The Cheapest Car Insurance Companies for New Drivers in 2024

New drivers lack experience, and many tend to pay higher-than-average rates since insurance companies don’t have a driving history to review. Likewise, many new drivers are also teens, who are statistically more likely to text, speed, and engage in other dangerous behaviors, which leads to an increased likelihood of causing an accident and filing a claim.

While all insurers charge higher car insurance premiums to inexperienced motorists, some companies — including Erie, GEICO, and USAA — are cheaper than others. Read on to learn more about some of the best auto insurance companies offering the cheapest car insurance for these high-risk drivers, as well as a few tips on how to save even more.

Key Takeaways:

• New drivers can expect to pay well over the national average of $129 per month for car insurance.
• Erie, GEICO, and USAA offer some of the cheapest car insurance for new drivers, on average.
• New drivers should ask about savings opportunities and discounts to reduce premiums.

The Best Cheap Car Insurance Companies for New Drivers

Every driver is different, so there’s no one insurer offering the lowest prices for every new driver. Many factors — including location, age, the vehicle they drive, and more — can affect how much new drivers pay for auto insurance. Insurance costs are also affected by whether a teen driver is on their parents’ insurance plan or buys stand-alone coverage.

That being said, while prices vary, some insurers provide coverage for young drivers that is more affordable than others. We’ve analyzed average insurance premiums, J.D. Power ratings, and policy features to find three of the best cheap car insurance companies for drivers who are new to the road. The following companies all offer extremely competitive rates and other great features for this group.

Erie

Average premium: $194 per month

Compare.com rating: 3.8 out of 5

Pros

• Above-average J.D. Power customer satisfaction ratings
• Great rates for teens
• Multiple discounts available for young drivers

Cons

• Only available in 13 states
• Good student discount not available
• Poorly rated mobile app

Erie Insurance offers some of the most competitive prices for teen drivers of any insurer, at just $188 per month for liability policies. And it’s an especially great choice for young teen drivers who still live at home because it offers an additional discount for unmarried drivers under 21 who live with their parents.

Erie also offers the youthful driver longevity discount for younger drivers who previously had coverage under another Erie auto policy, as well as a driver training discount for drivers younger than 21 who’ve completed an approved training course. While the insurer doesn’t have a good student discount, it still provides more opportunities than many competitors for new drivers to lower rates on insurance products.

On the other hand, its mobile app receives low ratings and lacks important features, including support for Apple Wallet, which many young drivers prefer.

GEICO

Average premium: $193 per month

Compare.com rating: 4.65 out of 5

Pros

• Affordable premiums for new drivers
• Good student discounts available
• Discounts available for alumni associations

Cons

• Below-average J.D. Power Customer Satisfaction scores
• Limited local agent network
• Gap insurance not available

GEICO’s base rates are among the most affordable for teens, at just $118 per month for liability coverage. Plus, students with at least a B average qualify for the company’s good student discount. The insurer also partners with several alumni and university organizations to provide additional savings opportunities for young drivers.

The GEICO mobile app earned 4.8 out of 5 stars on the App Store, but its J.D. Power Customer Satisfaction rankings are mixed. GEICO’s DriveEasy program offers additional opportunities to save, especially for new drivers who drive safely.

USAA

Average premium: $176 per month

Compare.com rating: 4.38 out of 5

Pros

• Competitive rates for new drivers
• Top marks in J.D. Power’s Customer Satisfaction Index
• Good student discount available

Cons

• Must be a USAA member to qualify
• Few discounts available for young drivers
• No local agent network

USAA is a good option for military members or young people who qualify based on a family relationship with someone in the armed forces. In fact, USAA’s premiums for new drivers are the most affordable, on average, of any insurer. The company also offers a good student discount but doesn’t have quite as many savings opportunities for young people as some competitors.

USAA’s mobile app is also top-rated and offers some options other competitors don’t, such as pay-as-you-go insurance, which prices premiums based on how often and how safely you drive.

How Much Does Car Insurance Cost for New Drivers?

Car insurance for new drivers is more expensive than the average cost for all motorists. That’s because new drivers’ lack of experience on the road means they’re more likely to cause accidents and file car insurance claims.

The table below showcases the 10 cheapest car insurance companies for new drivers, according to Compare.com data. The rates you see are for teen drivers since that age group makes up most of the newer drivers on the road.

USAA, GEICO, and Erie offer the most affordable rates for teen drivers, with average rates that are less than half of what some competitors charge.

