Best Car Insurance For New Drivers

New drivers pose a higher risk for insurance companies, so they’re usually more expensive to insure. To find the best car insurance for new drivers, we researched every major car insurance company and ranked them in areas like coverage, cost, and industry reputation.

Here, we’ll discuss the best car insurance for new drivers, while also covering how to take out a policy, what you should know about car insurance, and how to save money on your premium. Whenever you shop for car insurance, we recommend getting quotes from multiple providers so you can compare coverage and rates.

Best Car Insurance Companies For New Drivers

After reviewing every major auto insurance provider, our top picks for best car insurance for new drivers include Liberty Mutual, State Farm, and USAA. Keep in mind that different providers have different strengths.

To determine which is right for you, consider the types of coverage that are important for you and your car, the discounts you qualify for, and the level of service you’ll receive should you ever need to file a claim. Our overall ratings are out of 5.0 points each.

*Average annual costs are for full-coverage policies based on the profile of a 35-year-old married driver with good credit and a clean driving record.

You may notice that some car insurance companies are listed above those with higher star ratings. This is because our ratings take into account nationwide factors, while our ranking for this article looks specifically at what insurance providers are best for new drivers.

#1 Liberty Mutual: Cheapest Insurance For New Drivers

Founded: 1912

AM Best rating: A (Excellent)

Better Business Bureau (BBB) rating: A+

Liberty Mutual provides the best insurance for new drivers thanks to its affordable rates and many discounts, including:

• Student away at school discount:If you’re a student who has moved onto campus 100 miles or more away from home and did not bring the car to school, you could be eligible for a discount.
• Good student discount: Maintain higher than a B average in high school or college to be eligible for this discount.
• Multi-car discount: This is an argument to stay on your parent’s car insurance policy, because if you add more cars to one policy, you all receive discounted monthly rates.

Liberty Mutual’s RightTrack^® is a usage-based insurance program that monitors a motorist’s driving habits and rewards good habits with a premium discount of up to 30 percent.

Our Verdict: Given the discounts that could benefit young drivers, we think Liberty Mutual is the provider with the best car insurance for new drivers.

Liberty Mutual Average Annual Cost

Unfortunately, we couldn’t procure any averages for Liberty Mutual from Quadrant Information Services. One driver on Reddit reported paying $1,650 per year for 2023 after no accidents, violations, or claims the prior year. Keep in mind that it’s impossible to verify the age and information of this driver, and your own rates could vary significantly based on your specific age and driving history.

Liberty Mutual Customer Reviews

Out of nearly 400 customer reviews, Liberty Mutual has an average 3.3-star rating out of 5.0 on Google Reviews. On the BBB, the customer review score is at 1.1 out of 5.0 stars, with nearly 2,000 complaints.

However, these complaints only make up a small portion of Liberty Mutual’s overall policyholder population, and having many complaints on the BBB is common for top insurance companies.

Like all insurance providers, Liberty Mutual has a steady mix of complaints and positive reviews. Policyholders happy with the company have reported helpful representatives and fast response times during claim processes. However, there are also frequent complaints about bad communication and unfair claims denials.

Liberty Mutual scored just below average for overall customer satisfaction in the large insurers category of the J.D. Power 2022 U.S. Insurance Shopping Study℠. However, it still had the third-highest score in the study.

#2 State Farm: Best Overall Provider

Founded: 1922

AM Best rating: A++ (Superior)

BBB rating: A+

As America’s largest auto insurance provider, State Farm has earned its reputation as one of the most trusted companies around and provides great car insurance for new drivers.

In addition to the standard coverage types, State Farm offers:

• Car rental and travel expenses coverage: You’re covered for the cost of a rental car if your car is not drivable. With travel coverage, the cost of meals, transportation, and lodging are also taken care of up to a certain amount (if your car breaks down more than 50 miles from your home).
• Rideshare insurance: This covers drivers for companies like Lyft and Uber.
• Emergency road service coverage: This type of coverage takes care of the cost of on-site repairs, tows, locksmith services, and gas and battery deliveries.

State Farm has great apps for new drivers, including Steer Clear^®, a driving refresher course that’s available to drivers younger than 25. The company also offers a 25-percent good grades discount and a 15-percent safe driving discount, making it a fantastic choice for young drivers.

