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What Is the Best Car Insurance for First-Time Buyers?

best car insurance for first time buyers

As a new driver, you’re likely eager to hit the open road. But before you do, it’s important to select car insurance you can trust. First-time buyers have many insurance options to choose from, but some can offer you better deals than others. Read on to learn more about car insurance, why it’s important, and how you can get the best deals when insuring your new ride.

What Is Car Insurance?

Car insurance is a contract you enter into with your insurance company. Essentially, you agree to pay a monthly premium, and the insurer will pay for covered costs related to any accidents you experience in your vehicle. Your insurance company will pay for covered services after you meet your deductible, which is set in your insurance policy. While it can seem costly or complicated to find car insurance that works for you, the financial implications of an auto accident can be serious if you’re uninsured. Here are two types of coverage you can expect with your insurance policy:


Liability insurance coverage pays for bodily injury or damage you cause others when in an accident. Your liability coverage might only pay for a certain amount, though, in which case you might have to pay for additional damage out of pocket. Learning more about an insurance company’s liability limits can be an important step before selecting a policy that works for you.


This insurance type covers any damage done to your vehicle in an accident. It usually covers up to the total value of your vehicle. Your premium rates can depend on the value of your car, so think about those costs if you’re considering an expensive or difficult-to-repair vehicle.


Comprehensive insurance is similar to collision, except it covers any damage done to your vehicle that does not involve an accident. Examples would include damage from natural disasters, theft, vandalism, fire, or even cracked or broken windows.

What Happens When You Get Car Insurance for the First Time?

If you’ve never purchased car insurance before, the process can seem daunting. But a little research and preparation can help you find an insurance policy that matches your needs. Before you begin your search, you’ll want to gather important information that can influence your policy options. This includes personal details such as your birthdate, address, employment information, vehicle information, and education level. If you have documentation proving this information, such as a pay stub or diploma, it can help a potential insurer create a logical, evidence-based policy. Your driver’s license can also prove your ability to operate a vehicle legally.

Once you’ve gathered this information, the next step is to research potential insurers and their rates. First, you’ll need to determine how much coverage you need to operate your vehicle safely. Even if the first quote you receive seems like a good deal, chances are you might find a better one if you shop around. You can also look for insurance discounts offered through your employer, school, or other organization.

The discounts associated with certain memberships can be significant, especially if you’re just starting out. If you’re a young driver, you might find savings by staying on your parents’ insurance or by searching for student discount rates. Because car insurance premiums can be based on the level of perceived risk you hold as a driver, newer buyers often face outsized costs because of their lack of experience. Shopping around and learning your options can help you find a fair rate.

Best Car Insurance Companies for First-Time Buyers

As a first-time buyer, the rates you receive can depend on a wide variety of factors, including your age, employment history, educational background, and level of coverage you require. While your individual rates may vary, here are three of the best insurance options you can select when you’re just starting out:

State Farm

The average premium for a first-time buyer with State Farm is $3,842 annually or about $320 per month. This makes it the cheapest option a first-time buyer can pursue. Check out State Farm’s list of potential discounts and offers for teen and new drivers, including an opportunity to save up to 15% if you’re under 25 and haven’t had any at-fault accidents or moving violations within the last three years. You might also earn a discount if you’re under 21 and take an approved driver education course.


Travelers comes in second, with an average annual premium of $4,456 or about $355 per month. While Travelers can be more expensive than State Farm, options like a good student discount can influence your decision. Check out Travelers’ other discount options to see if this company might be your best fit.


On average, the yearly premium for a first-time buyer with Progressive is $4,896, or about $408 per month. Of the three options listed here, this one has the most expensive average. However, your individual quote can depend on a variety of factors an average might not accurately reflect. Be sure to learn more before you commit to a particular company or policy.

For more information about what happens when you begin a policy with Progressive, you can read over the company’s guide for newly insured customers. This resource can also offer more information about the company’s money-saving bundles and other discount options. After completing your research, you might realize Progressive is the best option to meet your needs.

For even the most experienced driver, car insurance can be complicated. First-time buyers, though, might face even more struggles as they look for their initial policy. While it can seem frustrating to juggle so many options, it will be worth it in the end for you to learn as much as possible before selecting a policy.

The three insurance companies mentioned in this article — State Farm, Travelers, and Progressive — are great places to start as you look for a fair rate that matches your needs. With a little research and preparation, you can maximize your discounts. As a result, you’ll protect your wallet and your vehicle when you’re out on the road.

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.


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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