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Being a teenager can be expensive. Clothes, food, beauty products and school functions can all add up. Another big expense is car insurance.
Driver’s insurance is a necessary requirement if you plan to drive in the United States. And drivers under 25 pay some of the highest rates for car insurance, which is why it’s so important to find the best coverage at the lowest possible price. Some companies may offer low rates, but not all will feature the multifaceted coverage that teen drivers need with the discounts to make it all affordable. We've rounded up the best car insurance for teens to help you find the right policy.
Best Car Insurance for Teens of 2023
- Best Overall: State Farm
- Best for Student Discounts: Allstate
- Best Accident Forgiveness Policy: Amica
- Best for Military Families: USAA
- Best on a Budget: Erie
Best Overall : State Farm
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State Farm
- Average Price for a 17-Year-Old: $3,055 per year
- Purchasing Options: Online, phone, local agent
- Available Discounts: 13
With its signature Steer Clear program, State Farm can provide the best affordable, multifaceted coverage for young drivers.
Multiple discounts
Extensive network of agents
Rideshare insurance available
Mediocre claims satisfaction
Can be pricier than other companies
May have to purchase through an agent
State Farm provides nearly nationwide coverage, which includes most states and D.C. Unfortunately, residents of Massachusetts and Rhode Island aren’t eligible for coverage.
Customers have a variety of options for car insurance:
- Collision coverage
- Comprehensive coverage
- Liability coverage
- Car rental and travel expenses coverage
- Uninsured motor vehicle coverage
- Medical payments coverage
- Emergency roadside assistance
- Rideshare driver coverage
- Roadside assistance
Teens and young drivers can benefit by enrolling in the Steer Clear program, which offers a discount if you’re under 25 and don’t have any moving violations or at-fault accidents on your record. The Drive Safe & Save program allows you to save up to 30% on your premiums for being a safe driver.
State Farm insures other types of vehicles in addition to car insurance, including motorcycles, ATVs, boats, and RVs. You can go online for a quick car insurance quote to get started, or work with one of the 19,000 nationwide agents available to help. You may have to speak with an agent to best customize your coverage if you’re a parent adding a teen to your insurance policy.
State Farm’s reviews are quite good across the board. The insurer receives impressive ratings from AM Best for financial strength and from J.D. Power for customer satisfaction, but the NAIC reports about two times the average number of complaints.
Read our full State Farm auto insurance review.
Best for Student Discounts : Allstate
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Allstate
- Average Price for a 17-Year-Old: $4,716 per year
- Purchasing Options: Online, phone, local agent
- Available Discounts: 14
It’s easy for teens and young adults to save with Allstate's exclusive Drivewise program and other discounts.
Exclusive coverage options
Healthy number of discounts
Extended roadside support
Poor customer service
Six-month policy terms
Additional cost for roadside assistance
Allstate has been around since 1931 and it holds its headquarters in Illinois. It offers insurance in all 50 states and D.C., providing customers with excellent accessibility.
Allstate provides quite a few types of car insurance:
- Collision
- Comprehensive
- Liability
- Medical payments
- Uninsured and underinsured motorist
- Personal injury protection (PIP)
- Custom equipment
- Personal umbrella
- Rental reimbursement
- Classic car insurance
- Mexico tourist car insurance
Roadside assistance is also available with three different plans. One is designed for the occasional driver and another for drivers who spend a lot of time on the road. The last is a pay per use system.
Policies are sold in six-month terms, a change from most other insurers, but discounts are plentiful with 14 in all. Allstate's signature Drivewise program can save up to 40% on your policy when you show safe driving through a telematics-based system. Teens and young drivers can save money when they purchase a new car or earn good grades in school in addition to the standard car insurance discounts like anti-theft and anti-lock security savings.
But Allstate does not necessarily excel in customer service. It's earned below average scores by J.D. Power. But AM Best awards Allstate an A+ (Superior) score, which signals strong financial stability and reliability.
Read our full Allstate auto insurance review.
Best Accident Forgiveness Policy : Amica
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Amica Mutual
- Average Price for a 17-Year-Old: $6,156 per year
- Purchasing Options: Online, phone, live chat
- Available Discounts: 18
Amica doesn’t skimp on the savings, offering a number of discounts that include a generous accident forgiveness policy for your teen or young driver.
Accident forgiveness for newer drivers
Top customer satisfaction scores
Generous discount programs
Restricted availability for discounts
Limited local agent network
No rideshare insurance
Accident forgiveness is included in Amica’s Platinum Choice Auto package. It's a coveted perk that provides some leeway for new and training drivers. The package combines thoughtful extras like deductible-free glass repair and replacement, new car replacement, credit monitoring, and rental car reimbursement without any daily limits. This is an easy way for teens and young drivers who are looking for the full package to combine multiple services into one convenient bundle while still benefiting from an accident forgiveness program.
There are 18 total discounts you can apply to your policy to help you cut the cost of car insurance. They include loyalty, safe driver, and bundling discounts for multiple vehicles or multiple insurance products, like renters and auto insurance.
