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Icon CheckLast updated: October 18, 2022

The Best Auto Insurance for Teens

Insure your teen without breaking the bank.

Best Overall
State Farm Logo

With multiple discounts available to young and new drivers, State Farm is a great choice for teen auto insurance. It is cheap and widely available — not to mention that it has solid customer satisfaction and financial ratings.

Best for Multi-Car Households
Direct Auto Logo

You’ll save up to 25 percent if you add an additional car for your new teen driver to an existing Direct Auto insurance policy, making it a great option if your teen will be driving their own car.1

Find the Best Insurance for Your Teen.

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The cost of auto insurance for teens is higher than for adults, and teens are one of the most expensive groups to insure overall. That’s because insurance companies consider teens high-risk due to their lack of driving experience. That said, some providers offer better deals for teens than others.

Our guide will walk you through finding the best auto insurance for a teen driver. Looking for an even more personalized recommendation? Call one of the Perfect Policy Connectors, who will shop the entire market and connect you with the best policy for your needs.

Comparison of the Best Auto Insurance for Teens in 2022

Feature #1. State Farm #2. Direct Auto #3. Allstate #4. USAA #5. Farmers
What it’s best for Overall Multi-car households Students Military families Shared cars
Discounts Accident-free, defensive driver course,

good driving habits, good student, multi-car/family, safe driving, student away from home, young driver

Accident-free, driver education, good driving habits, good student, multi-car/family Accident-free, driver training, good student, safe driving, student away from home Driver training, good driving history/habits, good student, multi-car/family, safe driving Accident-free, defensive driver course, good student, multi-car/family, safe driving, student away from home, young driver, shared family car
Customer satisfaction rating out of 1,000 (J.D. Power) 847 803 826 884 848
Year founded 1922 1991 1931 1922 1928
Number of customers 87,000,000 N/A 16,000,000 13,000,000 19,000,000
Link to read review State Farm review Direct Auto review Allstate review USAA review Coming Soon

Summary of the Best Auto Insurance for Teens of 2022

  1. 1.

    Best Overall: State Farm

  2. 2.

    Best for Multi-Car Households: Direct Auto

  3. 3.

    Best Auto Insurance for Teen Students: Allstate

  4. 4.

    Best Teen Auto Insurance for Military Families: USAA

  5. 5.

    Best Teen Auto Insurance for a Shared Car: Farmers

Detailed List of the Best Auto Insurance for Teens of 2022

1. Best Overall - State Farm

What We Like Most:

  • Local agents
  • Rideshare insurance available
  • Discounts for having multiple cars

Considering the high cost of auto insurance for teens, you’ll want to find the best deal. With a number of discounts for young drivers and a history of low rates, State Farm is a great option.

ProsWho It's Best For
  • pro
    Young drivers with clean driving histories and good habits
  • pro
    Students with good grades, including homeschoolers
  • pro
    College students away at school
  • pro
    Teen drivers who have completed driver education courses
ConsWho It's Not Best For
  • con
    Military families, because they can find lower rates elsewhere
  • con
    Drivers who need gap insurance, as State Farm does not offer this coverage unless you financed your vehicle with State Farm Bank

Savings for Good Drivers

State Farm offers multiple discounts for good driving habits, including a specially designed discount for teen drivers.

Safe driving program Maximum discount Eligibility requirements
Steer Clear 15%
  • Under 25
  • No at-fault accidents or moving violations in past 3 years
Drive Safe & Save driving behavior monitoring app 30% None

Additionally, when you’ve had a policy with State Farm for at least three years in a row without an accident, you can qualify for an accident-free discount of up to 25 percent.

Discounts for Students

Teen drivers with GPAs of 3.0 or higher can save up to 25 percent on auto insurance, a discount that can last until they turn 25. Homeschooled students may qualify as well, if they have taken certain national standardized tests within the past 12 months and ranked in the top 20 percent.

Regardless of their grades, college students who are away from home can also save. To qualify for a student away from home discount, the driver must be under the age of 25 and must only use the vehicle while at home during school vacations and holidays. If your teen takes their car to college, check out our roundup of the best auto insurance for college students.

