Drivers of all ages need car insurance. While insurance rates are typically highest for teenagers, drivers continue to pay higher rates until around the age of 25. Insurance companies view younger drivers as higher-risk and therefore charge higher monthly or annual premiums on their insurance policy.
Even though younger drivers are higher-risk, many factors go into determining your rate. Premiums vary from one insurance company to the next. Comparing different auto insurance companies will help you to find the best car insurance provider and insurance coverage for you.
You gain independence. When you have your driver’s license, you can go where ever you want. You don’t have to rely on anyone else (family members, friends, public transportation, ridesharing) to take you where you need to go. You also have more employment opportunities since you can get yourself to and from a job.
You have more time to get experience. Young drivers lack experience, but many states have laws in place to counter this. Depending upon where you live, you may need to log a specific number of hours with a more experienced driver to get your full license or observe a curfew.
You take on more responsibilities. As a driver, you need to look out for your own safety as well as the safety of others on the road. You also become responsible for the care and maintenance of your car.
You have less experience. As a younger driver, you have less experience than someone who has been driving for several years. The longer you drive, the more experience you gain.
Renting a car is difficult. It’s not impossible to rent a car under the age of 25, but it more difficult and much more expensive.
Insurance rates are higher. Teens and young adults typically pay higher monthly or annual insurance premiums than adults over the age of 25.
The average cost of car insurance for people under 25 varies significantly based on age. In 2020, insurance policy premiums for a 25-year old driver range from $608 to $2,184. For an 18-year-old driver, premiums range from $1,870 to $5,473.
While your age plays a significant role in what you pay for auto insurance, there are several other factors that companies consider as well, including:
Where you live
Your driving record
Your credit history
The type and value of your car
The number of miles you drive your car
State minimums and other coverages you select
The auto insurance company
Just because you’re under 25, that doesn’t mean that you can’t get lower rates. Many car insurance companies offer special discounts and deals for their customers.
Good student discount. Full-time high school and college students who meet specific grade requirements can receive anywhere from an 8% to 25% discount.
Safe driving discount. If you are incident-free for a set period, you may qualify for a discount of between 10% and 40%.
Accident forgiveness. Some insurance companies offer “accident forgiveness,” which protects your premium from increasing in the event of an at-fault accident.
Disappearing deductible. Some companies will decrease your deductible for every year of accident-free driving up to a certain amount.
Defensive driving discount. If you take an approved defensive driving course, you could qualify for a discount of 5% to 10%.
Pay in full discount. If you pay your annual premium up front, you could save up to 10%
Multi-policy discount. Insurance companies often provide a discount for having more than one policy with them. You can save between 5% and 25%.
Car safety and anti-theft discounts. If your car has specific safety or anti-theft features, you may qualify for a discount.
Paperless discount. Instead of having a physical copy of your car insurance bill mailed to you, you can opt to go paperless. Some insurance companies offer a small discount for doing so.
EFT discount. If you have your payments automatically deducted from your bank account, you may qualify for a small discount.
Occupational discounts. Depending upon your occupation, you may qualify for a discount. For instance, Geico offers a 15% discount for military members.
When you’re ready to begin searching for the best car insurance policy, there are a few things that you need to have in order. You will need to provide:
Your date of birth
Your driver’s license
Your driving record
Your car insurance history
The address where your car is stored
The VIN (vehicle identification number) of your car
Car insurance may be more expensive for young adults, but you can find affordable options that meet your needs. Every insurance company charges different premiums, even though you provide the same information and ask for the same types of coverage. Here are some of the cheapest car insurance providers for drivers under 25.
Geico started as a car insurance company for government employees and military members. Today, the company offers a wide array of insurance products to drivers in all 50 states and Washington, DC.
In addition to lower rates for young adults, Geico has high claims satisfaction rates. Overall, it boasts a 97% satisfaction rate.
The company offers a significant number of discounts, such as:
You can manage your policy from Geico’s mobile app, which features one tap bill pay, digital ID cards, and mobile claims filing. If you need help in-person, there are more than 150 Geico offices located across the country.
Geico may not have all of the same coverages as other companies, but it provides more than enough to meet the needs of most drivers. You can customize your policy to meet the minimum requirements based on where you live and add on few extra coverages if you need them.
Progressive is one of the best car insurance companies for drivers considered to be high-risk, like young adults. Founded in 1937, the company has continued to be a leading innovator in the industry and has set numerous industry standards.
With Progressive, you can “name your price.” You provide some basic information, and the company will tell you the highest and lowest amounts you’re likely to pay. You then say what you want to pay, and the company will try to create a policy that fits within your numbers.
Customers have access to simple, online claim forms and 24/7 support. You can also take advantage of several discounts, such as:
Getting an online quote or signing up online
Paid in full
Esurance is a newer company, founded in 1999, and is currently available in 43 states. The company claims to make the insurance process easy by providing a tool that allows you to compare rates. It also offers photo claims and a mobile app that allows you to manage your policy on the go.
Along with lower rates for drivers under 25, Esurance offers a wide range of discounts, including:
Allstate is one of the largest insurance companies in the United States. Along with affordable rates for young adults, the company offers some of the best features and coverage options. Insurance coverage is available for drivers in all 50 states.
Customers can take advantage of a wide range of discounts. These discounts include:
EZ pay (automatic payments)
Along with standard policy options, you can tack on others, such as:
Sound system protection
Safe driving bonus
To find the best car insurance under 25, you need to shop around. There are several places where you can find the right insurance for you.
One of the most common ways to shop for car insurance is to go to each company’s website. Most insurance websites provide a substantial amount of information about their policies, including coverages and discounts. You may also be able to get a quote directly on the website or call the company’s telephone number to speak with a representative. When requesting quotes from each site, be sure to use the same information.
Rather than visiting individual websites, you can use websites like PolicyScout to compare your options. After providing basic information, the site gives you a results page with quotes from different car insurance providers. You can then visit the individual company’s website for more information or begin the application for coverage. The process saves you a significant amount of time as you don’t have to worry about getting quotes from several different companies on your own.
Another option is to go through a local broker. You can search for brokers in your area and either call them or visit the office. A local broker can help you to understand the coverages that you need based on where you live and find the best policy for your needs at the best price possible. They can also work on your behalf when it comes to filing claims and review your policy with you annually.
Car insurance may be more expensive for drivers under the age of 25, but you don’t have to pay exorbitant premiums just because of your age. Shop around and compare your options carefully to find the best option that meets your needs.