Best car insurance providers for young drivers

Travelers frequently appears as the cheapest option for young adults in major market analyses. Data from MoneyGeek indicates an average monthly premium of $232 for new drivers, the lowest among national carriers [3].

Beyond base rates, Travelers is aggressive with its discount structure for students. They offer a “Student Away at School” discount for those who attend college more than 100 miles from home without a car, and a “Good Student” discount for those maintaining a B average or better [4].

While many young adults save money by staying on their parents’ plans, those who must purchase their own independent policy should look at Auto-Owners. The Wall Street Journal identifies it as a top contender for 18-to-21-year-olds on their own policy, with rates often 20% lower than the national average [5].

Auto-Owners also provides a “TrueRide” telematics program. This is an excellent way for responsible young drivers to prove their safety and bypass the high rates typically associated with their age group. For more on how to leverage these behaviors, see our guide on auto insurance discounts for safe drivers.

USAA consistently ranks as the most affordable and highest-rated insurer for customer satisfaction. However, eligibility is restricted to active-duty military, veterans, and their immediate families. For those who qualify, USAA offers specialized discounts for young drivers, including up to 10% off for “Good Students” and a massive 60% discount for vehicles that are stored during a deployment [2]. If you belong to a service family, check out our full list of the best insurance providers for military families in 2024.

State Farm is widely recognized for its “Steer Clear” program, designed specifically for drivers under age

1. By completing a series of training modules and logging accident-free driving hours, young adults can earn significant premium reductions [2]. Their “Good Student” discount is also among the most generous in the industry, offering up to 25% off until the driver turns 25 [4].

Geico excels when a young driver is added to an existing family policy rather than striking out on their own. They offer a “Large Family” discount and a 15% discount for “Good Students.” According to Bankrate, Geico’s national average monthly premium for a 22-year-old is approximately $258, making it one of the most competitive options for early-career professionals [1].

If you are under 25, use these tactical steps to lower your quotes:

• Opt for Telematics: Programs like Progressive’s “Snapshot” or State Farm’s “Drive Safe & Save” track braking, speed, and time of day. Safe habits can result in discounts of 10% to 30%.

• The “Student Away” Credit: If you are heading to university without your car, inform your insurer. You remain covered when you come home for breaks, but your premium will drop significantly while you are away.

• Increase Your Deductible: Moving a deductible from $500 to $1,000 can lower monthly premiums by up to 15%. However, ensure you have the $1,000 in savings in case of an accident.

• Choose the Vehicle Wisely: Insuring a modest sedan or a small SUV is significantly cheaper than a sports car or high-end luxury vehicle, which insurers view as high-theft or high-speed risks.

• Cheapest Overall: Travelers and Geico consistently offer the lowest average rates for the 18–24 age bracket.
• Best Discounts: State Farm’s “Steer Clear” and “Good Student” programs offer the most substantial non-proprietary savings.
• Best for Independence: Auto-Owners is the premier choice for young adults who cannot join a parent’s policy.
• Telematics is Required: For the lowest possible rates, young drivers should use app-based monitoring to prove they are safer than their peers.

Action Plan

1. Get three quotes: Start with Travelers, State Farm, and Geico.
2. Verify your GPA: Secure a transcript if your average is 3.0 (B) or higher to claim the student discount.
3. Compare “Named Driver” vs. “Standalone”: If possible, get a quote for being added to your parents’ policy; it is almost always 20-30% cheaper than an individual policy.
4. Confirm Telematics Eligibility: Enroll in a tracking program immediately to start building a “safe driver” profile.

Young drivers are penalized for a lack of experience, but through proactive discount hunting and safe driving programs, the financial burden can be managed effectively.