Turning 18 is a significant milestone, and drivers may need to start thinking about their auto coverage and whether they’ll stay on their parent’s policy or purchase separate coverage. Due to higher-than-average accident frequency, the average 18-year-old driver still pays more for car insurance than older age groups. You can help lower your premium by understanding what factors influence the price of car insurance for an 18-year-old.
Car Insurance for 18-Year-Old
Car insurance for 18-year-olds is expensive, whether you add them to your policy or they buy their own. As a result, the best car insurance for 18-year-olds must be as inexpensive as possible.
Best 18-Year-Old Car Insurance
The best car insurance for 18-year-olds excels in areas such as cost, coverage, and customer service. Geico, USAA, State Farm, Erie Insurance, and Auto-Owners Insurance are our top picks.
Our top pick for the best car insurance for 18-year-olds is Geico. Geico is the cheapest company with nationwide availability, as Erie is only available in a few dozen states and USAA is only available to military members, veterans, and their families. According to our estimates, Geico’s average rates for 18-year-olds are approximately 36% lower than the national average. Geico also provides driver education and good student discounts, which can lower teen driver rates.
USAA is another low-cost option for 18-year-old drivers, with average rates that are approximately 42% lower than the national average cost of car insurance for this age group. If either of you is in the military or retired, your teen may be eligible for USAA. If you are a USAA member, you can also pass down eligibility to your children.
Aside from low rates, USAA provides dependable customer service. It has an A+ rating from the Better Business Bureau (BBB) and received the highest score of 909 out of 1,000 in the J.D. Power 2021 U.S. Auto Claims Satisfaction Study.
#3. State Farm
State Farm makes our list of the best car insurance for 18-year-olds because of its student and teen discounts. The Steer Clear® program, for example, is a course for young drivers that teaches them how to drive safely and provides them with discounts when they complete it. State Farm also offers a good student discount of up to 25% until drivers reach the age of 25. According to our estimates, State Farm’s average rates for 18-year-olds are approximately 33% lower than the national average.
#4. Erie Insurance
In 12 states and Washington, D.C., Erie Insurance provides affordable coverage. According to our estimates, its average rates for 18-year-olds are approximately 42% lower than the national average. Erie, like USAA, performed well in the J.D. Power Auto Claims Satisfaction Study, earning 901 points out of 1,000.
#5. Automobile Owners Insurance
Auto-Owners is a 26-state insurance company that provides a variety of coverage options as well as teen driver discounts. If your 18-year-old maintains a B average or higher, the company’s good student discount applies, and it offers up to 20% off. Teens who use a GPS device while driving can also qualify for a teen driver monitoring discount. According to our estimates, Auto-Owners pay about 41% less than the national average for 18-year-olds.
Why Is Car Insurance for an 18-Year-Old So Expensive?
Teenage drivers have higher car insurance rates because they have less driving experience and are more likely to be involved in car accidents. As a result, they are more difficult to insure. Even if an 18-year-old has a clean driving record, they will pay significantly more for insurance than older drivers in their 30s or 40s. According to the AAA Foundation for Traffic Safety, 18- and 19-year-olds are more than twice as likely as drivers aged 30 to 39 to be involved in an accident.
Price of Car Insurance for an 18-Year-Old
Insurance is typically much cheaper on a parent’s policy than on an 18-year-old driver’s policy. In general, 18-year-olds pay relatively high car insurance premiums, with the average full coverage policy costing $5,320 per year and minimum coverage costing $1,714 per year if purchased on their own. If they continue to be covered by their parent’s car insurance, the average 18-year-old driver pays $3,352 per year for full coverage and $1,102 per year for minimum coverage. The high price of car insurance is largely because an 18-year-old typically has far less driving experience than older drivers.
Drivers between the ages of 16 and 19 are more likely to be involved in a car accident than any other age group. Drivers can, however, expect a gradual decrease as they get older and gain more driving experience. When compared to 17-year-old drivers with the same type of coverage, 18-year-old drivers on their parents’ policy pay about 6% less for full coverage.
Furthermore, the National Highway Traffic Safety Administration (NHTSA) reports that car accidents are the leading cause of adolescent deaths in the United States, with over 2,000 young drivers between the ages of 15 and 19 killed in 2019. Insurance companies charge more for young drivers to compensate for the increased risks.
Average Price of Car Insurance for 18-Year-Old Males Vs. Females
Except for California, Hawaii, Massachusetts, Michigan, North Carolina, and Pennsylvania, gender can be used as a rating factor. Male teen drivers can expect to pay higher car insurance premiums on average than female teen drivers. Why? Male drivers take more risks while driving, which can lead to more accidents and worse accidents.
What Affects the Price of Car Insurance for an 18-Year-Old?
Many factors influence the price of car insurance for an 18-year-old, including:
It is common knowledge that the more driving experience you have, the better driver you are. Even at the age of 18, car insurance companies consider you inexperienced and more dangerous on the road. This is why an 18-year-average old’s car insurance rate is higher than that of someone in their mid-twenties.
Being an 18-year-old girl may result in lower car insurance rates than being an 18-year-old boy. Some states have made it illegal to use your gender to determine your car insurance rates, but it is still done in most cases. Women, according to the Insurance Information Institute, have fewer accidents, fewer DUIs, and fewer severe accidents than men.
To protect your teen, car insurance companies consider everything, including location, to provide you with the best quote possible. When companies verify your address, the ZIP code you live in matters, so if you live in an area with a low rate of accidents, theft, and vandalism, your car insurance will usually be less expensive.