These insurers also offer several discounts for teen drivers and tend to be affordable across the board for all motorists. Other insurers — such as Allstate, Progressive, SafeAuto, and Nationwide — charge more than $400 per month for teen drivers, on average.

5 Ways New Drivers Can Save on Car Insurance

It’s important for new drivers to try to find ways to save on car insurance since premiums are so high for this group. Here are a few tips to reduce your rates if you’re a new driver:

• Earn good grades. Most insurers offer good student discounts to young drivers with a B average or higher.
• Complete a defensive driving class or driver’s education course. Many companies offer discounts for drivers who have received formal training. Be sure to check with your insurer to find out its course requirements.
• Avoid accidents and tickets. Insurance rates increase for new drivers who have a ticket or accident on their record since things like speeding tickets make insurers believe you’re high-risk. Always follow the rules of the road if you want the best rates.
• Shop for coverage. Some insurers charge more than double their average rates for new drivers, according to our research. Shop around and get several car insurance quotes to find a company providing the most affordable car insurance.

Discounts for new drivers

Many insurance companies offer discounts for drivers. The table below shows some common opportunities for new drivers to reduce car insurance rates.

Most insurers offer discounts that help new drivers save, including for taking a driver’s education course or for earning good grades. Inexperienced drivers who purchase a new car can also save if they choose an insurer offering a new vehicle discount.

Signing up for paperless statements and opting for an online quote are also easy ways to reduce your overall auto insurance costs.

How to Get Car Insurance for the First Time

If you’re buying car insurance for the first time, don’t be intimidated. You can find an affordable policy quickly and easily if you follow these steps:

1. See if you’re eligible to be covered under a parent’s policy. It’s often cheaper and easier for new teenage drivers to be added to a parent’s policy rather than getting their own coverage.
2. Research coverage types. Most states require liability insurance, but you should also look into additional coverages to make sure you’re fully protected. This can include collision coverage to pay for damage you cause your own vehicle and comprehensive coverage to pay for damage caused by vandalism, animals, weather, or other “non-collision events.” Often, a full-coverage policy is a good choice, even though you’ll pay higher rates for the extra protection.
3. Apply for your new policy. You’ll need to provide information about yourself, your vehicle, your driving history, and your coverage needs before purchasing your new policy. Many companies offer same-day coverage, which means you can be on the road and driving legally in no time.

New Driver Car Insurance FAQs

Car insurance can be confusing, especially if it’s your first time buying a policy. We’ve answered some of the most commonly asked questions to help simplify the process.

How much is insurance for a new driver?

The cost of insurance for a new driver depends on many factors, including age, location, and coverage levels. The cheapest insurers charge average monthly rates between $176 and $194 for new teen drivers. But some insurance companies charge upwards of $400 per month to provide the same coverage. That’s why it’s so important to compare quotes from multiple companies before making a decision on your next policy.

What are the cheapest cars to insure for first-time drivers?

The cheapest cars to insure for all drivers are the Subaru Crosstrek and the Honda CR-V, according to Compare.com data. Cars with more advanced safety features and better anti-theft technologies tend to be cheaper to insure because they present a reduced risk of an insurance claim.

Does a new driver need car insurance?

Yes, all drivers in nearly every state must have car insurance to drive legally — including new drivers. You typically must provide proof of insurance to buy or rent a vehicle or when requested by law enforcement after an accident or at a traffic stop. It’s illegal to drive without coverage in most states, and you could be held personally responsible for repair and medical costs you cause while driving uninsured.

What is the best insurance for new drivers?

The best insurance for new drivers depends on many things, including your age, where you live, whether you have coverage through a parent’s policy, and the types of coverage you need. New drivers should shop around and compare rates to find the most affordable auto insurance.

Methodology

Data scientists at Compare.com analyzed more than 50 million real-time auto insurance rates from more than 75 partner insurance providers in order to compile the quotes and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.

All the quotes listed in this article have been gathered from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide drivers with insight into how auto insurance companies determine their premiums.

Sources

1. J.D. Power, “2023 U.S. Auto Insurance Study,” accessed February 10, 2024.
2. Experian, “Do Auto Insurance Companies Consider Your Credit,” accessed February 10, 2024.
3. Automoblog, “Can You Get a Driver’s Education Car Insurance Discount?” Accessed February 10, 2024.
4. Pennsylvania Insurance Department, “Auto Insurance for Young Adults,” Accessed February 10, 2024.
5. Texas Department of Insurance,” Auto Insurance Guide,” Accessed February 10, 2024.