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Insure your teen without breaking the bank.
Full Coverage Averages
• Annual Premium: $1,841
• Monthly Premium: $153
Pros + Cons
✓ Flat rate for adding a teen driver
✓ Accident forgiveness
X Available in only 26 states
Full Coverage Averages
• Annual Premium: $3,795
• Monthly Premium: $316
Read our State Farm review.
✓ Safe-driving discount specifically for teens
✓ Easy claims process
X No accident forgiveness
Full Coverage Averages
• Annual Premium: $1,942
• Monthly Premium: $162
Read our Erie review.
✓ Accident forgiveness
✓ Wide set of discounts
X Only available in 12 states
Find the Best Insurance for Your Teen.
Let our Perfect Policy Connectors shop the market for you!
(855) 953-0884Request a CallbackInsurance companies consider teenagers high-risk drivers due to their lack of driving experience, making them one of the most expensive groups to insure. It’s important to shop around, as some providers offer better deals for teens than others.
Below, our guide will walk you through finding the best auto insurance for a teen driver.
When comparing auto insurance policies for teens, the following factors are particularly important to consider:
Best Auto Insurance for Teens on a Family Policy: Auto-Owners
Best Auto Insurance for Teens on Their Own Policy: State Farm
Best Auto Insurance for Teens for Accident Forgiveness: Erie
Best Auto Insurance for Teens With Low Grades: Allstate
Best Teen Auto Insurance for Military Families: USAA
Company | Average annual cost for teens on a family policy | Average annual cost for teens on their own policy | Grade requirement for good student discount | Young driver discounts | Accident forgiveness |
---|---|---|---|---|---|
Auto-Owners Insurance | $1,841 | $4,381 | 3.0 GPA / B average | Good student, student away at school, GPS monitoring | Available after 3 years of no at-fault crashes or major violations |
State Farm | $2,623 | $3,795 | 3.0 GPA / B average | Good student, Steer Clear (State Farm safety training program), student away at school, driver education | Not offered |
Erie | $1,942 | $4,175 | Not offered | Live at home, legacy, driver education, student away at school | Available after being an Erie customer for 3 years (earlier in some states) or with Rate Lock |
Allstate | $3,809 | $3,962 | 2.7 GPA / B- average | Good student, TeenSMART (Allstate safety training program), student away at school | Available with no waiting period |
USAA | $1,941 | $3,597 | 3.0 GPA / B average | Good student, driver education, legacy | Automatically added, but only after 5 years accident-free |
Adding a young driver to an existing policy is one of the best ways to lower insurance costs for teens. Auto-Owners Insurance is often the cheapest option for parents who want to add a teen to the family policy because the company charges a flat rate for young drivers 19 and under.
In addition to low baseline rates, Auto-Owners helps families with teen drivers save with the following discounts specifically for young drivers:
Due to their inexperience behind the wheel, teens are more likely to get into accidents than nearly any other group. At-fault accidents raise premiums, usually by around 50 percent.
Auto-Owners Insurance offers Accident Forgiveness as an add-on. When you purchase the benefit, Auto-Owners won’t raise your premium if your teen (or someone else on the policy) causes an accident. Drivers must have no at-fault claims or major violations for three years to qualify. It’s a good option for families with a 19-year-old driver with a clean driving record.
Of course, accidents happen — even to the safest of teen drivers. Cars involved in accidents may not be worth as much as they were prior to the crash, even after being fully repaired. Auto-Owners offers Diminished Value Coverage, which covers the difference in a vehicle’s value after an accident. It’s a good option for families who upgrade their vehicles every few years.
Finally, Auto-Owners offers better rates for drivers with existing at-fault accidents on their record than many other providers. On average, the provider’s rates go up approximately 14 percent after an accident, making it a good option for teens with an accident on their record.
When a teen owns a vehicle that is solely in their name, they often require their own auto insurance policy. Teens on individual policies face higher costs compared to family policies. State Farm offers competitive rates for independent teen policies.
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% |
|
Drive Safe & Save Driving Behavior Monitoring App | 30% | None |
Additionally, in many states, State Farm offers a discount to drivers under age 21 who complete an approved driver education class.
Teen drivers with a GPA 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, teens who are attending college away from home can also save. To qualify for a student-away-from-home discount, the driver must:
With an average annual premium of $1,942 for teen drivers on a family policy, Erie has some of the most competitive rates for teen drivers. Customers also report high satisfaction with the company’s claims process and overall customer service. According to a recent J.D. Power study, Erie is the highest-ranked insurer in the Mid-Atlantic and North Central regions, and the second-highest-ranked in the Southeast.1
None of Erie’s young driver discounts is based on school performance, making it a good option for teens with lower grades. Erie’s young driver discounts help keep premiums low for teen drivers.