Easy Claims Process

If you need to file a claim, State Farm makes the process easier with its mobile app. From start to finish, you can complete the claim in the app by entering details of the incident and uploading photos and documents from your phone. You can receive your payout by either direct deposit or mailed check.

2. Best for Multi-Car Households - Direct Auto
Direct Auto Logo

What We Like Most:

  • Low rates for high-risk drivers
  • Can pay in cash locally
  • Save money by bundling with life insurance

Founded in 1991, Direct Auto offers an impressive multi-car discount, as well as commercial policies for teens who use their cars for work. Students with B averages or higher can save up to 10 percent on car insurance, as can drivers under the age of 21 who complete a state-approved driver education course.

ProsWho It's Best For
  • pro
    Teens who drive separate vehicles from their parents
  • pro
    Families looking for flexible payment options
  • pro
    Teens with delivery jobs
  • pro
    Multigenerational families, as Direct Auto offers a discount of up to 5 percent for seniors
ConsWho It's Not Best For
  • con
    Families looking for a large insurance provider
  • con
    Drivers who want a company that’s been around for a while, as Direct Auto has only existed since 1991
  • con
    iPhone and iPad users who prioritize mobile app experience, as the Direct Auto app has only a three-star rating in the App Store2

Good for Teens With Their Own Cars

For teens who plan to buy a car (or who will receive one as a gift) when they start driving, Direct Auto offers a nice discount. When you simultaneously add a teen driver and a new car to an existing Direct Auto insurance policy, you may be eligible for a multi-car discount of up to 25 percent.

Commercial Options for Teens With Jobs

It’s common for teens to earn a little side cash, especially during the summer. However, the typical personal auto insurance policy doesn’t cover accidents that happen during work. If a teen driver is using the car to transport goods, like pizzas, groceries, baked goods, sandwiches, or flowers for a fee, they’ll need a commercial policy. Direct Auto offers competitive pricing for commercial policies, and teens may be eligible for their own commercial policies.

FYI

Teens who plan to earn money by delivering goods with their cars need to purchase commercial auto insurance policies.

Flexible Payment

Auto insurance is a significant monthly expense, especially considering the higher cost of purchasing a policy for a teen. Direct Auto gives customers flexibility around when and how they pay. You can choose the following aspects around payment:

  • The day of the month to make your payment depending on your own personal factors, like when you get paid
  • How often you’ll pay (i.e., in full or in several installments)
  • Whether or not to pay more upfront and lower your subsequent monthly costs, like by making a down payment
  • How to pay your bills, including the option to pay with cash at your local Direct Auto location or partner payment location, make one-time payments online with a credit or debit card, set up auto-payments online, or pay by e-check
3. Best Auto Insurance for Teen Students - Allstate

What We Like Most:

  • Low rates for teen drivers
  • A+ rating from AM Best means financial stability
  • Great customer service

With several paths to earning a student discount, Allstate is a good option for teen drivers regardless of their report cards. And the more drivers who sign up for Allstate’s Drivewise safe driving app, the greater the discount will be, making it a good option for families with multiple young safe drivers.

ProsWho It's Best For
  • pro
    Students with any GPA, as there are multiple ways to earn the student discount
  • pro
    Drivers who want options for roadside assistance
  • pro
    Customers looking for accident forgiveness
  • pro
    Families looking for good rates for teen drivers
ConsWho It's Not Best For
  • con
    Families with multiple cars, as there are no discounts
  • con
    Customers looking for a discount on driving a hybrid or electric vehicle

Multiple Paths to Student Discount

Allstate offers three routes to earning its student discount, meaning you may not need good grades to earn a lower rate. You qualify if you’re an unmarried, full-time high school or college student under 25 years old, and fulfill one of the following requirements:

  1. You have a GPA of 2.7 or higher, or at least a B-minus average.
  2. You complete the TeenSMART driver education program successfully.
  3. You attend school at least 100 miles away from where your car is garaged (and are younger than 21).

