Finding affordable car insurance for new drivers can be a difficult task. However, there are several options available that might suit their requirements. Many insurance companies offer discounts for new drivers which can lower their insurance costs. However, the availability and amount of these discounts can vary based on the state and the insurance company. It is important to note that teenagers generally pay higher rates than other age groups, and the cost of insurance depends on factors such as location, driving record, and level of coverage. Here are the average annual rates for full coverage and minimum coverage based on age group:
- 16-year-olds: $6,613 for full coverage; $2,733 for minimum coverage.
- 17-year-olds: $5,373 for full coverage; $2,206 for minimum coverage.
- 18-year-olds: $4,837 for full coverage; $1,938 for minimum coverage.
You can compare car insurance rates and quotes from different companies by using online tools to find the cheapest car insurance for new drivers. Here are some of the best and cheapest car insurance companies for new drivers in 2024:
1- Allstate: Cheapest liability-only coverage for new drivers
Allstate offers car insurance for new drivers. They have a program called Drivewise that rewards safe driving habits with cashback and discounts on premiums. The program tracks driving habits such as speed, braking, and time of day to determine the driver’s risk level. Allstate also offers a Good Student Discount for students who maintain a good academic record.
Allstate offers the cheapest liability coverage car insurance rates for first-time drivers under 25 years old. On average, new drivers can expect to pay $2,743 per year for insurance. However, Allstate’s policy costs 56% less, at $1,205 per year. This company offers the cheapest car insurance rates for new drivers under 25 and over 25 years old. The average cost to add a 16-year-old driver is $100 per month, and the average cost for a new driver over 25 is $395 per year.
2- Hugo: Best on-demand coverage for new drivers
Hugo car insurance is a new company that offers flexible, on-demand coverage for drivers. Policyholders can make “micropayments” for three days of coverage and up to six months at a time, depending on the plan. Hugo has no up-front fees, and drivers can pay as they go with a $0 down payment.
Hugo has three coverage options: Flex, Unlimited Basic, and Unlimited Full, designed for different types of drivers and their needs. Based on Hugo car insurance reviews, it does not provide a specific rate for new drivers but rather offers a personalized quote based on various factors, such as your driving history, location, vehicle, and coverage needs. You can check your price and sign up on their website. See Hugo insurance reviews.
Hugo does not have any specific requirements for driving experience or age, as long as you have a valid driver’s license and meet the state’s minimum insurance standards. Hugo offers personalized quotes based on various factors, such as your driving history, location, vehicle, and coverage needs.
However, you should be aware that Hugo car insurance policies apply to the car itself, and not to the driver. This means that if you borrow someone else’s car, you may not be covered by Hugo unless the car owner has added you as a listed driver on their policy. Similarly, if someone else borrows your car, they may not be covered by Hugo, unless you have given them permission to use your car and they meet the eligibility criteria.
3- State Farm: Cheapest rates for full coverage
State Farm car insurance is a good option for new drivers. It offers many coverage options, discounts, and personalized services from agents. This company has the best rates for full-coverage insurance, which pays for your own car repairs and medical bills in addition to the other driver’s damages. The average cost to add a 16-year-old driver is $276 per month, and the average cost for a new driver over 25 is $1,398 per year. State Farm also offers a family policy that can save you money if you add a new driver to an existing policy.
Based on State farm car insurance reviews, it offers many discounts for young drivers and teen drivers, such as the Steer Clear® program1 and the Drive Safe and Save program. These programs can help new drivers save money on their premiums and improve their driving skills. It has over 19,000 local insurance agents across the country, which can provide personalized service and advice for new drivers. State Farm agents can help new drivers choose the right coverage, file claims, and access other benefits.
It has an excellent AM Best financial strength rating of A++, which means it has a superior ability to pay out claims. This can give new drivers peace of mind that they are covered by a reliable and stable company.
It requires customers to purchase policies from local agents, which can limit the online options and convenience for new drivers. Also, it tracks more driving behaviors than other usage-based programs and continues monitoring indefinitely, which can affect the privacy and comfort of new drivers. State Farm’s Drive Safe and Save program uses a mobile app or a connected car device to track speed, acceleration, braking, cornering, phone use, and time of day. Unlike some other programs that stop monitoring after a certain period, State Farm continues to track these behaviors for as long as the customer is enrolled in the program.
4- Geico: the best online experience and customer service
GEICO car insurance is another Cheapest car insurance for new drivers. It offers competitive rates, discounts, and online convenience for customers. Based on Geico Car Insurance Reviews, it also has a high customer satisfaction rating and a strong financial strength rating. This company has the best online experience and customer service, according to MoneyGeek. The average cost to add a 16-year-old driver is $296 per month, and the average cost for a new driver over 25 is $1,952 per year.
It has many discounts for young drivers and teen drivers, such as the good student discount, the good driver discount, and the alumni associations, colleges, universities, and student organization discounts. Geico allows customers to buy policies online or over the phone, which can save time and hassle for new drivers. It has a usage-based program called DriveEasy, which can help new drivers save money and improve their driving habits. DriveEasy is another benefits of having geico car insurance that uses a mobile app to track driving behaviors such as speed, braking, phone use, and time of day.
