Auto Insurance for New Drivers (2024)

If you’re a new driver, you may be curious about finding the right car insurance. Finding the best car insurance companies for new drivers is a matter of finding the coverage you want at a price that works for you.

Unfortunately, auto insurance for high-risk drivers is usually higher than the average rates, but you may be able to discover different ways to save money on coverage.

As you search for new driver car insurance, one of the best things you can do is compare policies and prices from multiple providers. Doing so will give you peace of mind when you’re behind the wheel.

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Who Needs New Driver Insurance

There is no specific subset of insurance called new driver auto insurance. Still, most new drivers fall into a particular category regarding different insurance providers. Insurance companies often consider the following individuals to be new drivers:

• Teens who recently received a driver’s license
• Adults who are driving for the first time
• Immigrants or foreign nationals who have never driven in the U.S.
• Individuals with a gap in driving or insurance coverage

Auto insurance for new drivers is often more expensive than coverage for other individuals. This is mostly because of the high risk of insuring a new driver. Company rates vary, so make sure to shop around for the cheapest auto insurance companies for high-risk drivers.

Auto Insurance for Teenagers

Most insurance companies charge the highest rates for teenage drivers. This is because of their lack of experience and because they are statistically more likely to get into an accident or cause damage than any other age group.

The best way for teenagers to find affordable auto insurance rates is if they are added to an existing policy. In most cases, this will be a parent, grandparent, or guardian’s auto insurance policy. One added benefit of this arrangement is the potential to qualify for a multi-car discount.

Some insurance companies offer additional auto insurance discounts for young drivers, such as safe driving, safety features, and a good student discount.

(Read: Best Auto Insurance for Teens and Young Drivers)

Auto Insurance for Immigrants and Foreign Nationals

Auto insurance for immigrants is different because regardless of your history of safe driving in other countries, U.S. insurance companies will still consider you a new driver if you don’t have a driving history available to access.

If you’re from another country and have moved to the United States, you will need a valid driver’s license to purchase a policy. Unfortunately, even with an international driver’s permit, you will have difficulty finding car insurance without a U.S.-issued license.

The easiest way to get a driver’s license as a foreign national or an immigrant is to go to the department of motor vehicles in your state and start the process. In most cases, you will have to take a written test and a driving test, and you will have to submit the proper paperwork.

Acquiring a driver’s license in the U.S. can take a while, and your immigration status could play a role in your driving eligibility. You can speak with a representative from the department of motor vehicles to learn more and see what your options are.

Once you get a driver’s license, you can assume your rates will be higher than average, but if you’re over 25 years of age, you will probably pay less for coverage than most teen drivers in your area.

Auto Insurance for People With a Coverage Gap

Buying car insurance for first-time drivers, while expensive, is relatively straightforward. But buying car insurance if you’ve allowed your insurance to lapse is an entirely different story.

Gaps in coverage indicate to insurance companies that you’re a risk. Because of this, some companies may charge you high rates, while others may be unwilling to offer coverage at all. If you find that it’s challenging to find proper coverage, you may want to consider searching for a non-standard insurance provider.

Non-standard car insurance companies offer auto insurance for first-time drivers and new drivers. Still, these companies also provide coverage to drivers with poor credit, negative driving histories, and more. So while you will still pay higher rates for coverage, you can rest easy knowing you have proper coverage and can drive legally.

The Average Cost of Auto Insurance for First-Time Drivers

The most important factor when considering the average cost of auto insurance for first-time drivers is the person’s age. For example, the average price of a car insurance policy for a 16-year-old is around $3,400.

Fortunately, most drivers’ rates will drop by as much as 20% by age 25 if they maintain a good driving record.

Full Coverage Auto Insurance Monthly Rates for Teen Drivers

As you can see, teen and young drivers pay significantly more for car insurance.

