Best Auto Insurance for New Drivers

Liberty Mutual is our top auto insurance pick for new drivers. It combines great coverage with a number of opportunities to save. And with an A rating from AM Best for financial strength, you can count on its ability to pay for a claim.

Discounts to Lower Premiums

With any insurer, some discounts only apply if you have a driving history or already have insurance. For example, certain discounts require that you’ve been accident-free for a certain amount of time, or that you buy a policy before your existing one expires. New drivers can’t apply these discounts, but there are a number of discounts they do qualify for:

• Using RightTrack, an app that tracks your driving behavior (nighttime driving, braking, acceleration, and total miles driven) and awards you a discount up to 30 percent for good driving
• Owning a home.
• Being a military member, whether you’re active, retired, or reserved
• Being a student with a GPA of B or higher or a student away at school who only uses the car on breaks at home (Explore other good student discounts for cheap car insurance, as Liberty Mutual isn’t the only car insurance company to offer this benefit.)
• Bundling multiple policies
• Enrolling in automatic payments or paying for your policy in one or two bulk payments
• Completing your insurance purchase online
• Enrolling in paperless billing

Deductible Fund

Liberty Mutual is known for its range of add-on coverage options, some of which you won’t find with every insurer. This includes Liberty Mutual’s deductible fund add-on. The purpose of this optional coverage is to reduce the amount you pay toward your deductible before your coverage kicks in after an incident. Here’s how it works:

1. You add $30 to your yearly premium ($2.50 per month), which goes to your deductible fund.
2. Every year, Liberty Mutual lowers your deductible by $100.
3. In the event of an accident, you pay less for your deductible.

For example, let’s say your initial deductible is $500. You’ve been enrolled in the deductible fund for two years, which reduces your deductible by $200. Then, you get into an accident. You’ll pay $300 for your deductible, saving you $140 overall ($200 minus the $30 you paid toward the deductible fund each year).

This coverage is a good option for new drivers, who might have taken a higher deductible to lower insurance premiums.

Benefits for Teachers

If you just got your driver’s license because you’re a teacher who needs to commute to school, Liberty Mutual is a good choice. It offers several benefits to teachers at no extra cost:

• No deductible if your car is vandalized on school property or at a school event, or if your vehicle sustains damage in a collision while you’re driving it for school-related purposes (except for drivers in Pennsylvania, where a $100 deductible applies)
• Coverage of up to $2,500 per incident if school-owned property or your teaching materials are damaged or stolen while in your vehicle.
• Special discounts

Recently acquired by Allstate, National General specializes in selling insurance to high-risk drivers that standard insurers might refuse. Its rental and emergency assistance offerings make it stand out, and it has a special program for first-time DUI offenders.

Rental and Emergency Assistance

The prospect of dealing with an accident or roadside emergency is stressful for any driver, especially if you’re new to the road.

Many auto insurers offer some form of rental reimbursement coverage, which pays for a rental car after an incident while your car is in the shop under a covered claim. National General is unique in offering valet service as part of its rental reimbursement coverage.

After a claim, National General will send someone to pick up your damaged vehicle and bring you a rental car. Once your car is repaired, someone will deliver it to you and return the rental vehicle. It’s one less hassle to deal with after an accident, which can be helpful if you’re a new driver dealing with a claim for the first time.

Additionally, National General gives customers an emergency expense allowance. For covered claims, National General will pay you up to $500 for travel expenses, lodging, and food. That way, you can focus on returning home safely and repairing your car.

Special Policies for First-Time DUI Offenders

Impaired driving poses an enormous risk to anyone in the car and others on the road. After a DUI offense, many standard insurers will drop your coverage or increase your premiums substantially.

If you are a driver returning to the road after your first DUI, National General is a good option. After your first DUI offense, National General gives you a chance to complete a safe driving and substance abuse therapy program. Drivers who complete the program can get rates that are more affordable compared to the competition.

Though each individual’s insurance premiums are unique, National General claims it can save first-time DUI offenders up to $442 a year. (Note: National General does not offer this opportunity for second and subsequent DUI offenses).

Additionally, if you need to file an SR-22, National General will handle the paperwork for you.

Good Deals for RV Owners

National General offers a 20 percent discount for bundling your auto and RV insurance, making it a good choice for RV owners. And if you get into an accident involving both your regular car and your RV, National General will waive one of your deductibles.

With multiple ways to earn savings for clean driving records, Nationwide is a solid choice for people without driving histories who want to save money. The company offers coverage options that new drivers in particular may benefit from. And according to the National Association of Insurance Commissioners, Nationwide receives slightly fewer complaints than expected for a company of its size.²

Savings for Good Drivers

Even if you don’t have a driving history, you can prove that you’re a safe driver with your actions. When you allow Nationwide to track your driving habits with its SmartRide app, you can earn a discount of up to 40 percent. That’s the largest discount for using a tracking app among all of our top auto insurance picks for new drivers. The app uses four driving factors to determine your discount:

1. Acceleration and braking
2. Miles driven
3. Nighttime driving
4. Idle time

SmartRide is free to use and will never increase your premiums.