The TeenSMART driving program includes videos, simulations, and parent-teen activities that teach teens how to drive safely and avoid hazards on the road. Allstate customers receive a $50 discount on the program, at $69.95 per driver. Teens who qualify for the student discount can save around 20 percent on premiums.

Roadside Assistance

Mishaps on the road like a flat tire, running out of gas or battery, or locking your keys in the car are stressful for any driver, especially a new one. Allstate offers three types of roadside assistance, which provide teen drivers and their families peace of mind. Roadside assistance includes flat-bed tow trucks for electric cars, tire changes, lockouts, jump-starts, and fuel delivery, although the fuel itself is at a customer’s expense. You can access roadside assistance through Allstate’s mobile app or by phone.

Plan name Plan type Cost Allstate policy required? Number of 24/7 roadside assistance visits per year Trip interruption benefit (rentals, lodging, meals, etc.) Road hazard benefit Renewal cost
Roadside Advantage Membership $79 for the first year No 3 $1,500 $100 $99
Roadside Elite Membership $149 for the first year No 5 (includes RV coverage) $1,500 $250 $169
Pay-Per-Use One-time $119 for a 5-mile tow, $5 for each additional mile

$79 for fuel delivery, jump-start, and other services

$84 for tire change

No Unlimited, but requires payment for each None None N/A
Roadside Assistance Add-on Coverage Policy add-on About $25 per year per vehicle Yes Depends on the level of benefits you choose None None About $25, depending on your policy

In addition, Allstate’s Drivewise app offers a crash detection safety feature. If the app detects a collision involving a car moving 25 miles per hour or faster, you’ll receive a notification that helps you call 911, request roadside assistance, and start a claim.

Accident Forgiveness

Due to their inexperience, teens are at a higher risk of causing a car accident than adult drivers.

DID YOU KNOW?

According to the Insurance Institute for Highway Safety, teens are four times more likely than drivers over age 20 to crash for each mile driven.3

Allstate offers an accident forgiveness coverage add-on, which ensures premiums won’t increase even if a teen driver is at fault in an accident. And for every six months without an accident, Allstate customers receive a safe driving bonus of up to five percent on their auto insurance bill.

4. Best Teen Auto Insurance for Military Families - USAA

What We Like Most:

  • Lowest rates for military members, veterans, and their families
  • Rideshare insurance available
  • Usage-based insurance available for low-mileage drivers

The United Services Automobile Association (USAA) provides insurance, banking, and investment advice for members and veterans of the U.S. military, pre-commissioned officers, and their spouses and children. It’s one of the best auto insurance options for military members and their families, especially families with teen drivers.

ProsWho It's Best For
  • pro
    Active-duty military members, veterans, and their families
  • pro
    Children of USAA policyholders, who may qualify for a discount on their own policies
  • pro
    Drivers looking for low premiums
  • pro
    People looking for a company with a strong history of customer satisfaction
ConsWho It's Not Best For
  • con
    Individuals not affiliated with the U.S. military, as they are not eligible to purchase insurance from USAA

Lower-Than-Average Prices

USAA offers some of the lowest auto insurance prices consistently, including for teen drivers. Teens and their families can take advantage of a number of discounts.

  • Good student: Drivers under 25 who maintain a B average or higher, a minimum 3.0 GPA, rank in the upper 20 percent of their class, or who made the honor roll or dean’s list qualify for this discount.
  • Driver training: Teens who complete a basic driver education course save on premiums.
  • Safe driving: Young drivers who maintain a good driving record for at least five years receive discounts.
  • Multi-vehicle: If you add another vehicle to your policy, you can save on premiums.

Family Discount for Young Driver’s First Policy

Most teen drivers start off on their family’s policy, which is usually cheaper than buying a separate policy. Eventually, the young driver might want to transition off a family’s policy — maybe because they’ve moved, started a new job, or experienced another life change. USAA makes things easier with its family discount.

When children of USAA policyholders purchase their own auto policies, they may qualify for a 10 percent discount. To be eligible, the driver needs to have been on their parents’ or guardians’ policy for at least three years, be under 25 years old, and have a clean driving record.