There are many types of car insurance coverage available:
- Collision
- Comprehensive
- Property damage liability
- Bodily injury liability
- Medical payments coverage
- Personal injury protection
- Uninsured and underinsured motorist protection
- Roadside assistance
- Glass coverage
- Rental reimbursement
- Gap coverage
Earning the top spot in J.D. Power’s 2021 New England rankings, Amica delivers excellent customer support despite a limited network of local agents found in just 12 states and D.C. Additional features like live chat support and online purchasing make all the difference for its tech-savvy users, adding a level of convenience that's not always seen among insurers.
Read our full Amica car insurance review.
Best for Military Families : USAA
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USAA
- Average Price for a 17-Year-Old: $2,662 per year
- Purchasing Options: Online, phone, agent
- Available Discounts: 12
As a military-only insurer, USAA offers teens and young drivers several ways to save on their auto insurance while also providing some of the best customer service in the industry.
Top-rated customer service
Banking and financial services available
Additional military resources
Military community only
Must maintain USAA membership
No local agent network
United States Automobile Association (USAA) was founded in 1922. It maintains its headquarters in San Antonio, Texas, although it services all 50 states. You must become a member in order to purchase auto insurance or any other product from USAA. This means you must be either active-duty military, a veteran, or an eligible family member.
Teens and young drivers have a choice of several types of auto insurance with USAA:
- Comprehensive
- Collision
- Liability
- Uninsured and underinsured
- Roadside assistance
- Rental reimbursement
- Rideshare insurance
USAA offers multiple ways to save with discounts for everything from safe driving to low mileage. You can also earn discounts when you receive good grades in school and successfully complete an approved defensive driving course. USAA has military-related savings, such as for storing your vehicle on base, and legacy discounts if your parents are also policyholders.
One of the best things about USAA is the customer service. J.D. Power consistently rates USAA the top provider for customer service. This isn’t surprising given the number of online tools and level of agent support that it offers customers, although it has a different customer base than other insurers. USAA also receives top scores from AM Best, showing that it is financially stable and can be relied upon to pay its claims.
Read our full USAA car insurance review.
Best on a Budget : Erie
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- Average Price for a 17-Year-Old: $2,248 per year
- Purchasing Options: Online, phone, local agent
- Available Discounts: 8
Erie has a relatively small service area, but young drivers in those states can find some of the most affordable rates for car insurance on the market.
Inexpensive car insurance rates
Good variety of coverage options
Website is easy to navigate
Limited state availability
No online claims
Erie has made a name for itself by offering affordable insurance to teens and young drivers, a group that can face much higher rates for car insurance. Founded in 1925, Erie is a Fortune 500 company that services a very select market on the East Coast. Its insurance products are only available in Washington, D.C. and 12 states: Illinois, Indiana, Kentucky, Maryland, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, and Wisconsin.
Erie car insurance is available in several forms:
- Comprehensive
- Collision
- Bodily injury liability
- Property damage liability
- Uninsured or underinsured motorist coverage
- Roadside assistance
- Rental car expense coverage
- New car protection
- Motorcycle insurance
- Pet insurance
- Rideshare insurance
Erie also offers two exclusive programs: Rate Lock and Auto Plus. Rate Lock helps guarantee your rate. The Auto Plus bundle includes several popular benefits, such as a waived or diminishing deductible, increased policy limits, and transportation expense reimbursement.
Other ways to save include eight discounts, such as for storing your vehicle, bundling your home and auto insurance, enrolling in paperless statements, and making payments in full. Again, Erie steps up to the plate for young drivers, offering extra discounts for those policyholders that are unmarried and live with parents who are active policyholders. You can also save by successfully completing an approved driver’s course.
Erie wins top honors in J.D. Power’s North Central rankings with its 24/7 customer service. It also receives high scores from AM Best, signifying strong financial stability and reliability.
Read our full Erie car insurance review.
Final Verdict
State Farm offers multifaceted coverage and some of the most affordable rates for teens and young drivers who need auto insurance. It’s available in almost every state, and it provides comprehensive coverage with a number of easily accessible discounts.
Compare Providers
| Company | Average Price for 17-Year-Old | Purchasing Options | Discounts | Other Coverage |
|---|---|---|---|---|
| State Farm
Best Overall |
$3,055 | Online, phone, local agent | 13 | Home, renters, life, health, pet, disability, liability, small business |
| Allstate
Best Student Discounts |
$4,716 | Online, phone, local agent | 14 | Homeowners, renters, motorcycle, marine, classic car, RV/ATV, business, life, pet, identity theft, tuition |
| Amica
Best Accident Forgiveness Policy |
$6,156 | Online, phone, live chat | 18 | Home, life, condo, renters, flood, retirement, marine, motorcycle, umbrella, small business |
| USAA
Best for Military Families |
$2,662 | Online, phone, agent | 12 | Motorcycle, ATV/RV, classic car, marine, aviation, renters, landlord, umbrella, flood, farm, mobile phone, life, health, business |
| Erie Insurance
Best on a Budget |
$2,248 | Online, phone, local agent | 8 | Motorcycle, ATV/RV, classic car, marine, renters, flood, life, snow mobiles, golf carts, condo, mobile home, personal valuables, business |
Guide for Choosing the Best Car Insurance for Teens
Does Your Teen Driver Need Car Insurance?
