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The cheapest car insurance for 21-year-olds can be found at USAA at $134 per month or $1,609 per year for comprehensive coverage
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Finding cheap car insurance as a 21 year old can be difficult. Monthly and annual premiums tend to be expensive because younger drivers are a higher risk to insurance companies. In this article, we at the Guides Team rank the best car insurance for 21-year-olds and show you how to get a fair price.
Automobile Insurance Guide
Cheapest Car Insurance for Young Adults Car Insurance Discounts Best Car Insurance Companies Average Cost of Car Insurance
The Guide team is committed to providing reliable information to help you make the best possible decision about insuring your vehicle. Because consumers trust us to provide objective and accurate information, we’ve created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of car insurance providers to rate the companies based on a variety of ranking factors. After 800 hours of research, the final result was an overall rating for each service provider, with the insurance companies receiving the most points at the top of the list.
According to our estimates, 21-year-olds pay an average of $2,786 per year or $232 per month for full coverage. That’s about 56% more expensive than the average for 35-year-old drivers, which is $1,785 a year or about $149 a month. Typically, car insurance is much more expensive for 21-year-olds than for older drivers.
Car insurance costs for 21-year-old drivers are determined based on several factors, including driving history, location and credit score. Gender also plays a role in calculating your premiums, especially as a teenager or young adult. For example, young men have a disproportionately higher accident rate, which causes them to pay more for coverage than young women. However, some states do not allow insurance companies to use gender when calculating insurance premiums.
Cheapest Car Insurance For New Drivers
Compared to older drivers, 21-year-olds have less driving experience and are more likely to get into accidents. Car insurance companies compensate for these risk factors by charging this age group higher rates.
According to the AAA Foundation for Traffic Safety, drivers between the ages of 20 and 24 were 74% more likely to be involved in an accident than drivers in their 30s in 2015. Below you can see the accident rates for each age group.
High-risk drivers pay higher rates on average, and young drivers usually fall into this category. You can see below how the average cost by age relates to the breakdown data above.
The cheapest car insurance for 21-year-olds is USAA, which offers an average rate of $134 per month. However, USAA is only available to military personnel, veterans, and their immediate families. Geico is the cheapest company for all 21-year-old drivers, with an average price of $154 per month. Other affordable companies include Auto-Owners Insurance, Erie Insurance and Nationwide.
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The best car insurance for 21 year olds isn’t necessarily the cheapest, but cheap rates definitely help. Below you can see how 11 popular service providers rank in car insurance costs for 21-year-olds.
*Auto insurance plans are based on comprehensive coverage with $50,000 bodily injury per person, $100,000 bodily injury per accident, $50,000 property damage per accident, and $500 deductible for collision coverage and comprehensive coverage.
Location is one of the factors that affect what you pay for car insurance, and rates can vary greatly from state to state. Below are the cheapest car insurance companies in each state for 21 year olds. According to our estimates, USAA and Geico are the cheapest providers in many states.
While 21-year-olds pay an average of $232 a month across the country, drivers in some states pay much less. Insurance in North Carolina averages $129 a month for that age group, for example.
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Whether it’s because of population density or insurance regulations, some states are much more expensive for 21-year-olds than others. Michigan, Connecticut and Massachusetts top the list.
Our top five picks for the best car insurance for 21-year-olds are Geico, USAA, State Farm, Nationwide and Auto-Owners Insurance. When comparing car insurance companies, our team considers cost, reputation, coverage, availability and customer experience. We found that these companies were, on average, affordable for young adult drivers.
Geico is our top pick overall for the best car insurance for 21-year-olds. Car insurance rates for 21-year-olds are around 34% cheaper than the market average for the age group. Geico also offers a good 15% student discount and up to 22% discount for those who have driven for five years without an accident.
The company has been around since 1936 and has an A+ rating from the Better Business Bureau (BBB).
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USAA offers the cheapest car insurance for the average 21-year-old, with prices about 42% below the market average. However, we didn’t name it the best car insurance for 21-year-olds because it’s not available to everyone. You can only qualify if you are in the military, are a veteran, or have a parent who is a USAA member.
USAA not only has low fares for 21-year-olds, but is also known for reliable customer service. The company has an A+ rating from the BBB and achieved the highest rating in nearly every region of the country in J.D. Power 2022 U.S. Auto Insurance Research ℠ .
State Farm is another national provider that offers affordable auto insurance premiums for 21-year-old drivers. Our estimates show that State Farm’s average price is about 17% cheaper than the national average for this age group.
State Farm also offers discounts for younger drivers, including a generous student discount of up to 25% to maintain a B average. Younger drivers can also save money with State Farm’s Steer Clear® program, an app-based driving course for drivers under 25.
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On average, 21-year-old drivers save around 23% at Nationwide compared to the national average. One thing that makes Nationwide unique is that it offers two usage-based telecom insurance options. SmartRide® can provide discounts of up to 40% based on a person’s driving habits by monitoring acceleration, braking, night driving and more. The other option, SmartMiles®, is a pay-per-mile insurance plan that can help people who don’t drive very often save money.
Nationwide has a solid reputation in the industry, earning an A+ rating for financial strength from AM Best and an A+ rating from the BBB.
Another cheap car insurance company for 21 year olds is Auto Owners. Our estimates show that 21-year-olds pay approximately 26% less than the national average car owner. The company offers a good student discount of up to 20% and a discount for students who are absent from school and leave the car at home. However, Car Owners is only available in 26 states.
Fortunately, age isn’t the only thing that determines car insurance rates. There are a few things you can do to find cheap rates on the best car insurance for 21 year olds. We recommend considering the insurance level and excess amount, comparing service providers, monitoring your driving and finding discounts.
Tips And Ideas For Cutting Car Insurance Costs
To save money, you can lower the amounts covered by options such as comprehensive and collision insurance. You can also waive full coverage and only get the minimum level of coverage for bodily injury liability and property liability. Make sure you can cover any costs that your minimum insurance does not cover if you are at fault in an accident.
You can lower your payments by increasing your deductible, which is the amount you pay out of pocket if you file a claim. However, make sure you can afford the deductible.
One of the easiest ways to get a better price is to compare companies. We recommend comparing prices each time your car insurance is due for renewal. The cheapest companies for teenage drivers are not necessarily the cheapest for drivers in their early 20s, so it pays to check prices as you get older.
Getting caught speeding or causing an accident are surefire ways to get higher rates, and 21-year-old drivers already pay more than average. Clean driving history keeps prices as low as possible.
What Is Accident Forgiveness?
Not all companies offer the same discount or the same savings on similar discounts. In our picks for the best car insurance for 21-year-olds above, you’ll see State Farm, Geico, and Auto-owners offer different discount amounts for good students.
Compare offers online to find the right discount for your situation. You can also work with an insurance agent to ensure you find all the appropriate discounts.
Another way for 21-year-old drivers to save money is to follow their parents’ instructions. This is usually only possible if the young driver has the same permanent address as the parents.
In this article, we’ve outlined the cheapest car insurance rates for 21-year-olds and broken down the costs by state. Our top five recommendations for the best auto insurance for 21-year-old drivers are Geico, USAA, State Farm, Nationwide, and Auto-Owners Insurance. Even with our top picks in mind, we recommend that you compare car insurance quotes from multiple companies to find the best deal.
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