Best Car Insurance for Teens and Young Drivers
- Expertise: Auto insurance, home insurance and renters insurance
- Education: University of California-Berkeley (BA in History)
Rob Bhatt is a licensed insurance agent and joined the staff of Lending Tree in 2021. Previously, he spent more than 20 years writing for and editing regional publications in California, Nevada and Washington. Rob enjoys helping readers understand how different coverages work so they can make informed purchasing decisions, and he specializes in producing research-backed content for LendingTree about auto, home and renters insurance. His work has been cited by ABC, Business Insider, MSN and Yahoo.
Erie and Country Financial have the best car insurance for teen drivers. Both are regional companies with low rates and high ratings in customer satisfaction.
State Farm is the best large auto insurance company for teens.
Best car insurance rates for young drivers
Erie has the best car insurance rates for young drivers. It charges 18-year-olds an average of $1,264 a year for liability insurance, or $105 a month.
Erie is only available in 12 states and the District of Columbia (D.C.). The four next-best rates after Erie also come from regional companies.
State Farm has the best car insurance quotes for teenagers among large companies. Its rates average $1,811 a year, or $151 a month.
| Company | Average annual rate |
|---|---|
| Erie | $1,264 |
| Westfield | $1,366 |
| Country Financial | $1,401 |
| Farm Bureau | $1,574 |
| Auto-Owners | $1,700 |
| State Farm | $1,811 |
| Geico | $2,044 |
| American Family | $2,364 |
| U.S. average | $2,433 |
| Travelers | $2,655 |
| Progressive | $3,193 |
| Nationwide | $3,371 |
| Allstate | $3,399 |
| USAA* | $1,030 |
USAA has the best overall car insurance rates for teenagers. However, USAA is only available to the military community.
Teens usually get cheaper car insurance quotes when added to a parent’s policy than they do on their own.
Best car insurance companies for teen drivers
Erie, State Farm, Country Financial and USAA are the best car insurance companies for teens. They each stand out for low rates, high ratings in customer satisfaction and valuable policy features.
Ratings include overall satisfaction scores from J.D. Power and complaint data from the National Association of Insurance Commissioners (NAIC).
| Category | Company | Annual rate | Satisfaction rating (820 is average) | Complaint rating (1.0 is average, lower is better) |
|---|---|---|---|---|
| Best large company | State Farm | $1,811 | 833 | 0.8 |
| Best regional company | Erie | $1,264 | 855 | 0.9 |
| Best complaint rating | Country Financial | $1,401 | 828 | 0.3 |
| Best for military families | USAA | $1,030 | 876 | 1.0 |
Best large insurance company for teens: State Farm
State Farm has the best rate among large insurance companies and a high satisfaction score. It makes its rates more affordable with discounts to teenagers who get good grades and/or complete a driver training program.
State Farm’s Drive Safe & Save program opens the door to even more savings. The program uses a smartphone app to monitor your driving. You get a large discount just for signing up. If you drive safely enough, you get additional discounts when you renew.
| Pros | Cons |
|---|---|
| Best teen rates among large companies | Higher rates than some regional companies |
| Above-average satisfaction scores | |
| Discounts for teens with good grades |
Best regional car insurance company for young drivers: Erie
Along with low rates, Erie offers plenty of ways for young drivers and their parents to save. This includes a discount for teens who complete an accredited driver training program. If you’re a parent, you can get a Youthful Driver Discount just for adding your teen to your policy.
Erie does not offer an app-based safe driver program. Some consider these programs intrusive. Others enjoy the savings they provide. Most large companies offer them, and some regional companies do, too.
| Pros | Cons |
|---|---|
| Lowest average rate for teen drivers | Only available in 12 states and D.C. |
| Higher customer satisfaction rating than most other auto insurance companies | Does not offer a good-student discount |
| Parents get a discount for adding their young driver to their policy | No app-based safe-driver program |
Best complaint rating: Country Financial
Country Financial offers low rates as well as deeper discounts for teens than most other companies. These include a good-student discount of up to 35%.
Country Financial’s complaint rating indicates it has one-fourth as many confirmed complaints as expected for its size. A low complaint rating reflects a company’s ability to meet customer expectations.
| Pros | Cons |
|---|---|
| Better complaint rating than most companies | Only available in 19 states |
| Rates are 42% less than national average | |
| Satisfaction score beats national average |
Best for teens in a military family: USAA
USAA car insurance is a no-brainer for teenagers in military families. The company has the cheapest teen car insurance rate of all the companies we surveyed. It also has the industry’s highest overall customer satisfaction score.