Exceptional Customer Satisfaction

USAA received a customer satisfaction rating of 884 out of 1,000 from J.D. Power, significantly higher than the overall satisfaction rating of 835 across other auto insurance providers.4 AM Best, which rates companies for financial strength, awarded USAA a “superior” rating — meaning you’ll never have to worry about its ability to pay for your claim.5

The bottom line? If you buy a USAA auto insurance policy for a teen driver, you can feel confident that it’ll pay for claims without issue, and your customer service experience will be stellar.

5. Best Teen Auto Insurance for a Shared Car - Farmers

What We Like Most:

  • Good drivers can save money with the Signal app
  • Transportation costs covered when your vehicle is being repaired
  • Roadside assistance available

In business since 1928, Farmers has a history of providing quality auto insurance. One of the things that set Farmers apart is its commitment to customer satisfaction. On the National Association of Insurance Commissioners complaint index, Farmers scored a 0.54 — meaning it receives about half as many customer complaints as the average auto insurance company of its size.6 Farmers also offers an extensive number of discounts, including several that benefit teens and their families in particular.

ProsWho It's Best For
  • pro
    Families who share one or multiple cars
  • pro
    Young adults looking to transition off their parents’ policies
  • pro
    Customers looking for many discount options
  • pro
    People looking for a company with an impressive customer satisfaction record
ConsWho It's Not Best For
  • con
    People in who live in Alaska, Delaware, Hawaii, Maine, New Hampshire, Rhode Island, Vermont, West Virginia, or Washington, D.C., where Farmers is not available
  • con
    People with poor credit
  • con
    Drivers with SR-22s

Good Option for Shared Family Cars

Many providers offer multi-car discounts for adding a vehicle to your policy, but Farmers is unique in its shared family car discount. Considering the expense of buying car insurance for a teen, it makes sense that families would want to save on the expense of buying a separate vehicle for their teen. For families that share one or more cars, Farmers offers a discount.

For a household to qualify, there must be at least one unmarried driver 20 years old or under, and more active drivers than there are vehicles. Vehicles in storage don’t count toward the total number of household vehicles. Farmers applies the shared family car discount to all vehicles on the policy. This discount is available in all states except California.

Loyalty Discount for a Young Adult’s First Policy

Like USAA, Farmers offers a discount to young drivers who are transitioning off their parents’ auto insurance policies and buying their own policies for the first time. Unlike USAA, Farmers is available to anyone, regardless of military affiliation. To qualify for the “on your own” discount, you must be under 29 years old and must have been an active driver on the Farmers policy in your prior household for at least a year.

Many Discount Options

Farmers offers an impressive 23 discounts. Many of these discounts offer special savings for teen drivers and their families.

  • Signal: Allow Farmers to track your driving habits (phone use, braking, speed), and earn higher discounts when a driver aged 15 to 24 in your household enrolls, too.
  • Distant student: Save when a student on the policy leaves for school at least 100 miles away and only uses the vehicle on breaks.
  • Youthful driver: Earn a discount when you add a child or grandchild under age 25 to a policy that’s been in force for at least a year.
  • Good student: Pay less for students who earn GPAs of 3.0 or higher, make the dean’s list or honor roll, rank in the top 20 percent of the class, or score in the top 20 percent on standardized testing.

Methodology

Our method for determining the best auto insurance companies is based on three main factors.

