an accident.
The company has been around since 1936 and has an A+ rating from the Better Business Bureau (BBB).
USAA offers the cheapest car insurance on average for 21-year-olds, with rates about 42% below the market average. However, we didn’t call it the best auto insurance for 21-year-olds because it’s not available to everyone. You can only qualify if you are enrolled in the military, a veteran, or have a parent who is a USAA member.
Not only does USAA have low rates for 21-year-olds, it’s also known for reliable customer service. The company has an A+ rating from the BBB and has earned the highest rating in nearly every region of the country in J.D. Power 2022 to the American Auto Insurance Study ℠.
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State Farm is another national provider that offers affordable car insurance premiums for 21-year-old drivers. Our estimates show that average State Farm rates are about 17% cheaper than the national average for this age group.
State Farm also offers discounts for younger drivers, including a generous student discount of up to 25% for maintaining a B average. Younger drivers can also save money with the State Farm Steer Clear® program, an app-based driving course for drivers under 25.
On average, 21-year-old drivers save about 23% on Nationwide compared to the national average. One thing that makes Nationwide unique is that it offers two usage-based telematics insurance options. SmartRide® can award discounts of up to 40% based on a person’s driving habits by tracking acceleration, braking, night driving and more. Another option, SmartMiles®, is a pay-per-mile insurance program that can help people who don’t drive often save money.
Nationwide has a strong reputation in the industry, earning an A+ financial strength rating from AM Best and an A+ rating from the BBB.
New Car Insurance
Another good car insurance company for 21 year olds is Auto Owners. Our estimates show that 21-year-olds pay around 26% less than the national average for car owners. The company offers a good student discount of up to 20% and a discount for students who are away at school and leave their cars at home. However, Auto-Owners is only available in 26 states.
Fortunately, age isn’t the only thing that determines car insurance rates. There are several things you can do to find cheap rates for the best car insurance for 21 year olds. We recommend that you think about your level of coverage and deductible, comparing providers, keeping a clean driving record and finding discounts.
To save money, you can reduce the amounts covered by options such as comprehensive and collision insurance. You can also opt out of full coverage and only get minimum levels of coverage for bodily injury and property damage. However, make sure you can handle any costs that your minimum coverage won’t pay if you’re at fault for the accident.
You can lower your payments by raising your deductible, which is the amount you pay out of pocket if you file a claim. However, make sure you can afford the deductible.
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One of the easiest ways to get a better rate is to compare companies. We recommend that you compare rates every time your car insurance policy is up for renewal. The cheapest companies for teenage drivers aren’t necessarily the cheapest for drivers in their early 20s, so it pays to check prices as you get older.
Getting a speeding ticket or causing an accident are surefire ways to get higher rates, and 21-year-old drivers are already paying more than average. A clean driving history keeps your rates as low as possible.
Not all companies offer the same discounts or the same savings on similar discounts. In our picks above for the best car insurance for 21-year-olds, you can see that State Farm, Geico, and Auto-Owners offer different discount amounts for good students.
Compare deals online to find the right discounts for your situation. You can also work with an insurance agent to make sure you find any applicable discounts.
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Another way for 21-year-old drivers to save money
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