The Best Auto Insurance for College Students

Allstate’s comprehensive discount programs provide the best balance of flexibility and affordability for most college students.

Pay-Per-Mile Insurance Coverage

Some students do not use their cars on a regular basis. Perhaps you drive home a few times a semester, but you don’t need to drive to class every single day. In that case, Allstate’s pay-per-mile insurance Milewise may be the most affordable student option.

With Milewise, you pay a daily base rate as well as a per-mile rate instead of a pre-set monthly or annual premium. For instance, if your daily rate is $1.50 and you pay 6¢ per mile, here’s what you might pay for insurance per month:

For certain low-mileage students, this option can save up to 72 percent annually. Be sure to calculate how many miles you drive during your daily life as a student, on average, before you choose this plan.

Note that Milewise is only available in select states:

• Arizona
• Delaware
• Florida
• Idaho
• Illinois
• Indiana
• Maryland
• Massachusetts
• New Jersey
• Ohio
• Oregon
• Pennsylvania
• Texas
• Virginia
• Washington
• Washington, D.C.
• West Virginia¹

Smart Student Discount

Many companies offer student discounts, but Allstate offers the most flexible savings options for college students. If you are under 25 and unmarried, you can qualify for Allstate’s Smart Student Discount if you meet any one of these three conditions:

• You have a GPA of at least 2.7 as a full-time student.
• You complete Allstate’s TeenSMART safe driving course.
• You attend school more than 100 miles away from where your parents house the car.

Because of its flexible nature, the Smart Student Discount can provide significant savings for many types of students. If you are a part-time student, you can still save by completing a safe driving program. If you live close to home, you can still save by getting good grades.

Such diverse options make Allstate’s student discount more compelling than other insurance providers’ offerings. Older or married students are disqualified from receiving this deal, though older, married people receive lower rates than teens in general.² Also, if you want to take advantage of the student-away-from-home discount, your car’s title must be in the name of your parent or guardian.

Save by Bundling Multiple Policies

Most college students moving away from home for the first time need more than just car insurance. They should also think seriously about buying renters insurance for their dorms or off-campus housing, which would protect their valuables in the event of a catastrophe or a house party gone wrong.

Allstate’s multiple policy discount can help you save up to 10 percent on auto insurance by bundling it with renters insurance. Be sure to indicate your need for renters insurance when requesting an online quote, since bundling will reflect the premiums you receive.

Students may also elect to drive for a rideshare service to earn extra cash, making rideshare insurance a crucial consideration. Note that Allstate offers rideshare insurance as both add-on coverage and as a separate insurance policy.³ Speak to an agent to decide which option is right for you.

As the nation’s largest auto insurance provider, State Farm is a great choice for students in a younger age bracket.

Steer Clear Safe Driver Program

State Farm offers a program called Steer Clear to help young adult drivers sharpen their skills and save on their premiums. To qualify for Steer Clear, you must meet these requirements:

• Be under the age of 25.
• Have a valid driver’s license.
• Have zero at-fault accidents or moving violations on your record in the past three years.
• Complete five modules in an app within six months of starting the program.
• Complete five hours of driving in at least 10 trips.⁴

Once you complete the program, State Farm automatically sends your certification to your insurance agent, who will then apply a discount to your coverage. This program helps younger students improve their driving and save up to 15 percent on car insurance.

Good Student Discount

State Farm offers a solid discount for high-achieving students, but it is slightly less flexible than Allstate’s version. This discount is available if you are a full-time student under age 25 and meet one of the following conditions:

• You are in the top 20 percent of your class.
• You have an average grade of B or higher.
• You have a GPA of 3.0 or higher.
• You made the dean’s list or honor roll in your preceding semester.

Not only is this option a bit more restrictive than Allstate’s, but the grade requirements are slightly higher. Still, it represents a solid route to savings for young students who get good grades in their full-time programs.

Student Away at School Discount

If your parents list you on their State Farm car insurance policy and you don’t need to use a car while at school, you may qualify for State Farm’s Student Away at School discount. In order to participate in your program, you must meet these criteria:

• You live at school, more than 100 miles away from home.
• You drive your car only while visiting home during breaks.
• You keep your car at home while at school.
• You are under age 25.

If you meet these qualifications, talk to your State Farm insurance agent to see how you can save while you are away at school.

Direct Auto may not be as much of a household name as Allstate or State Farm, but it’s an option you should consider if you live within its coverage area.

