Career Advice

The Best Car Insurance for Teens in 2021

By: Daniel Robertshaw
Jul 30, 2021 • 5 min read

The Best Car Insurance for Teens in 2021

We’ve all been there when we were younger. The pure ecstasy of finally finishing your Drivers Ed class at 15/16 years old. You studied for hours and hours, trying to remember every little detail. Every sign. Every road marking. Every rule. The buildup of anxiety and stress all led up to this pivotal moment. You’re sitting at the DMV, waiting for your number to be called. You nervously tap your fingers as the stress of failing goes through your mind.

You know you can’t get even one of the sign questions wrong, or you fail. Your number is called as you walk up and sit at the old DMV computer. Clicking through, you try to remember everything you learned in the flimsy booklet they gave you. You start questioning your decision. Wait, does that sign mean this? Or maybe it could mean that instead? In the end, you see that glorious word: PASS. You’re now officially a licensed driver.

Intro to car insurance for teens

Getting your driver’s license as a teenager is such an exciting time and a big step in your transition to adulthood. You can drive to school, drive to the mall, drive wherever you want. So exciting! Now for parents, it’s another story. Whereas the excitement of newfound freedom runs through your kids’ veins, you’ve got one thing on your mind: Increased, expensive insurance rates. Insurance rates for teenage drivers are some of the highest of any demographic.

It’s a stressful time knowing that your rates will skyrocket now that you have to add your new teenage driver. But it doesn’t have to be. This guide will detail everything you need to know about car insurance for teenagers. You’ll learn the average insurance costs for adding a teenage driver to their own insurance policy and the average cost of adding them to your current insurance policy. You’ll also learn why these prices are so high and the top 5 insurance companies you can use to get the best deal.

car insurance for teens

How much is average insurance for teenage drivers?

Now, if this is your first time hearing that insurance rates are sky high for teenage drivers, you may be wondering to yourself just how much it will cost to put your teenage driver on their own policy. According to Nerdwallet, these are the national average insurance costs for teenage drivers, separated by each year:

  • 16-year-olds: $6,613 for full coverage; $2,733 for minimum coverage.
  • 17-year-olds: $5,373 for full coverage; $2,206 for minimum coverage.
  • 18-year-olds: $4,837 for full coverage; $1,938 for minimum coverage.
  • 19-year-olds: $3,716 for full coverage; $1,451 for minimum coverage.

Compared to the national average for adults over 25 of $1,674 per year for full coverage, this is a very drastic increase. However, these prices are for those who want to put their teens on their own, separate policies.

For most families, it makes more sense to simply add them to your existing policy. However, you won’t escape the financial burden that they will place on you. According to insurance.com, the average household’s car insurance bill rose 152% when adding a teenage driver. This average is even higher when just considering adding teenage boys. When adding a teenage boy, the average bill rose 176%, compared to the 129% for adding a teenage girl.

Why is insurance so high for teenage drivers?

Now you know that Insurance rates for teenage drivers are some of the highest out of any demographic. New teenage drivers face insurance rates higher than pretty much everyone else. But why is that? Surely that’s not fair?

Insurance rates are determined by how much of a liability you will be to the insurance company. Think of it as a risk assessment. How much risk will you be to an insurance company? How likely are you to get in a car accident? Young drivers with no experience on the road are at the greatest risk of being involved in a car accident and, because of that, are considered very risky for companies to insure.

According to the CDC, in 2019, almost 2,400 teens in the United States aged 13–19 were killed, and about 258,000 were treated in emergency departments for injuries suffered in motor vehicle crashes. On average, that means that every day, about seven teens aged 13–19 died due to motor vehicle crashes, and hundreds more were injured.

As we saw in the previous section, on average, insurance rates drop almost 50% in the 3 years from 16 to 19 years old. This drastic decrease aligns with the rate of risk assumed by the auto insurance company 16-year old drivers have the most some of the highest crash rates, and crashing is about twice as high as drivers that are 19 years old.

car insurance for teens

What are the best car insurance policies for a teenage driver?

