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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 Insurance Young Female Drivers
Written by: Daniel Robinson Written by: Daniel Robinson Writer Daniel is a Guide Group writer and has written for numerous auto news websites and marketing companies across the US, UK and Australia, specializing in auto finance and car care topics. Daniel is a leading group authority on auto insurance, loans, warranty options, auto services and more.
Insurance For Young Drivers
Edited by: Rashawn Mitchner, Edited by: Rashawn Mitchner Managing Editor Rashawn Mitchner is a Guides team editor with more than 10 years of experience covering personal finance and insurance topics.
Finding cheap car insurance as a 21-year-old can be difficult. Younger drivers are more vulnerable to insurance companies, so monthly and annual premiums are more expensive. 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.
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The Guide team is dedicated to providing 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 created a comprehensive rating system to compile ratings of the best car insurance companies. We collected data from dozens of auto insurance providers to rank companies on a wide range of rating factors. After 800 hours of research, the end result was an overall ranking for each provider, with the highest-scoring insurers at the top of the list.
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According to our rate estimates, 21-year-olds pay $2,786 a year, or $232 a month, for full-coverage car insurance. That’s about 56% more expensive than the average for 35-year-old drivers, at $1,785 a year, or about $149 a month. Generally, car insurance rates are much more expensive for 21-year-olds than for older drivers.
Car insurance costs for 21-year-old drivers are determined by several factors, including driving history, location and credit score. Gender also plays a role in calculating your premiums, especially as a teenager or young adult. For example, young men have a disproportionately high accident rate, which causes them to pay more for coverage than young women. However, some states do not allow insurance companies to use gender when 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, in 2015 drivers between the ages of 20 and 24 were 74% more likely to be involved in a crash than drivers in their 30s. Below, you can see crash rates for each age group.
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High risk drivers usually pay higher rates and young drivers usually fall into this category. Below you can see how the average cost by age correlates with the breakdown 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 military members, veterans and their immediate families. Geico is the cheapest company available for any 21-year-old driver, with average rates 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 21-year-old car insurance costs.
*Auto insurance estimates are based on full-coverage policies with $50,000 bodily injury per person, $100,000 bodily injury, $50,000 property damage per accident and $500 deductible for collision coverage and comprehensive coverage.
Which Car Insurance Is Best For Young Adults?
One factor that affects what you pay for car insurance is location, and rates can vary significantly by state. Below are the cheapest car insurance companies in each state for full coverage for 21-year-olds. By our estimates, USAA and Geico are the cheapest providers in most states.
While 21-year-olds pay an average of $232 a month nationwide, drivers in some states pay much less. For example, insurance in North Carolina is $129 per month for the age group.
Because of population density or insurance regulations, some states are more expensive than 21-year-olds. 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 generally affordable for young and older drivers.
Best Car Insurance For Young Drivers
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 the age group. Geico offers a good student discount of 15% and up to 22% for those who have driven without an accident for five years.
The company has been around since 1936 and has an A+ rating from the Better Business Bureau (BBB).
USAA offers the cheapest car insurance for 21-year-olds on average, with rates about 42% below the market average. However, we didn’t name it as the best car insurance for 21-year-olds because it’s not available to everyone. You may only be eligible if you have enlisted in the military, are a veteran, or have a parent who is a USAA member.
USAA is known not only for its under-21 fares, but also for reliable customer service. The company has an A+ rating from the BBB and J.D. The Power 2022 U.S. Auto Insurance Study ℠ earned top scores in nearly every region of the country.
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State Farm is another national provider of affordable car insurance premiums for 21-year-old drivers. Our estimates show that State Farm’s average rates are about 17% cheaper than the national average for this age group.
State Farm offers discounts for young drivers, including a generous student discount of up to 25% for maintaining a B average. Young drivers can save money with State Farm’s Steer Clear® program, an app-based driving course for drivers under 25.
On average, 21-year-old drivers save about 23% nationwide compared to the national average. One thing that makes Nationwide unique is that it offers two usage-based telematics insurance options. SmartRide® can offer discounts of up to 40% based on a person’s driving habits by monitoring acceleration, braking, nighttime driving and more. The other option, SmartMiles®, is a pay-per-mile insurance program that can help people who don’t drive often save money.
Earning an A+ financial strength rating from AM Best and an A+ rating from the BBB, the company is well-regarded in the industry nationwide.
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Another affordable car insurance company for 21 year olds is Auto Owners. Our estimates show that 21-year-olds pay about 26% less than the national average with car owners. The company offers a good student discount of up to 20% and a discount for students who are away from school and leave their cars at home. However, auto owners are only available in 26 states.
Fortunately, age is not the only factor that determines car insurance rates. There are a few things you can do to find the best car insurance rates for 21-year-olds. We recommend thinking about your level of coverage and deductible, comparing providers, keeping a clean driving record and finding discounts.
To save money, you can reduce the amount covered by options like comprehensive and collision insurance. You can waive full coverage and get minimum coverage levels for bodily injury liability and property damage liability. However, if you are at fault for an accident, make sure you can handle any costs that your minimum coverage does not pay.
You can lower your payments by increasing your deductible, which is the amount you pay out of pocket if you file a claim. However, make sure you can afford the deductible.
Average Car Insurance Rates By Age And State
The easiest way to get a better rate is to compare companies. We recommend comparing rates each time you renew your car insurance policy. The cheapest companies for teenage drivers aren’t necessarily the cheapest for drivers in their early 20s, so it pays to check rates as you get older.
Getting a speeding ticket or getting into an accident are surefire ways to rack up higher rates, and 21-year-old drivers already pay more than average. A clean driving history will lower your rates as much as possible.
Not all companies offer the same discounts or the same savings on similar discounts. In our picks for the best car insurance for 21-year-olds above, you’ll find that State Farm, Geico and Auto Owners offer a variety of discounts for good students.
Compare prices online to find the right discount for your situation. You can work with an insurance agent to make sure you find all the discounts that apply to you.
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Another way for 21-year-old drivers to save money
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