Good Student Discount

Direct Auto’s Good Student Discount provides up to 10 percent off your car insurance if you meet all of the following conditions:

• You are unmarried.
• You are a full-time student.
• You are an honor student, are on the dean’s list, have a B average or higher, or are in the top 20 percent of your class.
• You live in a state where Direct Auto offers the Good Student Discount — Alabama, Arkansas, Delaware, Florida, Georgia, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, or Washington.⁵

While it may be slightly less flexible than other companies’ student savings offerings, Direct Auto’s Good Student Discount is unique in that it is available for nontraditional adult students. If you are headed back to school for a career change or a master’s program, you may qualify for savings even if you are over the age of 25.

Multicar Discount

Did your parents buy you a car as a graduation gift? Do they pay for your auto insurance?

If you plan to stay on your parent’s insurance while at school, then Direct Auto’s impressive multicar discount can help you save up to 25 percent on premiums. Just make sure that each vehicle on the plan is registered in the same household and to the same policyholder. And parents, learn how to add your teen to your policy.

Flexible Payment Options

Direct Auto offers some of the most customizable payment options in the industry, which is helpful for college students strapped for cash or those with nontraditional income streams. The company lets you choose the day of each month on which you’d like to make your payment, helping you align it with payday.

Another way to reduce monthly costs is to elect to pay more upfront as a down payment, which could be a good option if you have the cash from a graduation gift or a paid summer internship. However, if you want to avoid a down payment, check out the best car insurance with no down payment.

Also, Direct Auto provides some of the most flexible ways to pay your premiums. You can auto-pay online with a credit or debit card, pay by e-check, or even pay with cash at a local Direct Auto or partner location. Such options can be life-savers for students who earn largely cash-based incomes.

USAA is a popular provider of student car insurance, but it is limited to military members and their families.

Good Student Discount

USAA’s Good Student Discount has similar requirements to those of other providers. To qualify, applicants must meet these conditions:

• You’re between the ages of 16 and 25.
• You’re enrolled full time at a college or university.
• You’re a high-achieving student with one of the following qualifications:
  • Top 20 percent of your class
  • B average or higher
  • GPA of 3.0 or higher
  • Honor roll or dean’s list

Note that this discount does not renew automatically — you will have to reapply each year to prove you are eligible. The discount is not available in Hawaii or North Carolina. But if you are a military student or from a military family, you should apply to see how much you can save thanks to good grades.

Family Discount for Your First Insurance Policy

USAA rewards loyalty. If your family has had a USAA insurance policy for at least three years, you can apply for a family discount on your first individual auto insurance policy. You can unlock savings of up to 10 percent if you are under the age of 25 and have a clean driving record. USAA’s family discount can represent a great value for students moving away from home who are off their families’ policies for the first time.

Get Rewarded With SafePilot

Most college students drive with their phones on them. If you carry your phone everywhere and drive safely, USAA will reward you with car insurance discounts based on your driving habits. Download the free USAA SafePilot app to assess how well you’re driving and how you can improve.

When your policy renews, USAA will assess up to a 30 percent discount based on your performance and reset your score so that you have a fresh start. It’ll even give you a 10 percent discount on your quote just for enrolling in the program.⁶ SafePilot offers great value for any student that wants to earn discounts for driving safely.

National General specializes in policies for higher-risk drivers. Since young students are often seen as high risk, National General can represent a solid value. But be aware that these policies often come with higher-than-average premiums.

Good Student Discount

Like all of our recommended student insurers, National General reduces rates for students that maintain high academic standards. The company offers a discount if you maintain at least a 3.0 GPA  the exact discount varies by state). Note that this discount is slightly less flexible than what other providers offer, and it may be difficult to qualify for if you attend a college that does not provide GPAs, like Reed College, Evergreen State, or the New College of Florida.

Coverage for Students With DUIs or Moving Violations

Many insurers regard drivers with DUI records or moving violations as unacceptable risks. National General, however, specializes in providing coverage for first-time offenders who have completed the company’s Safe Driving and Substance Abuse Therapy program. National General can also help drivers file an SR-22, a required certificate in many states that demonstrates you have the minimum level of auto insurance coverage. If you have blemishes on your driving record, National General may be your best option.

Guaranteed Satisfaction for Claims

National General offers a unique customer satisfaction guarantee for its claims service. The company promises to waive your deductible up to $250 if you are unsatisfied with its claims service. National General pays most claims within 48 hours of the initial filing. Note that this guarantee is not available in the state of Washington.