Teen driver discount | Who qualifies | Location restrictions |
---|---|---|
Youthful driver | Unmarried drivers under 21 who live with their parents or guardians | None |
Youthful driver longevity | Unmarried drivers who spent at least two years on another Erie policy, usually a parent or guardian’s | Not available in North Carolina |
Driver training | Drivers under 21 who complete a driver education course | Not available in Kentucky or North Carolina |
College student | Young drivers who live at school and don’t take a car | Not available in Kentucky or North Carolina |
Erie offers accident forgiveness to drivers who have been Erie customers for three years or more. In some states, such as North Carolina, you can add accident forgiveness to your policy without waiting three years.
In addition, Erie offers a unique Rate Lock feature. If you add this endorsement to your policy, Erie won’t raise your rates unless you add or remove a vehicle or driver from the policy or change your primary residence. In other words, with Rate Lock, at-fault accidents and violations like speeding tickets won’t raise rates for teen drivers or their families. Other factors, like inflation, won’t raise your premium either.
A few considerations to note:
For teen drivers with a speeding ticket on their record, Erie is a good option. On average, premiums increase by about 25 percent after a ticket, but Erie’s go up only 13 percent.
With several paths to earning a student discount, Allstate is a good option for teen drivers regardless of their report card. 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 drivers.
Allstate offers three routes to earning its student discount, meaning teens may not need good grades to earn a lower rate. Drivers qualify if they are unmarried, a full-time high school or college student under 25 years old, and fulfill just one of the following requirements:
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, resulting in a final cost of $69.95 per driver. Teens who qualify for the student discount can save around 20 percent on their premium.
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. Unlike other providers, Allstate doesn’t require a waiting period before you can add accident forgiveness to your policy.
Additionally, for every six months without an accident, Allstate customers receive a safe driving bonus of up to 5 percent on their auto insurance bill.
The U.S. Department of Transportation reports that teens drive an average of about 7,600 miles per year. That’s roughly half as many miles as the average American adult drives each year.2
For teens who drive less than 8,000 miles per year, a pay-per-mile insurance plan is a good option to explore. Allstate is one of the few major insurers to offer such a plan, called Milewise.
With Allstate’s Milewise plan, drivers pay a daily rate for insurance plus a per-mile rate. For example, let’s say you drive 10 miles per day on average:
Daily rate | $1.50 |
---|---|
Per-mile rate | $.08 x 10 miles = $.80 |
Total cost per day | $2.30 |
Total cost per month | About $70 |
Allstate uses a device installed in your vehicle to monitor your mileage, allowing you to keep track of your mileage and expenses through the Allstate app. If your family has multiple vehicles under the same policy, not all of them need to be enrolled in Milewise. You can individually decide whether each vehicle is classified as per mile or under a traditional unlimited mileage policy.
Milewise is available in Arizona, Delaware, Florida, Idaho, Illinois, Indiana, Maryland, Massachusetts, Minnesota, Missouri, New Jersey, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Virginia, Washington, West Virginia, Wisconsin, and Washington D.C.
For teens and families with higher mileage, Allstate’s Drivewise option may make more sense. Drivewise is an optional policy add-on, which measures behaviors like speeding, hard braking, and nighttime driving, and offers discounts for safe driving.
USAA is one of the best auto insurance options for military members and their families, especially families with teen drivers. It offers some of the cheapest rates for teens, whether they are insured on a family policy or their own policy.
USAA offers some of the lowest rates overall for teen drivers from military families, especially for older teens. Teens and their families can find additional savings with the following young driver-specific discounts:
Families should note that USAA’s good student discount is not available in North Carolina or Hawaii.
Most teen drivers start off on their family’s policy, which is 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.
When children of USAA policyholders purchase their own auto policy, they can 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.
The average annual cost of auto insurance for drivers aged 16 to 19 is $379 per month, or $4,548 annually. The cost of car insurance for teens tends to decrease as they get older.
Age< | Average monthly cost of auto insurance | Average annual cost of auto insurance |
---|---|---|
16 | $459 | $5,511 |
17 | $396 | $4,756 |
18 | $392 | $4,708 |
19 | $268 | $3,217 |
Adding a teen to your car insurance policy will be cheaper than buying them their own policy, sometimes by up to 60 percent. They’ll also qualify for discounts they wouldn’t get on their own, like if you bundle home and auto insurance. However, keep in mind that adding a teen to your policy may result in losing discounts for safe driving and being claims-free if the teen gets into an accident.
For a 17-year-old on a family car insurance policy, Auto-Owners Insurance ($1,841), Erie ($2,041), and USAA ($2,221) have the cheapest annual rates.
If a 17-year-old needs to purchase their own car insurance policy, USAA ($3,640), State Farm ($3,890), and Allstate ($4,962) offer some of the most affordable annual rates.
You can save money on car insurance for teens by:
Our method for determining the best auto insurance companies is based on three main factors.
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 cost, quality coverage, financial solidity, and high customer satisfaction.
Auto Insurance Customer Satisfaction Plummets as Rates Continue to Surge, J.D. Power Finds. J.D. Power. (2023, Jun 13).
https://www.jdpower.com/business/press-releases/2023-us-auto-insurance-study
Average Annual Miles per Driver by Age Group. U.S. Department of Transportation, Federal Highway Administration. (2022, May 31).
https://www.fhwa.dot.gov/ohim/onh00/bar8.htm