Our Verdict: We’ve rated State Farm the No. 1 choice for college students and No. 2 choice for the best car insurance for teens. It’s a highly-reputable company with strong financials and affordable policies.

State Farm Average Annual Cost

At State Farm, the average cost of full-coverage car insurance is about $346 per month or $4,146 per year for 16-year-old drivers. Twenty-five-year-olds can get annual car insurance for roughly $141 per month or $1,686 per year.

State Farm Customer Reviews

Out of roughly 850+ customer reviews, State Farm has a 1.2 customer rating out of 5.0 on the BBB, but this low number only accounts for a small percentage of State Farm’s overall number of policyholders. 

In several J.D. Power studies, State Farm often scores the highest. It was the number one insurer in customer satisfaction for the J.D. Power 2022 U.S. Insurance Shopping Study. It scored highest for the Southwest region of the U.S. in the J.D. Power 2022 U.S. Auto Insurance Study℠ and was in the top three insurers for many other regions.

#3 USAA: Best For Military Members

Founded: 1922

AM Best rating: A++ (Superior)

BBB rating: NR

USAA provides the best insurance for new drivers from military families. The auto insurance company consistently receives high marks from industry experts, sweeping the board in multiple 2021 and 2022 J.D. Power studies.

Some benefits to getting USAA car insurance include quality customer service and a variety of discounts, like the military installation discount of up to 15-percent off for garaging a vehicle on a military base.

Our Verdict: Although USAA is only available to a small number of new drivers, we think the impressive ratings and discounts make it worth a look for anyone who’s eligible. Find out more about coverage and eligibility in our complete USAA auto insurance review.

USAA Average Annual Cost

USAA typically offers cheaper average rates when compared to State Farm, but this isn’t the case for younger drivers.

Sixteen-year-olds may have to pay an average full-coverage cost of $399 per month or $4,784 per year. Twenty-five-year-olds can get annual car insurance for roughly $108 per month or $1,292 per year.

USAA Customer Reviews

USAA has some of the best customer satisfaction in the industry. Since the company only applies to military members and family, it isn’t ranked in J.D. Power consumer studies, but does get scored. USAA has the second-highest score in the latest Insurance Shopping Study for customer satisfaction and scores the highest in all U.S. regions except California for the 2022 Auto Insurance Study.

USAA doesn’t have a great customer rating on Trustpilot, at only 1.3 stars out of 5.0 from nearly 2,000 reviews. However, the amount of complaints on Trustpilot for USAA are very small compared to USAA’s actual number of happy policyholders. Plus, many complaints about USAA are not about its auto insurance, specifically.

#4 Geico: Best For Discounts

Founded: 1939

AM Best rating: A++ (Superior)

BBB rating: A+

Geico’s strong reputation is marked by high marks on several J.D. Power studies, and a strong rating from AM Best. Geico’s AM Best rating shows that the company is financially stable and more likely to pay out claims.

Along with standard coverage, Geico offers extra types of coverage like:

• Roadside assistance
• Mechanical breakdown insurance
• Rental car reimbursement

Our Verdict: Geico offers the best overall car insurance in the industry and has some of the best insurance for new drivers according to our research. With impressive discounts, a longstanding positive reputation, and affordable rates, Geico is a great choice for teens.

 Geico Average Annual Cost

At Geico, the average cost of full-coverage car insurance is about $372 per month or $4,466 per year for 16-year-old drivers. Twenty-five-year-olds can get annual car insurance for roughly $118 per month or $1,420 per year.

Geico Customer Reviews

Geico isn’t as well known for its customer satisfaction as State Farm and USAA are. It often performs below industry average in several J.D. Power consumer studies. It only has a 2.8 rating on Google Reviews and a 1.2 rating on the BBB.

However, Geico’s level of customer satisfaction was very good in a car insurance survey we conducted in August 2022, where we polled nearly 7,000 car insurance customers. Geico’s customer base made up 16 percent of the respondents, who gave the company 4.1 stars out of 5.0 for overall satisfaction.

Positive reviews tend to highlight Geico’s customer service, while negative reviews focus on a slow claims process and bad communication.