Teens can benefit from car insurance for a variety of reasons. Young drivers may spend quite a bit of time traveling to and from school, friends’ homes, and everywhere else. With less experience on the road, accidents are more likely, and so are other issues. Car insurance not only offers protection from financial and legal liability, but it can also provide extra features like roadside assistance.
It comes at an extra initial expense, but it will be worth it in the long haul if you have an incident on the road. To help save money, many parents will add teens to their policies so they can benefit from their parents’ experience and driving records. Regardless of what you decide, it’s important to get car insurance for your teen so you can meet state requirements.
Comparing Car Insurance for Teen Drivers
Every car insurance company is different, so it’s important to shop and compare to find the best option for you. Examine these factors when shopping around for car insurance:
- Price: Your budget should help determine which car insurance companies you can afford and which ones are simply too expensive. Start by requesting quotes from a handful of companies, like the ones on our list above.
- Coverage: Most companies offer the standard collision and comprehensive insurance, but more unique types of coverage like rideshare insurance for those Uber Eats deliveries may be harder to come by.
- Discounts: Don’t assume you’ll have to pay the basic asking price for auto insurance. Most providers include a variety of discounts that are fairly easy to get, such as for setting up autopay, being a safe driver, or bundling your insurance policies.
- Service area: Some companies only service a select region, such as Erie, so one of the first things to do is ensure that auto insurance from a given company is available for your address.
- Purchasing options:, It’s critical to ensure these options are available through the auto insurance company you choose if you prefer to do all of your business online or through an agent.
- Ratings: One of the best ways to determine a company’s performance is to review its industry ratings, such as J.D. Power for customer satisfaction and AM Best for financial reliability.
How Teens and Young Drivers Can Get Car Insurance Coverage
Collect and compare car insurance quotes from multiple providers to get started. This will not only help you find the best price, but also the right coverage for yourself or your teen driver.
Determine what purchasing options are available once you have the right quote. Some companies only allow you to buy insurance through an agent, while others may allow you to receive a quote and purchase a policy online. Either way, be sure to ask what kinds of discounts are available.
There's typically an online dashboard or mobile app that allows you to manage your payments and view claims when your policy becomes active. You can file claims or request roadside support online in some cases, but you'll have to call in others.
Frequently Asked Questions
How Much Does Car Insurance for Young Drivers Cost?
The cost of car insurance is different for everyone and it depends on a set of specific factors, such as your age, gender, driving history, and credit score. Young drivers have less experience behind the wheel, so they're more susceptible to incidents of all kinds on the road. Teens are generally charged more to compensate for this lack of experience.
Our research into a selection of the top auto insurance companies found the average annual price for 17-year-olds to be $5,095, compared to $1,810 for 42-year-olds and $1,497 for 67-year-olds. That means 17-year-olds are paying an average of 181% more than 42-year-olds.
What Are the Different Types of Car Insurance for Teens?
Although there are some exceptions, most car insurance companies offer:
- Bodily injury and property damage liability to cover the other party's medical care and damages if you're the at-fault driver.
- Collision coverage to cover your own vehicle’s damage regardless of fault.
- Comprehensive coverage to pay for non-accident related damages.
- Personal injury protection/medical payments to cover your medical expenses in case of an accident.
- Uninsured motorist coverage to cover your damages and medical expenses when the at-fault driver doesn’t have adequate coverage.
- Guaranteed asset protection (GAP) coverage to cover the gap between your car's lease or loan and the determined value in the case of a total loss.
How Much Coverage Does a Teen Driver Need?
Most states require drivers to maintain a minimum amount of car insurance in order to legally operate a vehicle. Our guide to state insurance requirements can help you determine how much auto insurance a teen or young driver needs. You’ll likely need personal injury or personal liability coverage depending on your state. This helps pay for bodily injury and property damage you cause in the event of an accident.
What Factors Affect the Cost of Car Insurance for Young Drivers?
Teens have little to no experience behind the wheel, so rates can be much more expensive than those for the average driver. Other factors that can impact the cost of auto insurance for teens are the amount of coverage you buy, the kind of car you drive, and how much you drive each year. Moving violations or accidents on your driving record can also increase rates.
Is It Cheaper to Be on Your Parent's Car Insurance?
It's generally cheaper to be on your parent's car insurance if you're younger than age 25, but a lot of rules can apply as to whether you can do so. You typically can't be covered on your parent's policy if you own your own car or if you don't live with them, although there are usually exceptions to that one if you live away at school through most of the year. The rules can also vary by state.
Methodology
Our team evaluated 25 insurance companies and collected thousands of data points before selecting our top choices. We weighed eight criteria and gave a higher weight to those with a more significant impact on potential customers.
The top picks were selected based on factors like median annual premium (weighted 30%), fairness in pricing methodology (weighted 10%), and regional availability (weighted 15%). We also took into account other features that are important to buyers including complaint scores, consumer satisfaction reports from J.D. Power and Consumer Reports, and company loss ratios.
For further information about our selection criteria and process, our complete methodology is available.
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