Jeffrey Wade
Getting car insurance for the first time can be challenging and expensive, especially for new drivers who are young or don't have much experience behind the wheel. However, there are ways to save money and get the best deal. Firstly, it's important to compare quotes from different companies, as insurers use different rating factors, which can lead to large differences in premiums. It's also worth considering staying on a parent's policy for as long as possible, as this can save thousands of dollars per year. Other ways to save include raising your deductible amount, taking a defensive driving course, and driving an older vehicle.
| Characteristics | Values |
|---|---|
| Stay on parents' plan | The best way for a young driver to get cheaper car insurance is to stay on their parents' plan. |
| Compare rates from different companies | Seeking out auto insurance quotes from different companies can help find the best rate. |
| Drive an older vehicle | New drivers looking to save money should consider driving an older vehicle. |
| Raise your deductible amount | Raising the deductible amount can help lower the premium as it reduces the risk for the insurer. |
| Discounts | Insurers offer discounts for various reasons, including good student discounts, defensive driving course completion, driving habits, and multiple vehicles on the same policy. |
| Online purchase | Buying insurance online can be a simple way to access cheaper rates. |
| Pay-per-mile insurance | This type of insurance can help lower costs as you pay for the time spent driving. |
| Specific companies | Certain companies are known for offering cheaper rates for new drivers, including State Farm, USAA, Erie, Auto-Owners, Geico, and American Family. |
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What You'll Learn
Compare quotes from different companies
Comparing quotes from different companies is a simple and effective way to find cheap car insurance for new drivers. It is a quick way to determine if you are getting the best deal. This is because insurers underwrite policies based on different rating factors, which can lead to large differences in premiums. For example, Erie has the lowest sample rates for teen drivers, while USAA has the cheapest rates for both female and male young adult drivers. State Farm has the cheapest liability car insurance for most new drivers under 21, at $224 a month, and the cheapest full coverage for young new drivers at $451 a month. However, USAA is only available to military families.
When comparing quotes, it is important to consider your personal circumstances and the level of coverage you require. Car insurance premiums are based on a range of factors, including your age, location, credit history, driving history, and the type of car you drive. For example, older vehicles are generally cheaper to insure than newer models. You should also consider the coverage level you choose, as this will impact your rates. Basic coverage is a full-coverage policy with elevated liability limits, which roughly 38% of The Zebra's customers opt for.
It is recommended that new drivers purchase full coverage car insurance if they can afford it, as their risk of getting into an accident is higher. However, it is also important to assess which types of coverage you really need. For example, if you are a safe driver, you may not need the accident forgiveness feature of your policy. You can also save money by raising your deductible amount, but you must ensure that this amount remains affordable.
In addition to comparing quotes, new drivers can also access cheaper rates by purchasing their policy online. Some insurers also offer discounts for various reasons, such as completing a defensive driving course, being a good student, or having low mileage.
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Stay on your parents' plan
One of the cheapest ways to insure a new driver is to stay on your parents' plan. This is often the most cost-effective option for new drivers as it allows them to take advantage of their parents' existing insurance coverage and benefits. Here are some things to keep in mind when considering this option:
First, it's important to check with your parents' insurance company to see if you are already covered under their policy. Many policies automatically cover family members who live in the same household, even if they are not specifically listed on the policy. If you are already covered, make sure you understand the extent of that coverage and whether there are any restrictions or limitations for new drivers.
Second, if you are not already covered under your parents' policy, it may be possible to be added as an additional driver. This can often result in significant savings compared to purchasing your own policy. Insurance companies typically offer discounts for multiple drivers on a single policy, and you may also benefit from any loyalty or bundling discounts your parents may have already accrued. Keep in mind that adding a new driver can increase premiums, especially for young or inexperienced drivers, so it's important to discuss this option with your parents and weigh the potential costs and benefits.
Another advantage of staying on your parents' plan is the potential for a longer history of coverage, which can lead to better rates. Insurance companies often offer lower premiums to drivers who have been continuously insured for a longer period of time. By remaining on your parents' policy, you may be able to build up your own insurance history, which can result in better rates when you eventually purchase your own policy.
It's also worth considering the type of vehicle you will be driving and how it could impact insurance costs. If you are added to your parents' policy, you may be able to take advantage of any discounts or benefits associated with their vehicle. For example, if their car is equipped with safety features, this could result in lower premiums for all drivers on the policy. Additionally, insurance companies often offer discounts for insuring multiple vehicles, so if your parents have more than one car, you may be able to secure a more favourable rate by being included under their coverage.