If one of your parents is already a USAA member, they can pass their eligibility on to you. USAA’s lack of personalized service is one of its few drawbacks. You often end up speaking to a different representative each time you call the service center for help.
| Pros | Cons |
|---|---|
| Best overall car insurance rates for teens | Lack of personalized service |
| Highest satisfaction score in the industry | Only available to the military community |
| Digital platform makes it easy to manage your policy online or on a smartphone app |
Best car insurance discounts for teens
The best car insurance discounts for teens include those for getting good grades, completing a driver training course and driving safely.
The names and details of each discount vary by company. Here are the best types of discounts to look for when you shop.
Good student discount
Most companies offer a good student discount to teens who maintain a B average or better in school. Allstate extends the discount to teens with a B- average.
You don’t need a copy of school transcripts to get a quote. But you will need to provide them to the insurance company you choose when you activate your policy.
Safe driver program
Several companies offer a big discount for joining their safe driver program. The programs typically use a smartphone app to monitor your driving. You get an initial discount for signing up and future discounts if you drive safely enough.
These programs have the added benefit of encouraging teens to drive safely. Being monitored often gives them extra incentive to avoid risky behaviors such as speeding or texting while driving.
Driver training discount
Several companies offer a discount to young drivers who complete an approved driver training program. Some companies accept any accredited class. Others require you to complete a specific program.
Away at school
Parents can often score an away at school discount if their teenager goes off to college without a car. The discount applies to a variety of higher learning institutions. This keeps the teen insured for occasional driving, while parents save money.
More discounts for teens
Erie and Progressive give parents a youthful driver discount for adding a young driver to their policy.
American Family and Country Financial are among the companies that offer a generational or legacy discount. If you already get car insurance from one of these companies, your child gets a discount when they get their own policy.
American Family also offers a discount to young drivers who volunteer for a nonprofit.
Best car insurance coverages for teenagers
The best car insurance coverage for teenagers depends on your situation. Here’s how the various coverage types work for teens.
Liability
Most states require you to have liability auto insurance. It covers injuries and damage you cause to others, up to your policy’s limits.
Your liability limits should match your net worth. Parents with a teen need high liability limits to protect their home, savings and other assets. A teen on their own can usually get by with their state’s minimum requirements, unless they have a high net worth.
Collision and comprehensive
Collision and comprehensive (comp) combine to cover your vehicle for damage or theft. Neither is required by law. However, lenders require both for a car loan.
Collision and comp require you to pay a deductible before insurance funds kick in. Your payment is capped at your car’s market value. A teen only needs these coverages if they have a car loan or their vehicle is worth more than a few thousand dollars.
Uninsured motorist/personal injury protection
Uninsured motorist (UM) and/or personal injury protection (PIP) are required in some states and optional in others.
UM covers injuries a driver with no insurance causes to you and your passengers. PIP covers injuries to you and your passengers, regardless of fault.
Either or both can protect you from large out-of-pocket expenses, including health insurance deductibles and copayments. This makes them nice to have, but not essential, in states where they are optional.
Best cars to insure for teens
Vehicles built for safety tend to be the best cars for teenagers to insure.
A teen can often get an insurance discount if their car has electronic stability control, antilock brakes and airbags. These features also reduce a teen’s risk of being injured in a car accident.
The Insurance Institute for Highway Safety (IIHS) and Consumer Reports provide a list of top vehicles for young drivers. They recommend vehicles that are affordable, perform well in safety tests and have low accident rates.
Their recommendations include:
- Nissan Murano (Model year 2015 or newer)
- Mazda 3 sedan or hatchback (2014 to 2020)
- Subaru Legacy (2013 to 2021)
- Toyota Avalon (2015 or newer)
- Volvo XC60 (2013, 2017)
Frequently asked questions
The average cost of car insurance for a teenager is $2,433 a year, or $202 a month, for liability coverage. Full coverage costs an average of $5,824 a year, or $485 a year.
Teens usually get a lower rate when added to a parent’s car insurance than they do on their own.
A teenager’s car insurance rates go up by an average of 33% after an at-fault accident. The average cost of liability car insurance for a teenager with an accident is $270 a month.
High crash rates are the main reason why car insurance is so expensive for teen drivers. Crashes require insurance companies to pay accident victims for medical treatment and car repairs. Insurance companies recoup these expenses through higher rates for riskier drivers. Teens crash at nearly four times the rate of drivers over 20, according to IIHS.