Cheap Car Insurance for 20-Year-Olds

How much does car insurance cost for a 20-year-old driver?

The average cost of car insurance for a 20-year-old driver is $232 per month or $1,390 for a six-month policy. This is substantially more than the national average across all age brackets — 20-year-old drivers pay $893 more every year compared to other young adult drivers in their 20s.

While not considered as risky as teen drivers, motorists in their early 20s are riskier to insure than their more experienced counterparts. Whenever a driver is viewed as a risk by an insurance company, it will result in more expensive insurance rates.

Let's explore some ways to save money on car insurance as a 20-year-old driver — including collecting quotes from multiple insurance companies.

Which car insurance company is the cheapest for 20-year-olds?

Using a sample driver profile outlined in our methodology, we analyzed average premiums for 20-year-old drivers to determine which company offered the most affordable rates. GEICO was the cheapest option for a car insurance quote. For qualifying 20-year-old drivers, USAA offered the second-cheapest rates.

BEST CAR INSURANCE FOR 20-YEAR-OLD DRIVERS

Insurance Company	Average 6-Month Premium	Monthly Rate
Allstate	$1,716	$286
Farmers	$1,415	$236
GEICO	$1,004	$167
Liberty Mutual	$1,343	$224
Nationwide	$1,246	$208
Progressive	$1,289	$215
State Farm	$1,236	$206
USAA	$1,078	$180

How much is car insurance for young drivers?

Your 20s can be a time of personal, professional and financial flux. On average, drivers aged 20 to 24 pay over $580 more for car insurance each year than drivers between the ages of 25 and 29 do. This has to do with the increased risk of insuring a younger driver versus a more experienced motorist. Drivers aged 25 to 29 file fewer claims and enjoy more affordable auto insurance premiums.

In order to find the cheapest car insurance company for young drivers, we got rates for drivers aged 20 to 24 from popular insurance companies in the US.

CAR INSURANCE RATES FOR YOUNG DRIVERS AGED 20-24: BY COMPANY

Car Insurance Company	Average 6-Month Premium	Monthly Rate
Allstate	$1,404	$234
Farmers	$1,085	$181
GEICO	$791	$132
Liberty Mutual	$1,706	$284
Nationwide	$877	$146
Progressive	$961	$160
State Farm	$1,002	$167
USAA	$875	$146

Gender and car insurance rates for young drivers

Until your 25th birthday, gender is a considerable car insurance rating factor. Auto insurance companies look at risk exposure (the probability you will get into an accident and they will have to pay out a claim) when calculating premiums. To an auto insurance company, a 20-year-old male driver poses a greater risk than a female driver — males pay $171 more than the average cost for car insurance than females over the course of a six-month premium cycle. Across all age groups, there is less than a 0.5% difference in what men and women pay.

AVERAGE PREMIUM DIFFERENCE BY GENDER

Age	Difference
19	$194
20	$171
21	$121
Average	$162

How to find affordable car insurance as a 20-year-old

Although it might feel like you’re going to pay an arm and a leg because of your age, there are some things you can do to save on your car insurance policy even if you’re a young driver.

 

Compare auto insurance quotes

The best advice we can give is to compare the offerings of as many car insurance companies as possible. Rates vary substantially based on the car insurance company. Keep in mind, the car insurance premiums we presented above are based on a generic user profile. The only way to find rates suited for you is to get a quote from as many different companies as possible. Enter your ZIP code below to see personalized estimates!

Good student discount

Most car insurance companies offer a discount to good students between the ages of 16 and 25. If you have a 3.0 GPA or above (on average), your car insurance company may offer you a student discount. The reason for this has less to do with a reward for academic success, but the way insurance companies view young adults with good grades. Returning to this idea of risk management, car insurance companies see high-performing students as less likely to take risks while driving — all of which makes them a cheaper client. Combined with a defensive driver discount, you can save an average of $189!

AVERAGE ANNUAL SAVINGS: GOOD STUDENT AND GOOD DRIVER INSURANCE DISCOUNTS

Age	Male	Female
19	$278	$160
20	$238	$139
21	$202	$117

Learn more about car insurance discounts for students.

 

Defensive driver discount

If you’ve taken a defensive driving class, meaning a professionally instructed class that your car insurance company usually must approve of ahead of time, you may be entitled to a discount. Like having good grades, car insurance companies see those who have completed these types of courses as safer and cheaper clients.

 

Think twice before you file a claim

Car insurance can be a double-edged sword. The more you use it, the more it costs. After you file a claim, your insurance provider could assess an accident surcharge for three to five years. Looking at our data below, you can see this increase over the course of three years can be as much as your total premium in a year. As such, the general rule of thumb in the insurance world is if you can cover the damages out-of-pocket and you're the at-fault driver, pay for the damages yourself.

AVERAGE ANNUAL INCREASE FOR AN AT-FAULT ACCIDENT

Increase at 6 Months	Increase at 12 Months	Increase at 3 Years
+$335	+$670	+$2,010

 

If you’re unsure of whether or not to file a claim for damages to your vehicle, use this handy breakdown.

• Get an estimate for the cost of the work at a repair shop.
• Use our State of Insurance analysis to see how much an at-fault accident would raise your raises in your state. Consider that value over three years, as that’s usually how long your insurance company will charge you.
• Compare the premium increase and your deductible to the cost of out-of-pocket expenses. If it’s cheaper to pay for the repairs yourself, do that.

Collision car insurance claims have the greatest impact on your auto insurance rates and driving record. Not-at-fault accidents or comprehensive claims typically don’t raise your rates as dramatically as at-fault collisions.

 

Be smart with your car insurance coverage

As your vehicle ages, it loses value. In terms of your car insurance, this means that the coverage you once had on your 2000 Civic might not be necessary anymore. A general rule of thumb in the world of car insurance is if your vehicle is worth less than $4,000, you probably don’t need physical protection. On average, comprehensive and collision coverage make up about half of your premium.

 

Bundle your renters or homeowners insurance policy

If you’re living in an apartment or house, you should have a renter’s insurance policy. A renter’s policy will cover you (your liability) as well as personal property damage in the event of a covered claim. Compared to car insurance, renter’s policies are quite inexpensive — about $150 a year. But if you get your renter’s policy from the same insurance company as your auto, you can expect a multi-policy discount.

AVERAGE ANNUAL SAVINGS: INSURANCE BUNDLING

Renters	Renters with Multi-Policy	Annual $ Savings
$1,483	$1,404	$79