(Read: Car Insurance for Older New Drivers)

The Best Auto Insurance for Drivers Under 25

Rates with Allstate are the cheapest among the best auto insurance companies for drivers under 25. The average rate with Allstate is just over $1,200 annually. But on average, new drivers pay around $2,750 for coverage.

For parents with young drivers, it may be cheaper to add your child to your policy instead of letting them get their own car insurance.

Auto Insurance Average Rates for Parent and Teen Drivers by Provider

New drivers who want a full coverage policy will likely find the most competitive rates with State Farm. The average cost for a full coverage policy is around $3,300 for people under 25.

Remember that rates will vary based on your personal circumstances, so it’s wise to get quotes from multiple companies.

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The Best Auto Insurance for New Drivers 25 and Up

The best insurance for new drivers over 25 may be with Allstate. The company offers the cheapest minimum coverage at under $400 per year, over 60% less than quotes from many other providers.

The cheapest full-coverage auto insurance policy for new drivers over 25 is with State Farm, with an annual rate of $1,398.

The Best Auto Insurance Company for New Drivers on an Existing Policy

Rates for drivers added to an existing family policy are cheaper than new driver rates found elsewhere. For example, Allstate, Geico, and State Farm all offer new driver car insurance rates that are cheaper than average when a new car and driver are added to an existing policy.

Geico charges just over $1,400 on average for a year of coverage, but the company charges over $3,200 for a full coverage policy.

Credit Scores Impact Auto Insurance Rates

Unfortunately, a low credit score can make your car insurance rates expensive. If possible, you should try to build good credit before purchasing auto insurance, as you will see a significant difference in how much you’ll pay.

Full Coverage Auto Insurance Monthly Rates by Credit Score

There are several states that do not permit auto insurance companies to check your credit when assigning rates, so make sure to check your local laws.

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Get Cheap Auto Insurance Rates as a New Driver

Car insurance for a new driver may be expensive, but there are a few ways you can try to lower your monthly or annual rates.

Compare Quotes Online

Each car insurance company decides on a person’s insurance rates differently. Because of this, you may find that some companies are willing to offer you auto insurance premiums that are a lot cheaper than other competitors.

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Comparing multiple quotes online allows you to find the company that would work best for you based on the coverage you want and the policy’s price.

Join an Existing Policy

If you’re a teen driver, see if your parents or grandparents can add you to their policy. While their rates will go up significantly, you’ll still save a lot more than if you were to purchase a policy on your own.

Search for Discounts

Many insurance providers offer different auto insurance discounts on coverage to help policyholders save money on their insurance rates. Some of the most common discounts for auto insurance coverage include:

• Multi-vehicle
• Multi-policy
• Defensive driver
• Good student
• Safety equipment
• Occupation

If any of the above discounts apply to you, you can speak with an insurance company to see whether you’re eligible. Some discounts help policyholders save as much as 25% on their coverage.

Choose a Lower Level of Coverage

It’s a good idea to purchase as much auto insurance coverage as you can to help keep yourself and your vehicle protected. Still, if you cannot afford a full coverage policy, you can save money on car insurance by choosing a lower level of coverage.

Choose a Higher Deductible

You can also save money on coverage by choosing a higher deductible. Unfortunately, this would mean you’d pay more out of pocket if you were involved in an accident. But it could help you save money on your monthly or annual auto insurance premiums.

Drive Safely

The best way to save money on coverage over time is by developing a superior driving record. If insurance companies can see that you drive safely and do not get involved in accidents, you will likely save a good bit of money on car insurance.

(Read: How do auto insurance companies check driving records?)

Auto Insurance for New Drivers: The Bottom Line

If you’re driving, you need car insurance. But auto insurance for new and first-time drivers is more expensive than for other age groups and categories.

To find car insurance rates that work with your budget, you can shop online and compare quotes to see which companies might work best. Also, it’s a good idea to shop around and compare car insurance quotes at least once a year to ensure you’re not paying too much for your coverage over time.

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