Car insurance, also known as auto insurance or motor insurance, is a type of auto insurance policy that protects you and your car against all risks and damages caused by accidents, accidents, thefts or natural disasters. Hence, you will be financially secure in the event of any losses that may arise due to such unforeseen circumstances. Apart from that, you will also be protected against civil liability.
Whether you just want to be legally compliant with the most basic third-party auto insurance, or give your car maximum protection with full auto insurance or your own property damage policy, digit offers you comprehensive third-party auto damage insurance and clean affordable online bonuses.
Things to do before choosing the best car insurance for young drivers
- Decide if you are purchasing a separate auto insurance policy for your child or if you want your teen to be listed on your insurance. The latter option is generally safer – your policy will be extended to your child, with some modifications. For example, many insurers do not give the accident discount to young drivers, but nationwide they will. Many companies offer good student discounts as well as discounts for teenagers who have taken safe driving lessons.
- Compare the car in insurance quotes from several different insurers (including discounts) that provides the best car insurance for young drivers and make a decision.
How are the rates for the best car insurance for young drivers determined?
Rates for young adults are determined in the same way as for older units. There are several valuation factors that contribute to the insurance premium, including:
- Age: Typically, drivers aged 25 and under pay more for auto insurance due to their lack of experience in car insurance, driving may put them at a higher risk of causing accidents than older drivers.
- Make and model of car: Some cars are more expensive to insure than others. Before purchasing a car, it may be a good idea to get a quote from your insurance company to make sure you can afford the insurance.
- Credit: Insurance companies use your credit score to calculate the policy rate. Hawaii, Massachusetts, Michigan, and Washington do not allow the use of credit as a factor in determining auto insurance rates. Statistically, men are more likely to have accidents than women, and these accidents tend to be more serious.
- Location: Car owners who live in areas prone to auto theft and vandalism may pay more for auto insurance. Additionally, each state has different insurance laws, which can affect premiums.
- Mileage: The more you drive, the more likely you are to have an accident. People who only use their cars occasionally tend to pay lower rates than people who are on the road more often.
- Types and amount of coverage: Motorists who also purchase collision insurance and comprehensive coverage. If you own your vehicle, you can purchase the coverage required by the state, but if you are financing a vehicle, the lender will also require you to purchase collision insurance and comprehensive insurance. However, the less coverage you buy the less financial protection you have.
Calculating the average cost of insurance for best car insurance for young drivers
For adolescents WalletHub says teens pay $ 225 to $ 300 per month for auto insurance when added to a parent’s policy and up to $ 450 per month for a solo policy.
Industry estimates indicate that families will pay about 150% more for auto insurance after adding a teenage driver to their policy. For example, if your current policy costs $ 1,000 per year, you will likely pay up to $ 2,500 per year with a new driver in the mix. Your driving history, credit rating, and location all have an impact on increase in your rate.
Factors in Teen Auto Insurance Costs
As mentioned above, the risk associated with insuring teenage drivers is one of the major factors affecting costs. The National Highway and Traffic Safety Administration (NHTSA) reports that driving errors represent approximately 66% of crashes in this age group, due to a lack of experience among teens.
Gender also plays a role in accident risk, which in turn affects insurance rates, according to NerdWaller. Nerd Wallet cites research from the Insurance Institute for Highway Safety (IIHS); the agency notes that men aged 16 to 19 have a fatality rate nearly three times that of other adults. This demographic group is responsible for about 66% of these types of accidents, a significant decrease from 75% in 1975. As a result, WalletHub reports that the average boy pays about 15% more for insurance automobile than the average girl.
Auto insurance premiums are higher for 16-17 year olds than for 18-19 year olds. According to the Centers for Disease Control and Prevention, the first age group has a 200% higher accident rate than the second, due to the high cost.
Cheapest Car Insurance Companies for Young Adults
For young adult drivers, USAA offers the best rates in our analysis and the best car insurance for young drivers. A young adult driver could expect to pay $ 1,086 per year for their auto insurance policy through the USAA. Our data shows that a woman of this age has an average rate of $ 1,033 per year, both representing savings of over $ 400 over the representative average prices for this age group in our study of rates from the world’s largest insurance and the best car insurance for young drivers companies in the country.
Geico is one of the cheapest and the best car insurance for young driver’s insurers for our young adult driver profiles. While individual fares can vary based on many factors, our study shows that a young adult male driver can expect to pay $ 1,185 per year and that a young woman would pay $ 1,228. The study rate for men is almost $ 400 lower than the national average for our young adult driver profile, while the representative rate for women is more than $ 250 lower than the national average.
Our ranking of the best auto insurance companies shows travelers near the bottom of the list. This company tracks its competitors in terms of loyalty and customer satisfaction, although many of its rates are competitive and it is the best car insurance for young drivers.
Company representative rates for young adult driver profiles in our survey are not the lowest in our analysis, but remain relatively affordable. The young adult driver in our studio has a representative rate of $ 1,348 per year, while our male client sample is awarded a scholarship of $ 1,398. Representative fares are $ 140 and $ 156, respectively, lower per year than the nine-company average for young adult drivers.
Nationwide, it ranks in the top half of our ranking of the best auto insurance companies, in large part thanks to customers who said the company is good at handling claims and providing customer service with the best car insurance for young drivers.
When it comes to rates for young adult drivers, Nationwide’s prices are slightly above the national averages determined by our study, although they are still among the cheapest. Young adult drivers have an education rate of $ 1,497, about $ 10 more than the average for the companies we analyzed. The average fare for young adult males is $ 1,608, about $ 54 more than the average.
According to study data, Progressive’s average insurance rate is $ 1,334. This earns it a sixth place among the nine companies we assessed for pricing. The average rate for the nine companies in our study is $ 1,321. The progressive rate is only 1% higher than this rate.
However, there is a fairly significant price difference between Progressive’s rate and those of the cheapest insurance companies in our study. Our research shows that the USAA has the lowest average rate, reaching $ 875. The rate of Progressive is 52% more expensive than the USAA but is the best car insurance for young drivers
Data from the study shows that Allstate, American Family, and Farmers all have higher rates than Progressives, Travelers, Geico, Nationwide, and USAA all have lower rates. Keep in mind that what you pay depends on several factors, including what coverage you choose to purchase, your age, where you live, you’re driving record, and more.