  • Company data: We comb the auto insurance market for information on each company’s coverages, premiums, and available discounts. We also compile third-party data from sources like the Better Business Bureau, Moody’s, AM Best, the National Association of Insurance Commissioners, S&P Global Ratings, and J.D. Power. These institutions rate auto insurance providers for customer satisfaction and financial strength. When we analyze the data, we weigh each of these factors and prioritize companies that offer low premiums and discounts for teens, young drivers, and their families. Our final rankings reflect the companies that offer the best combination of low costs, quality coverage, financial solidity, and strong customer satisfaction.
  • Proprietary information: Over the past two decades, AutoInsurance.com has helped customers find affordable auto insurance policies that are the best fit for them. In that time, we’ve collected millions of data points on these transactions. We examine the data to understand the demographic qualities that predict the greatest success with specific companies. That way, we can match customers with the provider that offers the type of coverage they need at the price they can afford. We crunched the numbers and determined the providers that offer the best and most affordable coverage for teens and their families.
  • Institutional experience: We have 20 years of experience in the auto insurance industry, which translates into a wealth of institutional knowledge. We’re deeply familiar with each auto insurance provider and its specific strengths and weaknesses. Our team of experts includes Paul Ford, a professional with nearly 30 years of experience in the industry. Our customers benefit from Paul’s substantial knowledge about auto insurance, which we leverage to match individuals with their Perfect Policies. Currently, Paul is president of insurance at Centerfield (AutoInsurance.com’s parent company) and holds past experience at Canadian Access, InsLogic, Capital One Insurance Services, NetQuote, Bankrate, and Datalot.

FAQs

What is the average cost of auto insurance for teens?

The average annual cost of auto insurance for drivers age 16 to 19 is $3,751, or $313 per month. The cost of car insurance for teens tends to decrease as they get older.

Age Average annual cost of auto insurance in the U.S.
16 $4,368
17 $3,925
18 $3,953
19 $2,758
20 $2,931
21 $1,910
22 $1,670
23 $1,551
24 $1,456

What is the best car insurance for young drivers in Florida?

One of the best car insurance options for young drivers in Florida is GEICO. The average annual rate from GEICO for drivers in Florida ages 16 to 19 is $2,791, which is below the national average cost of teen insurance.

Age Annual rate from GEICO in Florida
16 $2,965
17 $2,965
18 $2,776
19 $2,457

Another solid option is State Farm, which also offers cheap rates for young drivers in Florida.

How do you save money on car insurance for teens?

  1. Add them to an existing policy instead of buying them their own policy.
  2. If it’s not possible to add a teen to an existing policy, find the best deal on individual policies by getting a car insurance quote from different auto insurance providers. By comparing quotes from multiple companies, you can find the lowest car insurance rate at one specific company. Be sure to input the same information with each car insurance company to get accurate average rates, from your teenager’s age to your credit score.
  3. Make sure your agent is applying all possible discounts, such as good student discounts and discounts for completing driver education. Applying discounts will lower your auto insurance rates, so consider the available discounts when comparing car insurance.

What are the cheapest cars for teen auto insurance?

The cheapest cars to insure for teen drivers are smaller vehicles, which cause less damage in an accident, and vehicles with modern safety features that keep passengers safe and lower potential medical bills. The Volkswagen Golf GTI and Subaru Outback are two of the cheaper vehicles to insure for teens, as they combine the safety features of a larger car with the benefits of a compact vehicle. Flashy sports cars and luxury vehicles are the most expensive to insure for anyone, but for teen drivers in particular.

Citations

  1. Insuring a Teen Driver? Get Answers to 7 Common Questions. Direct Auto Insurance. (2016).
    https://blog.directauto.com/auto-insurance/insuring-teen-driver-common-faqs/

  2. Direct Auto on the App Store. Apple App Store. (2022).
    https://apps.apple.com/us/app/direct-auto/id1571501814

  3. Teenagers. Insurance Institute for Highway Safety. (2022).
    https://www.iihs.org/topics/teenagers

  4. 2021 U.S. Auto Insurance Study. J.D Power. (2021).
    https://www.jdpower.com/business/press-releases/2021-us-auto-insurance-study

  5. AM Best Affirms Credit Ratings of United Services Automobile Association, Its Subsidiaries and USAA Capital Corporation. AM Best. (2020).
    https://news.ambest.com/presscontent.aspx?refnum=29108&altsrc=9

  6. Results By Complaint Index. National Association of Insurance Commissioners. (2021).
    https://www.naic.org/cis_refined_results.htm?TABLEAU=CIS_COMPLAINTS&COCODE=40169&:refresh