It’s exciting to turn 18! You have become an adult and may be finishing high school or heading off to college. However, being an adult has its responsibilities and freedoms. Having a good car insurance policy is an essential part of managing your finances.
An average 18-year old pays $5,243 annually to get full coverage and $1,652 for minimal coverage. This is more than the national average car insurance cost. Insurance companies view young drivers as having less experience and more likely to cause an accident. You might be able to understand how your rates are calculated, and what you can do about it to lower your premium. This will help you manage your car insurance.
What is the cost of car insurance for 18-year olds?
The average premium for 18-year olds is high. They pay $5,243 per annum for full coverage and $1,652 for minimum coverage. The reason is that 18-year olds are not allowed to drive for very long. Drivers between 16 and 19 years old are more likely to be involved in motor vehicle accidents that any other age group.
Statistics from the National Highway Traffic Safety Administration show that teenage deaths are primarily due to car accidents. In 2018, there were over 2,000 teenagers who were involved in car accidents. Insurance companies are charging more for young drivers to offset the increased risk.
Average cost for men and women
The premiums for car insurance are determined by the gender of the insured. Male drivers will pay more for insurance than if they are younger. Statistics show that male drivers are more likely to engage in dangerous driving habits, which could lead to more serious accidents.
Below is a table that breaks down the average cost for full coverage and minimal coverage car insurance for 18-year old males and women on their own policies. Insurance laws can vary from one state to the next. Some states ban gender as a rating factor. These states have men and women paying almost the same amount of insurance, assuming that all other factors are equal.
For 18-year-olds, the cheapest car insurance companies
Low average premiums are one of the best ways to save money on car insurance. The average premiums for the top carriers in terms of market share were obtained by Bankrate’s editorial team. The premiums were then analyzed to identify the 18-year-old companies with the lowest average rates.
Erie
Erie is a regional carrier. It may not be available nationally, but you might want to get a quote if you are in one of the 12 states that it is. There are many optional coverages available, and teen drivers may be eligible for discounts. Erie also received an above-industry-average score in the 2020 J.D. The Power U.S. Auto Claims Service Satisfaction Study shows that most customers are satisfied with the claims service.
USAA
J.D. consistently gives USAA high marks. Power, but the company is not eligible to be ranked officially due to its eligibility restrictions. USAA coverage is available only to the immediate family of active and retired military personnel. You might be eligible for a discount if your parents had USAA insurance. You might also save if you’ve completed a driving course or have good grades.
Auto-Owners
Auto-Owners is available in 26 states and is a regional carrier, just like Erie. Three teen discounts are available: student away from school, good student and teen driver monitoring. You can save money by signing up for a paperless or another policy with Auto Owners, paying in full or having another policy. The National Association of Insurance Commissioners (NAIC) gives Auto-Owners a low complaint score. The NAIC receives an average number of complaints with a score of 1.00. The score for Auto-Owners personal automobile product is 0.64. This indicates that the NAIC received less complaints than usual.
Geico
Geico is consistently one the most affordable car insurance companies. While its premiums may not be the lowest for 18 year-olds, it could offer competitive rates in your region. Geico also offers a wide range of discounts that can help lower your premium. A car that has certain safety features, is a student or wears a seatbelt could help you save money.
Country Financial
Although Country Financial might not be as well-known as the others on this list, the average premiums offered by the company are significantly lower than the national average car insurance cost for 18-year olds. Country Financial sells insurance only in 19 state. If you are eligible, you might want to request a quote. Country Financial offers discounts for students and driver training, along with more traditional discounts such as safety features and defensive driving.
How 18-year old drivers can save money on their car insurance
There are many ways that young drivers can save money on their car insurance. While most of these strategies involve discounts, there are also other options.
These are some of the best ways that an 18-year old can save money on car insurance.
Good student discount
Good grades make teens statistically less likely to speed or drive recklessly. Many insurance companies offer discounts for good grades. This discount is only available to full-time students. To prove your eligibility, you will need to submit a copy your most recent grade card. Each company has its own rules, but a minimum GPA of 3.0 or a letter-grade average of B is common.
Distant student discount
You might be able save on car insurance if you don’t plan to drive to college. This option is only available to parents who are already insured. You will usually be covered to drive while you are at home during breaks. However, your company may have different rules.
Telematics and car insurance discounts based on usage
Many companies offer discount programs that monitor your driving habits and give you a customized discount. Nationwide’s SmartMiles tracks your driving habits and allows you to pay only for the miles driven. This is because you are less likely to get into an accident. To personalize your discount, Progressive’s snapshot tracks additional habits, such as speed, hard brakes and accelerations.
Opt for a higher deductible
Your policy will have two deductibles if you have full coverage: one for collision and one for comprehensive. You will have to pay the appropriate deductible if you file a claim against your vehicle for damage. The insurance company will then pay the remainder of the claim. Your premium will be lower if you increase your deductible. If you have to file a claim, however, you need to ensure that you can afford the deductible.
Utilize discounts
Many insurance companies offer discounts. You might be able to save money by taking advantage of all they have. You may also be eligible for good student, distant student, and telematics discount.
How to get the best 18-year-old insurance
Even if you are new to car insurance, it is easy to get a great policy. However, it does require some research and understanding. You might consider these things before you start shopping for insurance.
- Learn how to read a quote. Car insurance policies include bundles of multiple coverages. Knowing the meaning of these coverages can help you choose the right options for your needs.
- Consider your needs. Do you need a company with a mobile app? Do you want ridesharing coverage for Uber and Lyft jobs? What amount can you spend on car insurance? It could make it easier to shop for car insurance by knowing what factors are most important to you.
- Get quotes from multiple companies: Once you have identified the factors that matter to you, it is possible to get quotes from multiple companies that match your needs. This will enable you to compare premiums, coverage options and discounts as well as policy features and third party scores.
- Discounts are not always available. Talking with a representative can help you to find other ways to save.
Talking to an agent may be helpful if you’re new to buying auto insurance. An agent can help you determine the best coverage for your needs.
Questions frequently asked
Do I need my own coverage? Or should I stay with my parents’ insurance?
You may be eligible to continue your parents’ auto insurance policy if you live at home. This is generally cheaper than the other options. You may still need to have your own policy if you are living on your own, or if you own your vehicle without a parent co-signing.
What is the difference between full coverage and minimum coverage?
The minimum coverage is the purchase of only the minimum required car insurance coverages. They will vary from one state to the next. Full coverage is when you add comprehensive and collision coverage to your vehicle to provide coverage for any damage. On a full coverage policy, some companies or agencies might also offer uninsured motorist coverage.
How can I determine how much coverage I should buy?
The amount of car insurance that you buy is up to you. You must purchase coverage that meets the minimum requirements of your state. Car insurance companies won’t allow you to buy less. Insurance agents advise that you purchase higher liability limits in order to have better financial protection in the event of an accident. Your lender may require that you carry full coverage if you have a loan, lease or other financial obligation. Your individual situation will determine the coverage limits, deductibles, and optional coverages that you select.