It may not have as many local agents as State Farm, which can limit the personal service and advice for new drivers. GEICO has about 150 local offices across the country, while State Farm has over 19,000 local agents. It may not offer as many coverage options as State Farm, which can affect the protection and customization for new drivers. For example, GEICO does not offer gap insurance or rideshare insurance. It may have higher rates for drivers with poor credit or accidents, which can increase the cost for new drivers.
5- Lemonade: New car insurance option for new drivers in 2024
Lemonade car insurance is a new option for new drivers. It uses app-based telematics, which collects data about how often and how safely you drive via the Lemonade mobile app. This means that safe drivers and low-mileage drivers may pay less for their insurance based on lemonade car insurance reviews.
It offers discounts for drivers making environment-friendly choices, such as owning a hybrid or electric vehicle. It also provides emergency charging and charger coverage for EV owners. Lemonade car insurance plants trees to offset the carbon emissions of your car. It claims to shrink your car’s carbon footprint by using the app to determine the number of trees that need to be planted. The Company includes 24/7 on-site roadside assistance and real-time crash detection for free. It also has a fast and hassle-free claims process.
It may not be available in your state yet, as it is still in the early stages of launching. As of October 2023, it is only available in Texas, but you can sign up for early registration if you are interested in 2024. It may not have as many coverage options or discounts as other insurers, such as State Farm or GEICO. For example, it does not offer gap insurance or rideshare insurance. It may track more driving behaviors than other usage-based programs, which can affect your privacy and comfort. The Lemonade app tracks speed, acceleration, braking, cornering, phone use, and time of day. Lemonade Life Insurance Reviews.
6- Progressive: Best discounts for new drivers
Progressive offers competitive rates, discounts, and online convenience for customers. It also has a high customer satisfaction rating and a strong financial strength rating. Progressive car insurance rates for new drivers vary depending on several factors, such as age, driving record, credit score, vehicle type, and location. The average cost of a six-month liability-only policy from Progressive is $102 per month. However, this is not a personalized quote and may not reflect your specific situation.
Progressive also offers discounts for new drivers, such as the good student discount, the good driver discount, and the alumni associations, colleges, universities, and student organization discounts. You can also save money by enrolling in the DriveEasy program. DriveEasy tracks your driving behaviors using a mobile app and rewards you for safe driving. It allows customers to buy policies online or over the phone, which can save time and hassle for new drivers. Customers can also start the quote process online and get a free car insurance quote.
As Progressive insurance pros and cons, it may have higher rates for drivers with poor credit or accidents than other insurers. Progressive’s average rate for drivers with poor credit is $4,270 per year, or $356 per month, while the national average is $3,873 per year. Progressive’s average rate for drivers with one at-fault accident is $4,511 per year, or $376 per month. While State Farm’s average rate is $3,396 per year or $283 per month.
It may not have as many local agents as other insurers, such as State Farm. It may not offer as many coverage options as other insurers.
Car insurance discounts for new drivers
- Good student discount: This discount is for young drivers who maintain at least a B average in school.
- Defensive driving course discount: This discount is for drivers who take a certified defensive driving course to improve their driving skills and safety awareness.
- Student away-from-home discount: This discount is for parents who have a young driver on their policy who is away at school and does not use the car regularly.
- Multipolicy discount: This discount is for drivers who have more than one insurance type with the same company, such as renters or homeowners insurance.
- Military or occupation discount: This discount is for drivers who are in the military or have certain occupations that are considered low-risk by the insurer.
- Safety equipment discount: This discount is for drivers who have cars with advanced safety features, such as anti-lock brakes, airbags, or anti-theft devices.
How to get the cheapest car insurance for new drivers
There are some ways that new drivers can get discounts for car insurance and lower their premiums. Some of the common methods and the best way to get cheap car insurance are:
- Limit your mileage: Driving less means you have a lower chance of getting into an accident, so some insurers may offer you a lower rate if you keep your annual mileage below a certain limit.
- Pay annually: Paying your premium in one lump sum instead of monthly installments can save you money, as some insurers may charge interest or fees for spreading out your payments.
- Take a defensive driving course: Completing a certified defensive driving course can show insurers that you are a safe and responsible driver, and they may reward you with a discount. Some states also allow you to reduce your points or violations on your driving record by taking such a course.
- Be a good student: If you are a young driver who maintains at least a B average in school, you may qualify for a good student discount from some insurers. This can help you save up to 25% on your premium5.
- Join a club or organization: Some insurers may offer discounts to members of certain clubs or organizations, such as AAA, military, or alumni associations. You may need to provide proof of membership to get the discount.
- Drive a safe or eco-friendly car: Driving a car that has advanced safety features, such as anti-lock brakes, airbags, or anti-theft devices, can lower your risk of injury or theft, and thus lower your premium. Similarly, driving a hybrid or eco-friendly car can save you money on gas and reduce your environmental impact, which some insurers may appreciate and reward with a discount.