#4. Driving history
For an 18-year-old, establishing and maintaining a clean driving record goes a long way. The fewer claims, accidents, or citations you have, the less risk you are to the insurance company. Accidents happen, and when they do, don’t be surprised if your insurance premiums skyrocket.
#5. Vehicle type
If you’re looking for the best car for your teen, you’re probably considering two factors: safety and affordability. But did you know that the type of vehicle your 18-year-old drives can qualify you for auto insurance discounts and lower rates? The lower the cost of your car, the lower the cost of your car insurance. You may be eligible for discounts if your teen’s car has anti-theft technology, anti-lock brakes, or passive restraints.
Even at the age of 18, credit scores are important. Most large first-time purchases, such as renting a student apartment or purchasing a car, necessitate a credit score. As a result, it’s not uncommon for an insurance company to request your teen’s credit score. According to the Federal Trade Commission, drivers with higher credit scores file fewer claims.
#7. Coverage limitations
The amount you can pay out of pocket for your teen’s car affects the cost of your car insurance premium. The limits and deductibles you select will determine the cost of your car insurance, so it’s critical to shop around for policies.
How to Save Money on Car Insurance for 18-Year-Old Drivers
Young drivers may be able to save money on car insurance in a variety of ways. The majority of them involve taking advantage of the best car insurance discounts available, but there are a few others. If you’re an 18-year-old driver looking for ways to save money on car insurance, consider these suggestions.
#1. Excellent student discount
Teenagers with good grades in high school or college are statistically less likely to speed or drive recklessly. As a result, many insurance companies offer discounts for good grades. You will almost certainly only be eligible for this discount if you are a full-time student, and you will almost certainly need to provide a copy of your most recent grade card to demonstrate that your grades qualify. Each insurance company has its own underwriting rules, but many require you to be under the age of 25 and have a GPA of at least 3.0.
#2. Remote student discount
If you intend to attend college without driving, you may be eligible for a “distant student” discount. However, this option is usually only available if you are covered by your parent’s policy. You should be able to drive home on breaks but check with your company to see what their specific rules are.
#3. Car insurance discounts based on usage and telematics
Many businesses provide discount programs that track your driving habits using a mobile app or telematics device and then award you a personalized discount. Usage-based programs, such as Nationwide’s SmartMiles, track your mileage and allow you to pay based on the number of miles you drive because driving less means you’re less likely to be in an accident.
#4. Choose a higher deductible.
If you have comprehensive coverage, your policy will most likely have two deductibles: one for comprehensive coverage and one for collision coverage. If you file a claim for vehicle damage, you will pay the deductible and the insurance company will pay the rest of the claim. Increasing your deductible generally lowers your premium because you are willing to pay more out of pocket in the event of a claim, saving the company money. However, if you do file a claim, make sure you can afford to pay the deductible.
#5. Make use of discounts
Most insurance companies provide discounts, and taking advantage of as many as possible saves you money. In addition to good student, distant student, and telematics discounts, you may be able to save by driving a vehicle with safety features such as anti-lock brakes, getting insurance through the same company as your parents, and purchasing a renters’ insurance policy through the same company as your auto insurance, which often qualifies for a bundling discount.
How to Find the Most Affordable Car Insurance for 18-Year-Olds
Even if you are purchasing car insurance for the first time as an 18-year-old, finding the right coverage for you does not have to be difficult. It does, however, necessitate some research and comprehension, especially with auto insurance rates on the rise. It may be useful to do the following before shopping for insurance:
#1. Learn how to read a quote:
Car insurance policies include various types of coverage. Understanding what those coverage types are and what they mean may assist you in selecting the options that best meet your needs.
#2. Consider your personal requirements:
Do you want a business that has a mobile app? Do you need rideshare coverage for your Uber or Lyft job? How much money can you afford to spend on car insurance? Knowing what factors are important to you can help you simplify your shopping experience.
#3. Request quotes from several businesses:
Once you’ve determined which factors are important to you, you can obtain quotes from several companies that meet your requirements. You will be able to compare premiums, coverage options, discounts, policy features, and third-party ratings. To accurately compare rates, make sure you get quotes for the same coverage types and limits from each company.
#4. Take advantage of special offers:
Not all discounts are automatically applied. Speaking with a company representative or your agent may help you discover additional savings opportunities.
If you are completely new to purchasing auto insurance, speaking with an agent before you begin shopping for coverage may be beneficial. A licensed insurance professional can advise you on the best type of coverage for your specific situation.
Frequently Asked Questions
Can an 18-year-old get car insurance on their own?
Yes, 18-year-olds can obtain their car insurance policies. However, if you share a policy with your parents or an older driver, you could save up to 60%.
What is the average monthly cost of car insurance for an 18-year-old?
Full-coverage car insurance costs an average of $616 per month for an 18-year-old. Erie has the lowest monthly rate at $264.
At what age is car insurance cheapest?
Car insurance is generally the cheapest for drivers over the age of 55. Rates rise slightly after the age of 65 as the risk of an accident rises. However, drivers between the ages of 35 and 55 pay average annual rates that are within $100 of one another, indicating that car insurance is affordable after the age of 35.
Which car insurance is best for 18-year-olds?
Overall, we believe Geico is the best car insurance provider for 18-year-olds. We think that Geico’s rates for 18-year-olds are about 36% cheaper than the national average for that age group. It also offers a wide range of coverage options and discounts.
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