Best Car Insurance For Teens: A Complete Guide

Teen driver with friends

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Learning to drive has long been considered a rite of passage across large swathes of America. But this can be a scary time for parents. Not only does this represent a new kind of independence for your child, but it also means more risks for your family. Whatever your concerns, it makes sense to do your research so you can find the best car insurance for teens.

Teen drivers are about three times more likely to be involved in serious accidents than drivers over the age of 20. This knowledge can be nerve-wracking. It also has some extra costs when your teen starts driving. Namely, that your rates will increase. Even still, it’s nearly always cheaper to add a teen driver to your plan rather than buy them their own.

It’s important to consider all your options. And bringing a teen driver onto your insurance is a chance to look for the right insurance for your whole family.

Pricing the Best Car Insurance for Teens

Earlier, we said that it’s pretty much always cheaper to add a young driver to your insurance policy instead of buying them their own. Let’s look at some numbers.

LendingTree’s QuoteWizard has a great guide to average monthly premiums for drivers in your household by age. In their example graph, a parent pays about $111 a month in car insurance premiums. After adding their teen, they would pay $298 a month. That calculates out to a premium increase of about 168%. This is absolutely significant.
However, that same average cost for a teen driver on their own would be a hefty $397 a month. Yikes.

While you will pay through the nose if you add a young driver to your plan, it won’t nearly be as expensive as if you get them solo insurance. It’s the difference between $3,576 year in insurance premiums and $6,096—almost twice as much.

There is some good news. Most insurers will add a teen driver to your policy for free if they have their learner’s permit. As we always recommend, you need to check with your insurer so you know for sure, but that is something most policies offer. This may not make it cheaper for your teen to drive, but it will make it cheaper for them to learn.

Best Car Insurance for Teens by Company

Exact rates and premiums will vary based on a lot of factors—such as the age and safety of your car, where you live, and even your child’s gender. However, certain insurance companies offer programs and breaks that you should keep in mind when bringing a young driver onto your plan or looking for a plan that would be best to move the whole family to as a way to save money.

Nationwide

Nationwide offers Accident Forgiveness for teen drivers. This means that if your teen is in even a mild accident in their first year of driving, it will keep your rates from going up after a single incident. Exact availability may vary, and this is an add-on that you will pay more for, but it could be worth it.

State Farm

State Farm is one of the insurance companies that offers a discount if a teen driver is also a student with good grades. As many younger folks are in school, this can be another financial incentive to encourage them to do their best on schoolwork. State Farm also offers insurance discounts for learners that enroll in certain driver’s education programs.

GEICO

GEICO offers similar programs to those listed above—with a guaranteed repair program added on for good measure. Like State Farm, they have driver education incentives and like Nationwide, they have policy options that might make things a little easier should your teen have a minor accident. Guaranteed repair is one of those, which might help your family car get back in business a little faster if there’s a short lapse in judgment.

Wait Until Later

Sometimes, the best choice is just to wait.

This could be a hard pill to swallow—both for teens anxious for more freedom and for parents in suburban or rural areas that are tired of ferrying students around to friends or extra-curriculars. But the fact remains that insurance rates decrease after drivers turn 20. Additionally, many states have fewer restrictions on drivers getting their license after age 18.

Waiting until a young person is older to pursue a driver’s license could mean saving on premiums for an extra 2-4 years and avoiding higher insurance rates. As we said earlier, it’s also safer. The ages of 16-19 are some of the most dangerous times in a new driver’s life.

Your child wouldn’t be alone either. In 2018, Statista found that only about 25% of people get their driver’s license the year they turn 16 compared to 46.2% in 1983. For many reasons, it’s becoming more common to wait to start driving independently until someone is much older.

Any new driver will end up paying more for car insurance, but it may make more sense for some families to hold off for a little bit.

Considering All Car Insurance Options for Teens

When it comes to getting your teen set up to drive safely and with coverage, there’s a lot you can control and a lot you can’t. You can’t promise your new driver won’t make a mistake, just like they could very well hit every safe driving milestone to help bring your insurance down. Making sure you have a car insurance company that is friendly to families with learners is something you can control. Just like figuring out the best driver’s education program or whether your old car is safe for your teen, looking for new insurance requires a little work.

But as we said, insurance companies will often allow your student to learn for free. Even if your teen can’t drive right away because of the cost of insurance or a new (well, probably used) car, there are still huge advantages to getting a driver’s license. One of these is that it makes it easier to register to vote. It also means that the second you or your teen do have the funds, they’ll be able to apply for insurance right away.

Cora Walker

Cora Walker

Cora is a Northwest-based writer and editor who wants to make information as accessible as possible in the internet age. Video games are this writer’s primary vice. With a degree from the University of Washington as well as 5+ years of experience in web writing and publishing, Cora is here to share financial tips from experts and talk about good habits.

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