New Driver Auto Insurance Coverage

New driver auto insurance is more expensive than the average auto insurance rate regardless of age. Car insurance for new drivers can be reduced if you've completed a driver's ed course. Taking advantage of discounts decrease new driver car insurance by at least 20%, depending on the company. Compare multiple companies and shop around to find cheap auto insurance for new drivers.

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Sara Routhier, Managing Editor of Features and Outreach, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming worl...

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Cynthia Lanctot is an insurance professional with ten years of industry experience. Cynthia is licensed in several states, and holds an associate in claims law, as well as a bachelor’s degree in English. Cynthia’s experience includes the New England and Northeast states. She currently works as a liability claims professional and an occasional online contributor.

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Reviewed by Cynthia Lanctot
Licensed Agent

UPDATED: Dec 30, 2020

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New Driver Auto Insurance Facts

  • Teens carry the most expensive car insurance rates.
  • New adult drivers have auto insurance rates that are more expensive than average.
  • Auto insurance discounts reduce higher than average insurance costs.
  • The right car insurance company can get you affordable rates.

All new driver auto insurance will be more expensive than most insurance policies. You can reduce the cost of new driver car insurance by selecting the auto insurance coverages you need and taking advantage of discounts. The more car insurance discounts you’re eligible for, the less you’ll pay for car insurance per month.

In this guide, we’ll compare multiple companies and how much auto insurance for new drivers cost. Also, we’ll provide a list of common discounts you can take advantage of before you make a final decision to purchase a policy.

Compare new driver auto insurance in your local area by entering your ZIP code in the FREE online tool above.

New Driver Auto Insurance Rates

First-time driver insurance costs may surprise you if you’re an adult getting auto insurance. You’ve probably seen annual car insurance rates around $2,000 or less. Unfortunately, car insurance for first-time drivers over 25 will be higher than average because you’re a new driver.

New drivers won’t have an auto insurance history, and they likely won’t have a driving record either. However, they’re still considered inexperienced drivers according to the car insurance history. Here are the average monthly rates for new drivers.

Average Monthly Auto Insurance Rates for New Drivers by Company
CompaniesAverage Monthly Auto Insurance Rates
USAA$214
Nationwide$215
GEICO$245
State Farm$372
Liberty Mutual$377
Farmers$415
Allstate$439
Progressive$538
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USAA, Nationwide, and GEICO have the cheapest auto insurance rates for new drivers. However, USAA is only available to members of the U.S. Armed Forces and their immediate families.

According to the National Association of Insurance Commissioners (NAIC), the national average for full coverage auto insurance is $86 per month, while liability coverage carries an average of $46 per month. When you’re a new adult driver or teen driver, you’ll pay close to what the top auto insurance companies charge. Read on to the next section to learn how age affects auto insurance rates.

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How Age and Driving Experience Affect Auto Insurance Rates

Teen drivers and new adult drivers are risky drivers because they’re less experienced than the average driver. Insuring anyone with less than average driving experience is risky. Teen typically take more risks in addition to less risk. Therefore, auto insurance companies prepare expensive rates to offset potential bodily injury and property damage costs. Continue reading to the other sub-sections to see how average costs for new drivers.

The Best Auto Insurance Companies for New Drivers under 25

Finding the best company depends on your needs. Sometimes the cheapest company isn’t the best choice. However, some auto insurance companies are good at particular age groups.

For example, GEICO is known for its cheaper rates and flexibility with college students across the United States, so the company is ideal for college teens and young adults. USAA is suitable for U.S. military members, and State Farm is known for its quick processing claims.

The best way to discover which is the best company is to engage in comparison shopping.

Cheap Auto Insurance for New Drivers under 21

The road to cheap car insurance for new drivers under 21 years old is going to be difficult. Auto insurance for teen drivers and young adult drivers is expensive for parents and for a teen who decided to pay for auto insurance. Let’s examine the average monthly rates of new drivers under 21. We’ve included the monthly rates by gender to show you the car insurance rate disparities between males and females.

Comparing Average Monthly Auto Insurance Rates of New Drivers by Age and Gender
New Driver's AgeAverage Monthly Male Driver RatesAverage Monthly Female Driver RatesAverage Monthly Auto Insurance Rates
16$648$481$565
17$571$466$519
18$491$421$456
19$374$320$347
20$342$294$318
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On average, female drivers pay less than male drivers. That’s because male drivers take more risks when operating a motor vehicle. You’ll need to take driver’s education courses to show car insurance companies that you’re a safe driver and reduce your auto insurance rates. The company will likely give you a discount, but it won’t significantly decrease your insurance policy. Let’s keep reading to see what other discounts can impact your auto insurance rates more.

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3 Ways New Drivers can Save Money on Auto Insurance

The key to saving on new driver auto insurance is through several avenues.

