Cheapest Car Insurance For Under 25

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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

Cheapest Car Insurance For Under 25

Written by: Daniel Robinson, Written by: Daniel Robinson Writer Daniel is a Guides team writer and has written for numerous automotive news sites and marketing companies in the US, U.K. and Australia, specializing in car finance and car care topics. Daniel is a Guides team authority on car insurance, loans, warranty options, car services and more.

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Edited by: Rashawn Mitchner.

Finding cheap car insurance as a 21-year-old can be difficult. Monthly and annual premiums can be expensive because younger drivers pose more risk to insurance companies. In this article, we at the Guides 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 Guides Team is committed to providing reliable information to help you make the best decision possible about insuring your car. Because consumers trust us to provide objective and accurate information, we have created a comprehensive rating system to formulate our ranking of the best car insurance companies. We collected data on dozens of car insurance providers to rank the companies on a wide range of ranking factors. After 800 hours of research, the final result was an overall rating for each provider, with the insurers that scored the most points at the top of the list.

Pay Less For Car Insurance For Teens & New Drivers

According to our rate estimates, 21-year-olds pay an average of $2,786 per year or $232 per month for full coverage auto insurance. That’s about 56% more expensive than the average for 35-year-old drivers, which is $1,785 per year or about $149 per month. Typically, car insurance rates are much more expensive for 21-year-olds than they are 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 as a teenager or young adult. For example, young men have disproportionately higher accident rates, causing 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 often involved in accidents. Auto 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. Below you can see crash rates for each age group.

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High-risk drivers pay higher rates on average, and young drivers typically fall into this category. You can see below how average costs by age correlate with the crash 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 to 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 is not necessarily the cheapest, but cheap rates definitely help. Below you can see how 11 popular providers rank on car insurance costs for 21-year-olds.

*Auto 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.

Cheapest Car Insurance In Ohio (november 2023)

Location is one of the factors that affects what you pay for car insurance, and rates can vary greatly by state. Below are the cheapest auto insurance companies from 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 an average of $232 per month nationally, drivers in some states pay much less. Insurance in North Carolina averages $129 per 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 consider cost, reputation, coverage, availability and customer experience. We found these companies to be affordable on average for young adult drivers.

The Best Cheap Car Insurance For New Drivers

Geico is our overall pick for the best auto insurance for 21-year-olds. Car insurance rates for 21-year-olds are about 34% cheaper than the market average for the age group. Geico also offers a 15% good student discount and a discount of up to 22% for those who have driven for five years without accidents.

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 call it the best car insurance for 21-year-olds because it’s not available to everyone. You can only qualify if you are enrolled in the military, are a veteran or have a parent who is a USAA member.

USAA not only has low fares for 21-year-olds, but is also known for reliable customer service. The company has an A+ rating from the BBB and earned the highest score in nearly every region in the country in the J.D. Power 2022 U.S. Auto Insurance Study ℠ .

Average Car Insurance Costs For 20 Year Old Drivers

State Farm is another national provider that offers 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 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 State Farm’s Steer Clear® program, an app-based driving course for drivers under 25.

On average, 21-year-old drivers save about 23% with Nationwide compared to the national average. One thing that makes Nationwide unique is that it offers two usage-based telematics insurance options. SmartRide® can provide discounts of up to 40% based on a person’s driving habits by tracking acceleration, braking, night 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.

Nationwide has a good reputation in the industry, earning an A+ financial strength rating from AM Best and an A+ rating from the BBB.

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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 at school and leave their car at home. However, Car Owners is only available in 26 states.

Fortunately, age isn’t the only thing that determines car insurance rates. There are a few things you can do to find cheap rates for the best car insurance for 21 year olds. We recommend thinking about your coverage level and deductible amount, comparing providers, keeping a clean driving record and finding discounts.

To save money, you can lower the amounts that are covered by options such as comprehensive and collision insurance. You can also forgo full coverage and just get minimum coverage levels of bodily injury liability and property damage liability. However, make sure you can handle any costs that your minimum coverage won’t pay for if you’re at fault for an accident.

You can lower your payments by increasing your deductible, which is the amount you pay out of pocket when you file a claim. Be sure you can afford the down payment, though.

Auto Insurance Givebacks (2023)

One of the easiest ways to get a better rate is to compare companies. We recommend comparing rates every time your car insurance policy is up for renewal. The cheapest companies for teen 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 causing an accident are surefire ways to get higher rates, and 21-year-old drivers already pay more than average. A clean driving record will keep your rates as low 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 can see that State Farm, Geico and Auto Owners offer different discount amounts for good students.

Compare quotes online to find the right discounts for your situation. You can also work with an insurance agent to make sure you find all applicable discounts.

Car Insurance Costs For 25 Year Old Drivers

Another way for 21-year-old drivers to save money

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