Driving for the first time is an exciting milestone for many teenagers. However, as a parent, you may have concerns regarding car insurance for teenagers, especially regarding affordability.
Your auto insurance rates will rise when you add a teen driver, but prices vary by company and state. Some companies also offer discounts to help you stay on a budget. You can add a teen to most plans, but some parents choose to buy a separate auto insurance policy.
Some states allow a 16-year-old to get a car insurance policy independently, but most states require you to be at least 18 years old to purchase insurance. So when we talk about car insurance for teenagers, we mean the cost of adding them to a parent or guardian's existing policy.
Here are the best auto insurance companies for insuring teen drivers.
Best Car Insurance for Teens
- Best for cheap coverage: Erie Auto Insurance
- Best for military: USAA Auto Insurance
- Best for bundling: Nationwide Auto Insurance
- Best for low credit scores: GEICO Auto Insurance
- Best for discounts: State Farm Auto Insurance
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817
A++
- Nationwide presence
- High customer satisfaction and claims satisfaction rankings
- Discounts for bundling insurance products
- Quotes are only available through captive agents (who only quote State Farm)
- Pricing may be higher or products unavailable for high-risk drivers
- Rates may rise quickly for households with teen drivers
State Farm auto insurance offers coverage across all 50 states and Washington, DC. It has comprehensive, collision, and liability coverage along with less common options like rideshare coverage.
State Farm
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- Many discounts and options to bundle insurance policies
- high customer satisfaction according to JD Power's auto insurance study
- Long history in the insurance industry
- Not available in Hawaii
- May not provide the most competitive rates for higher risk drivers
- Ranks high in customer satisfaction
- Discount for students and vehicle safety
Erie Auto Insurance: Best for Cheap Coverage
Erie Auto Insurance, on average, costs $2,532 to insure an 18-year-old driver on a parent's policy. This makes Erie the cheapest option for parents with teen drivers. While it has high marks in claims satisfaction and has relatively affordable rates, it is only available in 12 states.
Other features and discounts include:
- Diminishing deductible. Offers up to $100 off your deductible for every year a driver is claims-free up to a maximum of $500.
- YourTurn program. YourTurn is a telematics smartphone app that allows safe drivers to earn cash. Drivers ages 16-23 can earn rewards of up to $10 every two weeks, and ages 24+ can earn rewards of up to $5 every two weeks, based on driving 50 tracked miles and the participating driver's score during the scoring period. It may not be available in all states.
- Rate lock. Allows customers to lock a rate for an indefinite period as long drivers and cars remain the same.
- Auto security endorsement.If your vehicle is less than two years old and totaled, it will be replaced with the newest model year. If your vehicle is older than two years, it will be replaced with the same model but two years newer and 30,000 fewer miles than your original vehicle.
- Pet coverage. If your pet is injured in your vehicle.
Read our Erie car insurance review.
USAA Auto Insurance: Best for Military
USAA Auto Insurance will cost parents $2,588 on average. USAA is one of the most affordable options for teen drivers, however, it is only available to active-duty military, veterans, and their families.
Other features and discounts include:
- Safe Pilot— This app gives drivers discounts based on driving behavior and mileage.
- Rideshare coverage— Coverage if you deliver for an app-based Transportation Network Company (TNC), like Uber or Lyft.
- Accident forgiveness— If you're accident-free for five years, the policy surcharge will be waived for your first at-fault accident.
- Pro-Active Crash Detection— You'll be prompted to start the claims process when a collision is detected.
- Telematics Enabled Claims (TEC)— Expedites the claims process for Safe Pilot app users by letting claims reps auto-fill data.
- Good student discount— A discount for students who maintain a certain grade average.
Read our USAA car insurance review.
Nationwide Auto Insurance: Best for Bundling
Nationwide Auto Insurance is offered at approximately $3,406 for parents with teen drivers. It ranks high in claims satisfaction and offers many discounts and bundling opportunities to curb your auto premiums. Nationwide is also available everywhere in the U.S.
Other features and discounts include:
- Accident forgiveness - Avoid a rate increase after the first at-fault accident or minor violation on your policy.
- Vanishing deductible - Earn $100 off your deductible for each year of safe driving, up to $500.