Use the following sections to explore each avenue so you can secure affordable auto insurance rates.

Auto Insurance Discounts

Here’s a list of typical discounts that can help save money on car insurance for new drivers.

  • Affinity Membership – This discount is usually available through your job.
  • eSign – Starting your insurance policy carries a discount benefit, but some companies don’t provide eSign discounts.
  • Good/Safe Driver – A clean driving record can save you hundreds per year, but new drivers will only get this discount after passing a driver’s ed course.
  • Good Student – Any teen or young adult with exceptional grades and a high GPA can receive this discount.
  • Green Vehicle Discount – Eco-friendly vehicles produce less Carbon Dioxide, which is essential for areas with emission standards and important for discounted auto insurance.
  • Homeowner Discount – New drivers who own a home correlate to less risk on the road.
  • Multiple Drivers – Auto insurance companies give a discount policyholder with multiple drivers on one policy.
  • Multi-Policy – Bundling another insurance service with the same company carries a discount of up to 12 percent.
  • Multi-Vehicle – Car insurance companies give you a break on rates when you insure more than one vehicle.
  • Paid in Full – If you pay your bill in full at the start of your auto insurance policy, you can receive at least five percent off.
  • Payment by Bank Account – Some auto insurance companies provide a two percent discount for setting up paperless billing and automatic payments (EFT).

As you shop around, ask about other discounts. You may also get a discount for safety features and anti-theft systems on your vehicle. Next, let’s review what coverage option can save you money.

What is the required auto insurance coverage for new drivers?

All drivers, experienced and inexperienced, require liability auto insurance. In most areas across the United States, liability coverage is the minimum auto insurance requirement. If you own the vehicle, you can enroll in liability-only coverage. However, a car you’re currently making payments on will need full coverage auto insurance.

Liability-Only Coverage

This is the cheapest car insurance option for new drivers. It includes bodily injury liability and property damage liability. Uninsured/underinsured motorist coverage and personal injury protection are included in liability-only coverage in states where it’s required. Other states allow you to leave out uninsured/underinsured motorist and personal injury protection.

Enrolling in Usage-Based Auto Insurance

Pay-as-you-drive and pay-how-you-drive insurance programs have become popular in recent years. Start-up companies found a way to provide day-to-day car insurance for motorists. It wasn’t long before the insurance industry leaders started investing in usage-based auto insurance.

Today, customers of auto insurance leaders can enroll in usage-based programs to save money on their insurance policies. Here’s a list of the most popular usage-based programs and their savings.

Telematics and Usage-Based Auto Insurance Programs
Company Telematics ProgramsEstimated Savings
Progressive SnapShotAverage of $130
Allstate DrivewiseAverage of 10% to 25%
State Farm Drive Safe & SaveUp to 15%
Esurance DriveSenseVaries
Nationwide SmartRideUp to 40%
Liberty Mutual RightTrackAverage of 5% to 30%
Root Car InsuranceVaries
MetromileVaries
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Some of these companies require telematics—a device that monitors your driving habits such as speed, hard braking, and hands-free driving. Unfortunately, Telematics and usage-based car insurance programs aren’t available all over the United States.

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New Driver Auto Insurance: The Bottom Line

Auto insurance companies are concerned about risk. New drivers pose a significant risk to car insurance companies, so they charge higher rates. Under the right circumstances, you can take advantage of company discounts and slash high prices. Be aware of your driving habits, so you can ask for more savings for being a good driver during the policy when the time comes.

Auto insurance companies typically like to increase rates after six months. If you don’t file any claims and manage to avoid moving violations, you may be due for more savings.

Enter your ZIP code in the FREE comparison tool below to secure affordable new driver auto insurance rates.

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Frequently Asked Questions: New Driver Auto Insurance

Did we miss something? The last section of this guide will answer a few frequently asked questions we may have missed in the guide. Please bookmark this page. As more information develops, we’ll be updating this guide, and many others like it to keep you informed.

#1 – Who needs new driver auto insurance?

Any teen, young adult, immigrant, or foreign national should purchase new driver car insurance. It’s important to let auto insurance companies know you’re a new driver even though your rates will be higher. You don’t want to lie to car insurance companies about your driving experience.

#2 – What’s the average auto insurance rate for new teen drivers?

New teen drivers pay between $347 and $565 per month on car insurance.

#3 – Are immigrants and foreign nationals considered new drivers?

Yes. Any person not licensed in the United States is considered a new driver. New drivers are required to pass written and performance driving tests. Also, new drivers are required to carry the minimum auto insurance requirements.

#4 – Are you a high-risk driver if you have a coverage gap in auto insurance?

Car insurance companies will list you as a high-driver if you have a coverage gap. Large gaps in driving experience may also raise some flags with insurance companies. Therefore, your auto insurance history may lean toward high-risk for any gaps in insurance coverage and driving experience.


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