If you feel confident in your driving, consider purchasing Nationwide’s optional vanishing deductible coverage. Here’s how it works:

1. For every year you drive safely, Nationwide will reduce your deductible by $100, up to $500 total.
2. Nationwide applies the first $100 after a 30-day waiting period from when you purchase the coverage.
3. If you get into an accident, Nationwide will reset the credit to $100.

Accident Forgiveness

Conversely, if you’re a new driver, maybe you still feel a little nervous on the road. That’s normal, especially considering that accidents happen even to the most experienced drivers. If you’re involved in an accident, the only thing you should have to worry about is your safety, not your insurance premiums increasing.

Nationwide offers an accident forgiveness add-on coverage, which will help you avoid an increase in your premiums after your first at-fault accident. The add-on applies to anyone on your policy, but you can only use it once per policy.

Regular Reviews of Insurance Needs

Navigating your insurance policy can be complicated, especially if you’re a new driver. After you sign up for a policy, Nationwide gives you the opportunity to talk with an insurance professional to review your insurance and answer questions at regular intervals. This assessment accomplishes the following:

• Understanding your policy and benefits
• Ensuring you have the right amount of coverage
• Applying any available discounts
• Determining whether life events will warrant a change to your insurance policy

You can use this benefit every year, or whenever you experience a major life event. According to the Insurance Information Institute, the following life events may change your auto insurance needs:

• Marriage or divorce
• Buying a home or moving
• Getting a new car
• Your teenager getting their driver’s license
• Joining a carpool
• Retirement

Travelers has been in business for more than 165 years, making it one of the longest-standing insurers in the industry. Plus, it holds an AM Best rating of A++ for financial strength, the strongest of our top picks.⁴

Non-Owners Insurance

If you’re a new driver who doesn’t own a vehicle, it may still be wise to purchase auto insurance. Some states even require it. This type of policy is known as non-owner car insurance, and it’s good to consider if any of the following is true:

• You drive rental or Zipcar vehicles.
• You borrow vehicles from friends or family members.
• You take care of someone you don’t live with and drive their car.
• You have a company car that you also drive for personal use.
• You need an SR-22.

Travelers offers non-owner insurance. Most non-owner insurance is liability only, meaning that it only covers the other party’s bodily injuries and property damage in an accident. This protects you from financial responsibility for the other party’s damages, but it doesn’t pay for you or your passengers’ damages. Travelers’ non-owner insurance can include additional coverages to give you extra protection.

Coverage and Discounts for New Cars

For newly minted drivers who have purchased new cars, Travelers is a good option. If you purchase new car replacement coverage and total a new car within the first five years of owning it, Travelers will replace it with a new vehicle of the same make and model. It’s a strong offering considering most competitors with similar coverage options will only replace your vehicle for the first one or two years.

Additionally, Travelers offers a new car discount for vehicles that are less than three years old, which helps you save on premiums.

Roadside Assistance

Roadside assistance is additional coverage you can purchase for times when you run into unexpected car trouble, like a lockout or flat tire. This coverage can give you peace of mind, especially if you’re a new driver.

Travelers offers two roadside assistance options, depending on your needs:

If you’re a young driver or parent of a young driver, Farmers has a number of discounts that can help you save on premiums. In addition, Farmers’ has rideshare insurance for new drivers who want to work for services like Lyft or Uber.

Benefits for Young Drivers

The cost of insuring teen drivers is higher than for any other age group. That’s because young drivers tend to get into more car accidents than older drivers.

Farmers offers young new drivers and their families a number of ways to save on insurance premiums:

• Youthful driver: You get a discount when you add a child or grandchild 25 years old or under to a policy that you’ve had for at least a year. Learn how to add a teen to your policy.
• Shared family car: If your household has a driver under age 21 and more active drivers than the total number of vehicles, all vehicles on the policy get a discount.
• On your own: This discount is for young drivers who are transitioning off their family’s insurance. To qualify, you must be 28 years old or younger and active on your family’s policy for at least one year.
• Signal: Anyone can get a discount by tracking their driving habits with the Signal app. You get an extra discount if a driver in your household under age 25 enrolls.
• Student: Like many insurers, Farmers offers a discount for students with good grades, as well as college students who live and study at least 100 miles away from home.

Rideshare Coverage

If you got your license in order to drive for a service like Lyft or Uber, it’s a good idea to purchase rideshare coverage. While rideshare services must offer some protection for drivers, there is typically a gap in coverage when you’ve turned the app on and are waiting to match with a rider. During this time, your personal policy doesn’t protect you because you’re working, and the service’s coverage doesn’t protect you because you haven’t yet matched with a rider.

Farmers’ rideshare coverage extends the protections of your personal auto policy to the periods that the rideshare company doesn’t cover. That way, there’s never a concern about lacking coverage. You can add this coverage to an existing policy, or buy it with a new policy.

Loss of Use Coverage

Like most insurers, Farmers offers optional rental reimbursement coverage, which covers the cost of a rental while your car is in the shop after an accident. However, Farmers is unique in that it offers a separate loss of use coverage as well.

With this coverage, if your car needs repair due to damage from a covered incident, you’ll get a flat sum of money to use on alternate transportation. This includes public transit, a rental car, rideshares, and taxis. It’s a great option for new drivers who are more comfortable using a mix of transportation options rather than relying solely on a rental car.