#5 Progressive: Best Usage-Based Insurance

Founded: 1937

AM Best rating: A+ (Superior)

BBB rating: A+

Progressive is known for having more affordable rates for high-risk drivers, which makes this coverage beneficial for new drivers with little experience. We think Progressive is one of the best auto insurance providers in the nation because of its competitive industry tools and discounts.

Progressive maintains an advantage over its competitors with exclusive tools like the Name Your Price^® tool and Snapshot^® program. Name Your Price constructs a Progressive policy with your budget in mind, and Snapshot collects data from an app in your phone about your driving habits to adjust rates based on safe driving behavior.

Our Verdict: With discounts like Snapshot and accident forgiveness that won’t let your rates go up after your first at-fault accident, Progressive is a strong contender for the best insurance for new drivers.

Progressive Average Annual Cost

Progressive doesn’t have the best rates for drivers of younger ages, but it does offer multiple savings opportunities, as previously mentioned.

The average cost of full-coverage car insurance is about $931 per month or $11,174 per year for 16-year-old drivers. Twenty-five-year-olds can get annual car insurance for roughly $161 per month or $1,934 per year.

Progressive Customer Reviews

Progressive is not known for its customer satisfaction. In the J.D. Power Auto Insurance Study, the car insurance scored below the average for customer satisfaction in each region of the U.S. Negative reviews across multiple customer review sites suggest bad experiences with dealing with claims denials after being hit by Progressive customers in car crashes.

However, in our August 2022 survey, Progressive scored a solid 4.1 stars out of 5.0 for customer satisfaction. Positive reviews of Progressive focus on its speedy claims process.

Why Is Car Insurance For New Drivers So Expensive?

While higher rates for new drivers are definitely frustrating, they are admittedly understandable. New drivers have two factors going against them: inexperience and lack of track record. New drivers are more likely to slip up and forget to check their blindspots, misunderstand the right of way, or make another mistake that will cause an accident.

On top of that, new drivers don’t have a track record to back them up–it’s like walking into a job interview with no previous experience.

In many cases, there’s also a third factor that increases new driver insurance premiums: age. Most new drivers are young, and teenagers have a crash rate that’s almost four times that of drivers 20 and older, according to the Insurance Institute for Highway Safety.

If you’re young and inexperienced with no track record to back you up, there’s a lot of risk for auto insurance companies. That’s why it’s so important to find the best insurance for new drivers.

Aside from a younger driver’s age, there are other factors of a motorist’s profile that insurance companies use to set a premium rate, such as:

• Location
• Gender on driver’s license
• Marital status
• Accident history
• Traffic violation record
• Credit score
• Vehicle details

How Your Credit Score Affects Car Insurance

Your credit report can also affect your rates. If you’re a new driver, there’s a good chance that you’re young and you might not have a good credit score yet. Unfortunately, it’s easy to get a bad score as a young person since you probably have less history and available credit to work with.

California, Hawaii, and Massachusetts don’t allow credit scores to affect your car insurance. But, if you live in another state, you could pay more for having a poor score. Here’s how your credit score can affect your rate according to our data (not including CA, HI, or MA):

How Does Your Vehicle Affect Your Insurance Premium?

The make and model of your vehicle can raise or lower your risk of getting in an accident, the cost of repairs, and consequently the risk your insurance provider takes when covering you.

To put it simply: it’s less expensive and risky for providers to insure an unassuming Hyundai Santa Fe with numerous safety features than it is to insure a $300,000 Lamborghini.

The following factors affect your insurance premium and are an important consideration in the search for the best insurance for new drivers.

• Vehicle year: The year of your car will play into an insurer’s risk profiling procedure. Some insurance companies offer new car discounts.
• Vehicle make and model: Higher-end models are more expensive to insure, and your premium will reflect that.
• Safety features: The more safety features your vehicle has, the lower your vehicle’s risk profile is unless those features require very hi-tech and expensive components.
• Theft prevention systems: Active and passive theft prevention systems affect your premium to different degrees. Passive systems are generally preferred by insurance companies.

