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Cheap Car Insurance for First-Time Drivers

cheap car insurance for first time drivers
TABLE OF CONTENTS

Whether you’re a teen driver, the parent of one, or you’re simply getting your license for the first time later in life, finding the cheapest insurance available to you can help you relieve some of the pressure off of your wallet. Read on to discover everything you need to know to get started on your search for your first auto instance plan and the cheapest rates for them.

How To Find Cheap Car Insurance for First-Time Drivers

To find the cheapest car insurance for a first-time driver, you must decide what you’re looking for in your insurance plan. Are you searching for the all-around cheapest car insurance you can find? Look for a liability-only car insurance plan. Liability plans don’t cover your damages in an accident — only those of other people involved in the accident.

Research your state’s requirements for minimum car insurance. Generally, it’s liability coverage but some states don’t require you to have any car insurance coverage, such as New Hampshire and Virginia. If you live in these states, you’ll still be responsible for paying up to a certain amount out of pocket.

If you want more protection from your first-time car insurance plan, consider upgrading your policy with collision and comprehensive coverage. Collision insurance is similar to liability, but it helps you pay for the costs of your own bodily injury and property damage. Comprehensive insurance helps pay for damages that occur outside of collisions and may be required if you’re leasing your vehicle.

Reading Car Insurance Plans

As you shop for cheap car insurance for first-time drivers, you’ll find liability plans written in three parts, often combined and separated by slashes. These numbers are the maximum limits of coverage for bodily injury per person, bodily injury per accident, and property damage coverage.

Let’s take New Mexico’s minimum liability insurance coverage requirement for example. To drive legally in New Mexico, you’ll need a liability insurance plan that offers:

  • $25,000 per person for bodily injuries
  • $50,000 per accident for bodily injuries
  • $10,000 per accident for property damage

Sometimes you’ll see the coverage limits listed out like they are above. Insurance companies might also display them in two other formats:

  • $25,000/$50,000/$10,000
  • 25/50/10

These all mean the same thing. They should always be in the order of bodily injury per person, bodily injury per accident, and property damage per accident. Now that you have a better idea of what to look for in your first-time driver’s insurance, let’s get into how you can find the cheapest plan available to you.

Cheap Car Insurance for First-Time Drivers

New drivers can expect to pay more for their car insurance than drivers who have maintained driving records for years. On average, according to ValuePenguin, new drivers under the age of 25 pay $2,243 per year for their car insurance. However, a little shopping around may help you find a plan lower than that average. Here are some of the major names in insurance and what they charge for liability-only plans on average for first-time drivers under the age of 25:

  • Allstate: $1,205
  • USAA: $1,390
  • State Farm: $1,547
  • GEICO: $1,572
  • Nationwide: $3,363
  • Farmers: $4,495

These averages drop significantly if you’re a first-time driver over the age of 25:

  • Allstate: $395
  • State Farm: $589
  • USAA: $712
  • GEICO: $950
  • Nationwide: $1,058
  • Farmers: $1,708

Though these average costs give you an idea of where to start searching for car insurance, you should explore your options outside of them as well. Many factors come into play in determining the amount you’re going to pay for your insurance. Location is key — what may be the cheapest option for drivers in Los Angeles may not be the cheapest option for drivers in Frankfort, Kentucky. Read on for tips on how you can find the best insurance plan for you and your wallet.

How To Lower Your Insurance Cost

You’re certainly not stuck paying the same rate for years to come. You have several methods and tools you can use to lower the cost of your insurance. Some you can take advantage of today — some you’ll have to plan to take advantage of in the future.

Get Multiple Quotes

The best thing you can do if you want to save money on your car insurance now rather than later is to get quotes from multiple companies. Quotes allow you to ask how much an insurance company plans on charging you for coverage without you having to go all-in on paying for it. By gathering quotes, you can compare and contrast insurance companies’ offerings to find the best option for you.

If you’re simply looking for the cheapest car insurance for first-time drivers, this is a pretty cut and dry approach. But if you want the best insurance, be sure to look at what’s included in the plan that you’re getting quotes on. One quote may be more expensive than another because it includes a sought-after feature that you might want to take advantage of.

Age

In your case, age may be an important aspect of your insurance cost. If you or your first-time driver is a teenager or young adult, you’re looking at higher insurance costs due to young age. These types of drivers are considered higher risks due to a perceived lack of experience, so insurance companies will charge more to cover the gamble. After a few years of maintaining a safe driving record, these costs should decrease. The difference in annual cost between insuring a 16-year-old driver and a 21-year-old driver is in the thousands of dollars.

Bundling

One of the most effective methods of reducing the cost of car insurance is by bundling policies. Try to include the first-time driver’s insurance into a family policy. If that’s not an option, try to bundle car insurance with other policies through the same company, such as home or life insurance.

Higher Deductibles

Increase the amount you pay out of pocket when your insurance coverage is triggered to potentially reduce the amount you pay monthly or annually for your plan. Generally speaking, the higher your deductible, the smaller your insurance payments will be.

FIXD Research Team

At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.

We’re here to help you simplify car care and save, so this post may contain affiliate links to help you do just that. If you click on a link and take action, we may earn a commission. However, the analysis and opinions expressed are our own.

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About the Author

FIXD Research Team

FIXD Research Team

At FIXD, our mission is to make car ownership as simple, easy, and affordable as possible. Our research team utilizes the latest automotive data and insights to create tools and resources that help drivers get peace of mind and save money over the life of their car.

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