Finally, staying on your parents' plan can provide an opportunity to establish a good driving record. Insurance rates are heavily influenced by your driving history, and any accidents, violations, or claims can result in increased premiums. By remaining on your parents' policy, you can benefit from their safe driving record, which can help you secure lower rates in the future.
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Raise your deductible amount
One of the simplest ways to get cheap car insurance is to raise your deductible amount. This allows your auto insurer to carry less risk, which can translate to lower premiums. However, it is important to ensure that your insurance deductible is set at an affordable level. This is because the deductible is the amount you need to pay out of pocket before your insurance company covers the rest of the bill.
When deciding on a deductible amount, it is essential to consider your financial situation and ability to cover the deductible in the event of an accident or claim. While raising your deductible can lead to significant savings on premiums, it is crucial to balance this with the potential out-of-pocket expenses you may incur if you need to make a claim.
Insurers typically offer a range of deductible options, and it is worth discussing these with your insurance provider to understand the impact on your overall costs. By choosing a higher deductible, you can reduce your premiums, but it is important to ensure that the deductible remains within a manageable range for your financial situation.
Additionally, it is worth noting that while raising your deductible can lower your premiums, it is not the only factor influencing the cost of car insurance. Your premium is also determined by your driving history, the type of car you drive, your location, and other factors. Therefore, it is beneficial to explore various cost-saving measures, such as comparing rates from different insurers, taking advantage of discounts, and considering the level of coverage you require.
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Take a defensive driving course
One of the best ways to reduce the cost of insurance for new drivers is to take a defensive driving course. Many insurers offer discounts to drivers who have completed an approved defensive driving course. These courses teach drivers how to stay alert, obey the law, and avoid accidents or lapses that could affect their insurance rates for years. Defensive driving courses are a great way for new drivers to improve their skills and save money on car insurance.
In addition to defensive driving courses, new drivers can also save money by staying on their parents' insurance policy as long as possible. This can save them thousands of dollars per year, and most of the time, the rates will be lower than if the new driver were to purchase their own policy. College students can usually stay on their parents' policy as well, as long as they don't drive their own car while living away from home.
Another way to save on car insurance is to compare rates from multiple companies. Different insurers use different rating factors, which can lead to large differences in premiums. By shopping around and comparing quotes, new drivers can find the best rates and coverage options for their needs. It's important to carefully assess what type of coverage you need and how much you can afford to pay out of pocket before choosing a policy.
Additionally, new drivers can save money by choosing a car that is cheaper to insure. The type of car you drive can significantly impact your insurance rate. Older, less expensive vehicles tend to be cheaper to insure than newer, more expensive models. The make, model, age, and safety features of a vehicle are all factors that insurers consider when setting rates.
Finally, new drivers can also take advantage of discounts offered by insurance companies. Many insurers offer good student discounts, multi-vehicle discounts, and low mileage discounts. By combining these strategies, new drivers can significantly reduce the cost of their car insurance.
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Drive an older vehicle
One of the best ways to save money on car insurance as a new driver is to drive an older vehicle. The make, model, and year of a car can affect insurance rates, and newer cars tend to be more expensive to insure.
When it comes to choosing a vehicle, opting for an older model can be a strategic choice for new drivers looking to save on insurance costs. Insurers consider newer cars to be more valuable, and thus more expensive to repair or replace in the event of an accident. As a result, they often come with higher insurance premiums. On the other hand, older vehicles have usually depreciated in value, leading to lower insurance rates.
Additionally, older vehicles may have fewer advanced features and technologies, which can also contribute to lower insurance costs. Modern safety features can reduce the risk of accidents and lower repair costs, which insurers take into account when setting premiums. So, if you're a new driver, consider choosing a vehicle that is a few years old or one without all the latest bells and whistles.
However, it's important to note that older vehicles may have higher maintenance costs, and they might not have the same safety features as newer models, which could increase the risk of accidents. Therefore, it's essential to balance the potential savings on insurance with the potential costs of maintenance and repairs, as well as consider the safety features you may be giving up.
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Frequently asked questions
The cheapest way to insure a new driver is to add them to their parents' insurance policy. This is a requirement for drivers under 18, and staying on their parents' policy for as long as possible can save young drivers thousands of dollars per year.
New drivers can save money on insurance by comparing rates from different companies. They can also raise their deductible amount, which allows the insurer to carry less risk, resulting in lower premiums.
The cost of insurance for new drivers is influenced by their age, location, credit history, driving history, and the type of car they drive.
USAA has the cheapest rates for both female and male young adult drivers, followed by Nationwide and Geico. Erie has the lowest sample rates for teen drivers, followed by Auto-Owners, USAA, and Geico. State Farm has the cheapest liability insurance for new drivers under 21, averaging $224 a month.