- Roadside assistance - 24/7 emergency help if you need fuel, a tire change, a jump-start, or a tow.
- Total loss deductible waiver— Have the physical damage deductible (comprehensive or collision) waived in the event your car is totaled in an accident.
- SmartRide - Earn discounts for using your smartphone to track driving habits.
- SmartMiles - If you're an infrequent driver, pay less with a flexible monthly rate based on how many miles you drive.
- Good student discount —Discount for students 16 to 24 years old who maintain a B or better.
- Anti-theft discount - Get a discount if your vehicle is equipped with certain anti-theft devices.
Read our Nationwide car insurance review.
GEICO Auto Insurance: Best for Low Credit Scores
GEICO Auto Insurance has an average premium of $3,432 for parents with teen drivers. It has high marks in claims satisfaction and is available everywhere in the U.S. GEICO is also friendly to drivers with poor credit scores.
Other features and discounts include:
- Military - Receive up to 15% off for military and up to 25% for emergency deployment.
- Federal employees - Get up to 12% off for active or retired federal workers with GS-7 or above designation.
- Partner groups - Discounts for alumni associations, fraternities and sororities, and professional organizations that have partnered with GEICO.
- Airbag discount - Receive up to 23% off for a vehicle with airbags.
- Anti-lock brakes - Get up to 5% off for a vehicle with factory-installed anti-lock brakes.
- Anti-theft system - Receive up to 23% off for a vehicle with a built-in anti-theft system.
- New vehicle - Get up to 15% off for three models years or newer vehicles.
- Good driver - Receive up to 22% off if you are five or more years accident-free.
- Good student - Get up to 15% off for high school or college students with a B or better grade average.
Read our GEICO auto insurance review.
State Farm Auto Insurance: Best for Discounts
State Farm Auto Insurance is the most expensive option on this list with premiums priced at $5,176. However, State Farm's premiums are still lower than the national average. Additionally, it offers a number of discount opportunities for bundling and safe driving and has a national presence with high marks in auto claims satisfaction.
Other features and discounts include:
- Rideshare insurance —Covers you if you operate your car as an Uber or Lyft driver.
- Rental car reimbursement— Covers the costs of a rental car when your car is in the shop.
- Drive Safe & Save— This telematics smartphone app gives drivers discounts based on driving behavior and mileage.
- OnStar discount— Earn a discount by enrolling your eligible OnStar-enabled vehicle in Drive Safe & Save.
- Steer Clear discount— Young drivers up to age 25 can earn a discount for demonstrating safe driving habits.
- Accident-free discount —Get a discount if State Farm has insured your car for at least three consecutive years without an accident.
- Good student discount —Discount for students 16 to 25 years old enrolled full-time in high school or college with a B or 3.0 GPA or a class ranking in the top 20%.
- Student away at school discount— This discount applies if your student moves away to school and only uses the car while at home during school vacations and holidays.
- Defensive driving course discount— Taking a driver safety course may help you get car insurance discounts with State Farm.
Read our State Farm car insurance review.
Why You Should Trust Us: How We Chose the Best Cheap Car Insurance for Teenagers
Finding the right auto insurance for your family can save you money. It also ensures you'll be protected if you get in an accident. Teens inevitably drive auto insurance rates up, but it doesn't have the same impact with every auto insurance provider.
We look at the many factors that go into choosing auto insurance from price to coverage, discounts, customer service, and much more. Then we provide more information so you can see what makes sense. Most auto insurance companies are not licensed in all 50 states. However, many of the best options we've seen are.
Read more about how Business Insider reviews auto insurance.
FAQs
On average, premiums for an 18-year-old driver will cost $4,931 annually.
The type of car insurance you should buy will depend on how well your teenager drives and the value of the car. As teenagers pose a higher risk of accidents, you may consider buying full coverage car insurance with some accident forgiveness benefits.
Yes, your car insurance premiums can rise if your teenager gets in an accident while covered under your policy, and you have to file a claim.
Yes, some car insurance providers offer discounts for teenagers, like good student discounts and family bundling deals.
The youngest age to get car insurance in most states is 18. Some states allow you to get an independent auto insurance policy at age 16, but in most cases you'll have to add a teen under 18 to an adult's policy.