Cheap Car Insurance for Young Adults
The best car insurance for young drivers
As you reach your 20s, you evolve from a risky teen driver to a more responsible adult in the eyes of a car insurance company. Whether you remain on your parents' policy or venture out to find your own car insurance coverage, finding a reasonable auto insurance rate can be tricky.
Let's walk through the best ways to save on auto insurance in your early 20s — starting with our list of the best auto insurance companies for young adults as rated by The Zebra Customer Satisfaction Survey.
Key takeaways
- Drivers entering their teens may lose some discounts (good student discount, driving class discount, etc...)
- Young drivers looking for the cheapest coverage should look at USAA, GEICO, and Nationwide
- Young drivers who move out of their parents' homes must then look for their own policy
- Young adult drivers often see their rates falling by the time they reach 25
USAA topped the list among Gen Z drivers in The Zebra Customer Satisfaction Survey with a score of 4.5 out of 5. However, eligibility is limited to members of the military community.
State Farm placed 2nd overall among younger drivers with a score of 4.5 out of 5.
GEICO rounds out the top three with a score of 4.2 out of 5. GEICO is also the cheapest on average for young drivers (after USAA).Â
The Zebra Customer Satisfaction Survey methodology
Findings are based on an online quantitative survey of 4,794 current U.S. auto and home insurance customers, with Census-balanced sampling by age, gender and region. Categories with n=<20 responses are considered insufficient sample size and are not reported. This survey was developed by The Zebra and executed by independent research firm Maru/Blue in 2023.
The best cheap car insurance companies for young drivers
In order to find out which companies offer cheap car insurance for young drivers in their 20s, we examined rates from seven popular insurance companies for all ZIP codes in the U.S. USAA offers the cheapest rates for young drivers. Keep in mind, however, that USAA requires customers to be members of the military community in order to be eligible for its products.
For everyone else, GEICO is among the best options for finding cheap insurance as a young driver, with Natiowide coming in just behind them.Â
Among major insurers, USAA offers the cheapest car insurance for a young driver. However, you must be a member of the military community to be eligible for USAA coverage.
| Company | Avg. Annual Premium | Avg. Monthly Premium |
|---|---|---|
| USAA | $1,936 | $161 |
| GEICO | $2,129 | $177 |
| Nationwide | $2,325 | $194 |
| State Farm | $2,523 | $210 |
| Farmers | $2,652 | $221 |
| Progressive | $2,822 | $235 |
| Allstate | $3,633 | $303 |
Dynamic auto insurance data methodology
Methodology: The auto insurance rates displayed above and throughout this page are dynamic, meaning the data will refresh when the most recent information is made available. Rates are based on a sample driver profile — a 30-year-old single male driver with a Honda Accord and full coverage. This profile was adjusted based on common pricing factors used by major car insurance companies, like age, coverage level, driving record and others.
The profile used to generate the above rates may not match your circumstances. Use the above data as a reference point when comparing car insurance. Try beginning your search for an auto insurance policy with USAA, GEICO and Nationwide before moving on to compare more expensive car insurance quotes.
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Average auto insurance rates for young adult drivers
As mentioned, insurance rates for young adults tend to decrease once the driver ages out of their teen years. See below for average rates for drivers in their early 20s across some common rating factors.
While the cost of insurance is still high in their teens and early 20s, young drivers can expect their rates to fall substantially as they approach age 25.
| Age | Avg. Monthly Premium | Avg. Annual Premium |
|---|---|---|
| 20 | $283 | $3,396 |
| 21 | $229 | $2,744 |
| 22 | $211 | $2,535 |
| 23 | $198 | $2,379 |
| 24 | $188 | $2,255 |
| 25 | $165 | $1,978 |
Do young women pay less than young men?
On the whole, the price difference between young women and men is not as wide as you might expect. On average, young male drivers only pay around $15 per month more than female drivers.Â
| Gender | Avg. Annual Premium | Avg. Monthly Premium |
|---|---|---|
| Male | $2,373 | $198 |
| Female | $2,195 | $183 |
Cheapest states for young adult drivers
Location is an important rating factor when it comes to insurance premiums. The following table shows the top five cheapest states for young adult drivers (ages 20-25), according to our data.Â
| State | Avg. Annual Premium | Avg. Monthly Premium |
|---|---|---|
| North Carolina | $1,284 | $107 |
| Hawaii | $1,412 | $118 |
| Ohio | $1,732 | $144 |
| Idaho | $1,741 | $145 |
| Indiana | $1,812 | $151 |
How life events affect new driver auto insurance costs
There are some gray areas as far as car insurance in your 20s is concerned. Many drivers in their 20s have one foot in the world of adulthood, and another foot in their parents' house. Insurance, in all its forms, reflects the insured party and their assets. With every major life event, car insurance premiums are subject to change. Below are some of the common reasons that your car insurance rate might change and ways that you can prepare for these circumstances.
Marriage and car insurance
After you get married, inform your insurance provider and add your significant other to your policy if you haven't already. This will simplify your car insurance situation in several ways. First, you will likely see an automatic decrease in your premium. By updating your marital status from single to married, you can expect your car insurance premiums to drop by about $89 per year.
Also, it's just easier. As we stated, if they’re not on your policy already you’ll have to exclude them — meaning, anytime they would use your vehicle they would essentially be driving without insurance. This can come back to bite you if you need to switch vehicles, or if you’re unable to drive and need their help.Â
Living with roommates
Most insurance companies have stipulations regarding roommates and shared vehicles — they either need to be listed on your car insurance policy or excluded entirely. Because you and your roommate share a home and responsibilities, an insurance company will assume you might occasionally share vehicles and want to be covered to account for this extra risk.
If you’re living with someone else, either add them to your policy (or you to theirs) or exclude them. Remember, once you exclude a driver, your insurance company will not cover any claims that arise while they are behind the wheel. This means that they must drive your vehicle for any reason.
Renting vs. buying a home
Homeownership opens up some car insurance savings possibilities. Just like getting married, buying a home can decrease your car insurance premium for two reasons. One, if you bundle your auto and homeowners insurance policies with a single company, you could receive a handy multi-policy discount. Second, insurance companies view homeowners as more financially stable than renters and thus reward that stability with more affordable car insurance rates.
Do you need your own car insurance policy in your 20s?
In the simplest of terms, you need your own policy if you are living outside of your parents' residence and drive a vehicle.
Because insurance is ZIP code-specific, living on your own with your vehicle (even in the same city) doesn't allow your insurance company to anticipate the risks they would use to calculate the premium.
You don't need to get your own policy if you don't drive a vehicle or if you still live with your parents.
If you're away at college — usually more than 100 miles away — but don't drive, you should speak with your insurance company about a Student Away From Home discount.
Other ways to save on car insurance as a new driver in your 20s
Aside from your teenage years, your 20s will be the most expensive time to insure your car. Young and inexperienced drivers are considered liabilities for insurance companies and thus are charged higher than other drivers. Still, you can alleviate these higher rates in one of several ways.
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About The Zebra
The Zebra is not an insurance company. We publish data-backed, expert-reviewed resources to help consumers make more informed insurance decisions.
- The Zebra’s insurance content is written and reviewed for accuracy by licensed insurance agents.
- The Zebra’s insurance content is not subject to review or alteration by insurance companies or partners.
- The Zebra’s editorial team operates independently of the company’s partnerships and commercialization interests, publishing unbiased information for consumer benefit.
- The auto insurance rates published on The Zebra’s pages are based on a comprehensive analysis of car insurance pricing data, evaluating more than 83 million insurance rates from across the United States.