How To Get Cheap Car Insurance For New Drivers

Unfortunately, cheap insurance for new drivers may be a bit of a misnomer. That said, it’s possible to get cheaper car insurance as a new driver in a few different ways:

• Stay on your parents’ plan: Most insurance companies offer discounts for plans that insure multiple people, so if at all possible, stay on your parents’ plan to lower your rate.
• Build a clean driving record: New driver or not, maintaining a clean driving record free from accidents and traffic violations is by far one of the best ways to keep your premiums low.
• Look for discounts: Consider taking a defensive driving class, which will lower your premium right away with some insurance companies. Many providers offer other programs to lower costs for new drivers too.
• Raise your deductible: You can lower your car insurance costs by raising your deductible, as long as you can still manage to cover it if an accident should happen.

While many of us wish we could stay young forever, growing old is universally looked forward to when it comes to car insurance. After the age of 20, car insurance rates slowly begin to decrease.

However, the most drastic decrease is after age 25, just like for rental cars. If you can maintain a clean driving record from the time you start driving until you’re 25, you’ll be well-positioned for a low and affordable premium when you hit that milestone.

Common Car Insurance Discounts

As mentioned, new drivers can save on car insurance by looking for car insurance discounts. Here are the most common ones offered by many auto insurers:

What Kind Of Car Insurance Do New Drivers Need?

New drivers don’t need a special type of auto insurance–they just need to make sure they meet their state’s minimum requirements. These requirements differ from state to state, so it’s important to check your state’s laws.

Most states require you to take out liability insurance at a minimum. This covers the costs associated with bodily injuries to other drivers and passengers, as well as property damages. However, this type of insurance is only designed to cover other parties in an accident you cause. It won’t take care of your own medical bills or car repairs.

In addition to liability insurance, some states require drivers to have personal injury protection and uninsured/underinsured motorist insurance. In total, there are six common types of car insurance that are usually put in full-coverage policies. These include:

Determining the required car insurance for new drivers depends on your state. For example, California only requires bodily injury and property damage liability for all drivers, but New York requires personal injury protection and uninsured motorist bodily injury in addition to liability coverages.

However, in most cases, it’s not advisable to simply take out the minimum coverage. All of the types of coverage listed above can save you from serious financial disaster if the unexpected occurs, so we recommend finding a policy that provides full coverage if it’s financially feasible for you.

In addition to these standard coverages, some of the best insurance for new drivers can include premium coverage options that provide peace of mind to many motorists. These include options like:

• New car replacement coverage: If you total your car within a certain period of time (usually two to three years), your insurance provider will cover the cost of a brand new vehicle of the same make, model, and trim.
• Loan/lease gap insurance: This covers you if you total your car before your lease or loan is paid off in full. This may be required by your lender.
• Rental coverage: This type of coverage reimburses the cost of a rental car for a specified period of time if your car is not drivable.

How To Shop For Car Insurance Quotes

Most car insurance companies have online quote tools that you can use to get instant quotes for free. You’ll typically need to enter your ZIP code and details about your car. This usually includes its make, model, and mileage. You may also be asked to provide your email address and age.

You can also call an insurance agent directly. It’s important to compare quotes from at least three different providers when shopping for car insurance.

FAQ: Best Car Insurance For New Drivers

How We Rate Insurers

Our review process aims to deliver consistent and unbiased assessments of car insurance providers. While there are multiple qualities that make a car insurance company successful, our review team focuses on those we believe are the most important for consumers:

• Cost: Cost can be difficult to compare between insurers because so many factors impact annual premiums. The cheapest insurer for one driver may not be the cheapest for another. To determine our cost score, we look at insurance rate estimates generated by Quadrant Information Services, discount opportunities, and consumer reports.

• Coverage: To determine our coverage score, we look at the number of coverage options available as well as coverage limits and deductible options. Our ratings also take into account additional services and benefits like roadside assistance.
• Reliability: It’s important that an auto insurer is able to meet its claims obligations. Companies with a strong financial strength rating from AM Best score best in this category. Established insurers with a long history of reliable service also receive positive marks.
• Service: We comb through customer reviews on sites like the Better Business Bureau (BBB) to learn about customer experiences. Insurers with a low volume of complaints score well in this area. We also consider the claims process, giving higher ratings to car insurance providers that offer easy-to-use claims apps.

*Data accurate at time of publication.