Cheap Car Insurance for 20-year-olds

Spend your 20s enjoying life — we'll handle the insurance

How much is car insurance for 20-year-olds?


In 2018, drivers in their 20s paid $1,979 per year for car insurance - about 22% more than the national average. While you're not as risky as a teenager driver, historical data shows drivers in their 20s are more likely to take risks while driving. Anytime you are viewed as a risk to your insurance company, you should expect an increase in your premium. Let's explore some ways to save for car insurance during your 20s.


Finding Cheap Insurance at 20
  1. Cheapest car insurance company for 20-year-olds
  2. Cheapest car insurance companies for young drivers
  3. How much is car insurance for females vs males?
  4. How to save on car insurance




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


Using a user methodology outlined here, we took an average annual premium for drivers between the ages of 20-29 to determine which company has the cheapest rates. If you qualify, USAA has the cheapest rate for this age group. If you do not qualify for USAA, Geico will be your next cheapest option.


CAR INSURANCE FOR A 20-YEAR-OLDS
Insurance CompanyAverage Annual Premium
Allstate$2,636
Farmers$2,020
GEICO$1,438
Liberty Mutual$2,686
Nationwide$1,582
Progressive$2,287
State Farm$2,379
USAA$1,261



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How much is car insurance for young drivers?


Your 20s can be a time of great flux for your personal and financial life. On average, drivers between the ages of 20-24 pay over $800 more for car insurance than drivers between the ages of 25-29. Again, this has to do with the risk of a younger driver compared to a more experienced one. Drivers between the ages of 25-29 historically drive safer and thus file fewer claims. In general, they are cheaper clients for their insurance providers.

In order to find the cheapest car insurance company for young drivers, we got rates for drivers between 20-24 with some popular insurance companies in the US.

Car Insurance CompanyAverage Annual for Young Drivers
Allstate$3,064
Farmers$2,380
GEICO$1,656
Liberty Mutual$3,411
Nationwide$1,907
Progressive$2,749
State Farm$2,909
USAA$1,439



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Your Gender and Your Car Insurance Premium


While you’re under 25, your gender is still a pretty considerable rating factor. As we’ve stated, car insurance companies look at risk exposure (probability you will get into an accident and they will have to pay out a claim) when calculating a premium. And to them, a 20-year-old male driver is riskier than a female. As such, males pay $173 more than average for car insurance than females during a 6-month premium cycle. Still, you should take comfort in the fact that on average, men only pay $1 more per year than women.


AVERAGE ANNUAL PREMIUM BY GENDER
AgeDifference
19$235
20$173
21$154
Average$187




So, how can you save?


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 even if you’re a young driver.


Shop around

The best advice we can give is to shop around with as many car insurance companies as possible. As you saw with our data above, there is a lot of variation based on your 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 quotes from as many different companies as possible. Enter your zip code below to see personalized estimates for you!




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Good Student Discount

Most car insurance companies offer a discount to good students between the ages of 16-25. Basically, if you have a 3.0 GPA or above (on average), your car insurance company can offer you a discount. The reason for this has less to do with a reward for academic success, but the way insurance companies view students 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 FOR GOOD STUDENT AND GOOD DRIVER DISCOUNT
AgeMaleFemale
19$278$160
20$238$139
21$202$117

For more information on a car insurance discounts for students, see our guide here.



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.



Be smart with your claims

Your car insurance has a nasty habit of working as a double-edged sword. The more you use it, the more it will cost. After you file a claim, your insurance provider will give you an accident surcharge for 3-5 years. Looking at our data below, you can see this increase over 3 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 your damages yourself.


AVERAGE ANNUAL INCREASE FOR AN AT-FAULT ACCIDENT
Increase at 6 monthsIncrease at 12 monthsIncrease at 3 Years
+$291+$582+$1,746

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

  • Get an estimate for the cost of repairs at a mechanic 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 3 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 repairs. If it’s cheaper to pay for the repairs yourself, do that.

Keep in mind, however, that this is specific to collision car insurance claims. Not-at-fault accidents or comprehensive claims typically don’t raise your rates as dramatically as at-faults.



Be smart with your car insurance coverage

As your car 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, collision and comprehensive makeup about half of your premium.



Bundle a renter’s 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 your personal property 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 BY BUNDLING
RenterRenter with Multi-Policy
$1,323$1,250


Recent Questions:

Cheap Car Insurance for 20-year-olds

Can I add my 21yo son to my car insurance policy?

Aug 28, 2018

I’m in Florida and have 5 vehicles insured my 21-year-old is buying a 2019 pickup and I need to co-sign ...

Does car insurance drop at 21?

Aug 03, 2018

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Do I have to add my son with a permit to our insurance

Mar 30, 2018

My 21 year old son will be getting his driving permit. We live in NJ. He does not own a ...

Will my 21 year old son get a better rate if he is added to my auto insurance policy?

Aug 08, 2017

He used to be on his dad’s insurance policy but was removed after he moved back to my house. He ...

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Cheap Car Insurance for 20-year-olds

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