Now let’s get to the bread and butter of this guide. We’ve learned about the average prices for car insurance for teenagers, but what companies can I use to get the best deals for my teen driver? We’ve done the research and listed 5 of the best companies that you can use in 2021 to get the best deal, in no particular order.

Geico

15 minutes could save you 15% or more with student discounts for college students who maintain good grades. Geico is the second-largest auto insurance company in the USA and has gained popularity through the years from their humorous commercials with their animated gecko mascot. They offer insurance policies in every state and 24/7 online support.

Geico is a great option to use to insure your teenage driver. Discounts are given to college students who maintain good grades and for members of certain student organizations. You can also take an optional driver training program that will reduce your overall insurance rate.

Features

  •  15% Student Discount for college students who maintain a B average or better
  • Discount for those who complete a driver training program
  • Discounts are given to members of certain student organizations

To learn more about adding a teen driver to a Geico policy, you can read more here.

Allstate

Allstate is the fourth largest auto insurance company in the USA and offers insurance policies in every state. When it comes to teenager drivers, Allstate offers some great discounts for college students. In addition to a large discount to those students who keep a B average or better, Allstate offers an additional bonus to those at college whose car is at least 100 miles away from them. This incentive means that college students who don’t have their car are not burdened with the full cost of premium car insurance for a car they rarely use.

Features

  • 20% Student Discount for college students who maintain a B average or better
  • 20% Resident Discount for students who attend college 100+ miles from home and don’t have their car with them

To learn more about adding a teen driver to an Allstate policy, you can read more here.

Nationwide

As we discussed earlier, teenage drivers come with the highest insurance rates out of any demographic. This is because of the higher risk of getting in a car accident. Being inexperienced and new to the road, it’s very likely that your new teenage driver will get into an accident. Well, what happens to your insurance when you get in an accident? Your rates rise even more. While this may be the case for most companies, it isn’t for Nationwide. Nationwide offers an accident forgiveness program that extends to drivers under the age of 18, meaning your teenage driver can get into an accident, and it won’t cause your insurance rates to soar.

car insurance for teens

Features

  • Accident forgiveness plan for teenagers
  • Student Discount for both high school and college students who maintain a B average or better
  • Discount for those who complete a driver safety program
  • Multi-car discount for families who bundle insurance coverages

To learn more about adding a teen driver to a Nationwide policy, you can read more here.

Progressive

Progressive is the third most popular auto insurance company in the US, and another whose popularity has risen due to its humorous commercials. But don’t be fooled; Progressive is not only popular for its funny advertisements. They also offer one of the best discounts for teenagers who gain a proven track record of driving safely. Drivers under 25 who go three years without any accidents or violations can earn upwards of 30% off their annual premiums.

Features

  • Discount for parents who are insuring a driver younger than 18
  • 10% Student Discount for high school and college students who maintain a B average or better
  • Multi-car discount for families that bundle insurance coverages
  • A snapshot rewards program that rewards drivers based on how they drive

To learn more about adding a teen driver to a Progressive policy, you can read more here.

USAA car insurance for teens 

United Services Automobile Association (USAA) is an auto insurance company that offers insurance specifically to current or former military members. While it’s exclusive to only military and ex-military people, they do offer a large range of discounts for your teen drivers. A student discount is given to students that maintain good grades throughout their schooling. You can also encourage safe driving into your teen driver at an early age. If they maintain a good driving record for more than 5 years, you’ll get a large safe driving discount.

Features

  • Student discount for students who maintain a B average or better
  • Multi-car discount for familiar that bundle insurance coverages
  • Driver training discount when eligible drivers complete a basic driver training course
  • Safe driving discount for those who maintain a good driving record for more than 5 years

To learn more about adding a teen driver to a USAA policy, you can read more here.

Best of luck finding an insurance plan that fits your personal needs! We hope this guide helps you in your search.

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