What Is the Cheapest Car Insurance for a 16-Year-Old?
The cheapest car insurance for a 16-year-old is not always easy to find. However, by comparing quotes and considering available discounts, you can ensure that you have the coverage you need at an affordable price.
Average Car Insurance Rate by Age
Car insurance rates for 16-year-olds vary from state to state. But 16-year-olds tend to pay the highest rates. Drivers between the ages of 16 to 19 years old pay more than drivers in any other age range. This payment level is due to the minimum driving experience, making younger drivers more at risk of accident involvement and filing a claim. While you are likely to have the highest rates when you are 16 years old, the average annual rate will usually decrease with each year:
- 16 years: Average annual rate of $2733 (minimum coverage) and $6613 (full coverage).
- 17 years: Average annual rate of $2206 (minimum coverage) and $5373 (full coverage).
- 18 years: Average annual rate of $1938 (minimum coverage) and $4837 (full coverage).
- 19 years: Average annual rate of $1451 (minimum coverage) and $3716 (full coverage).
Some of the cheapest insurance providers for 16-year-old drivers tend to be Geico, Allstate, Progressive, and State Farm . Car insurance for a teen driver can be costly, but parents can seek cheaper rates.
How Gender Affects Insurance Rates
Gender can also affect insurance rates. According to Nerdwallet, male teen drivers tend to pay higher rates compared to females. The following insurance providers have the largest variation among genders for full car insurance coverage:
- Allstate: Average annual rate of $5563 (females) and $6427 (males).
- Geico: Average annual rate of $3126 (females) and $3577 (males).
- Progressive: Average annual rate of $6454 (females) and $7170 (males).
- State Farm: Average annual rate of $4328 (females) and $5232 (males).
- USAA: Average annual rate of $3253 (females) and $3556 (males).
A driver's gender can also affect minimum coverage policies:
- Allstate: Average annual rate of $1191 (females) and $2174 (males).
- Geico: Average annual rate of $1180 (females) and $1316 (males).
- Progressive: Average annual rate of $2440 (females) and $2632 (males).
- State Farm: Average annual rate of $1759 (females) and $2120 (males).
- USAA: Average annual rate of $1288 (females) and $1369 (males).
While USAA tends to have cheaper rates, coverage is available only to active military and family members.
How to Get the Cheapest Car Insurance at 16 Years Old
Buying coverage under an existing policy with your parent is the best way to get affordable insurance as a 16-year-old. Alternatively, you can obtain insurance quotes from multiple providers to save money.
While insurance laws vary from state to state, many states do not require drivers to have full coverage. However, if you drive a new car with a loan or a lease, you may be required to carry full coverage based on your buyer agreement. To follow state laws, you need insurance that covers the state-required liability coverage. The minimum level of coverage will usually cover the damages to another driver's vehicle if you are in an accident. It will not cover your own damages.
Since teen drivers are less experienced and are more likely to be in an accident, it may make sense to have full insurance coverage.
Depending on where you live, you may have to follow certain laws as a new driver. Some states restrict 16-year-old drivers to the locations or times in which they can drive. New drivers must follow these laws until they are 18 or have their Graduated Drivers License. At this age, they may qualify for a cheaper rate.
Available Discounts to 16-Year-Old Drivers
When shopping around for rates, be sure to consider what discounts are available. The following discounts are some of the most common types available:
- College student discount: If you are studying at college, you may be eligible for a discount.
- Defensive driver discount: Some providers may allow you to take a defensive driver course to receive discounts.
- Good student discount: Some providers offer discounts to students with a high GPA or excellent grades on their report cards.
- Safe driver discount: According to The Zebra, traffic violations or accidents on your record can increase insurance rates by as much as 60 percent. Additionally, you may be eligible for discounts if you have a clean driving record.
Keeping a 16-year-old driver on the family insurance plan is usually the best approach. Moving teen drivers to their own policy can lead to them paying as much as $1600 more per year. If teen drivers live at home, the liabilities are another reason to consider keeping them on the policy. If they buy their own policy but drive the family vehicle, they may not be covered under your policy.
Filing an Insurance Claim as a 16-Year-Old Driver
Regardless of whether you are at fault, filing an insurance claim can lead to a significant increase in rates. It is always a good idea to consider how a claim will impact your rates. Many insurance companies increase your annual rate by as much as $670 per year if you are at fault for an accident.
Before filing a claim, it can be helpful to calculate the cost of doing so. Add up the cost of repairing your vehicle with the average increase of filing a claim to your insurance rates. Next, add your deductible to the total.
Cheapest Car Insurance for a 16-Year-Old
The cheapest car insurance for a 16-year-old tends to be with the following insurance providers. Note the premium amounts per provider.
- American National: $1193 six-month premium or $199 per month.
- Erie: $1402 six-month premium or $234 per month.
- Auto-Owners: $2139 six-month premium or $357 per month.
- USAA: $2401 six-month premium or $400 per month.
- American Family: $2528 six-month premium or $421 per month.
- ALFA: $2580 six-month premium or $430 per month.
- Nationwide: $2702 six-month premium or $450 per month.
- Geico: $2911 six-month premium or $485 per month.
- State Farm: $3144 six-month premium or $524 per month.
- Amica: $3312 six-month premium or $552 per month.
The insurance rates above are for minimum coverage. First, consider how much coverage you may need and the deductible you are willing to pay.
Teen drivers tend to pay higher rates when it comes to buying auto insurance. By staying on the family insurance plan or shopping around, you can find the cheapest car insurance rates.
Sources:
https://www.nerdwallet.com/blog/insurance/getting-cheapest-car-insurance-teenagers/
https://www.thezebra.com/auto-insurance/driver/age/car-insurance-16-year-olds/
https://www.caranddriver.com/car-insurance/a35604948/state-farm-car-insurance/
https://www.caranddriver.com/car-insurance/a35590611/car-insurance-premium/
