Cheap car insurance 24 year old male
- Search Affordable Car Insurance Options Near You
- Best Cheap Car Insurance Companies
- How I Chose the Best Cheap Car Insurance Companies
- Where to Find Car Insurance Discounts
- Major Car Insurance Types
- What types of car insurance do I really need?
- What car insurance is required in my state?
- Six Tips to Find Cheap Auto Insurance
- Search Affordable Car Insurance Options Near You
- It’s Time to Save on Car Insurance
- Search Affordable Car Insurance Options Near You
- How much is car insurance for a 16-year-old?
- Cheap car insurance for a 16-year-old
- Can a 16-year-old own and insure a car?
- Adding a teen to parents’ policy is usually more affordable
- Insurance for teen drivers
- Do you need insurance to drive with a learner’s permit?
- Do you need insurance to get a license?
- What's the best insurance for teenage drivers?
- Car insurance discounts for 16-year-olds
- What are the best cars for a 16-year-old?
- Dangerous times for 16-year-old drivers
- This year’s best-selling vehicles
- States with highest car insurance
- States with the cheapest car insurance
- Providing real cost estimates
- How much does car insurance cost?
- Average cost of car insurance by state
Getting the minimum amount of car insurance is risky business. However, not everyone can afford a bunch of additional coverage. And, some people might not need anything but the minimum. In those cases, having state-mandated coverage is far better (read: legal) than having no insurance at all.
But how do you find the cheapest rate? I examined over 250 quotes from 28 different companies and found three auto insurers that offer the most affordable policies anywhere in the country. Keep in mind, though, everyone’s individual rates will vary.
Search Affordable Car Insurance Options Near You
Enter your zip code below and be sure to click at least 2-3 companies to find the very best rate.
Best Cheap Car Insurance Companies
- State Farm
How I Chose the Best Cheap Car Insurance Companies
First, I found the top five to seven insurance providers in each state by selecting companies with above-average customer satisfaction ratings from J.D. Power and high financial strength marks from A.M. Best. Why? Because cheap auto insurance policies are great, but purchasing them from unreliable or fickle insurers could wind up being far more expensive down the road.
Then, with some help from the team at The Simple Dollar, we applied for over 250 quotes both online and over the phone from my pool of auto insurance companies from all 50 states. Each member of the team used personal information during the quote process to ensure that we could see who was consistently cheapest across the country with a handful of scenarios. What did remain the same, however, was the amount coverage we applied for: each state’s minimum coverage. No frills, no extras; just the absolute minimum coverage to legally drive on the road.
Next, I tallied and compared how many times each company had the first, second, or third cheapest yearly premium. I awarded five points for first place, three points for second place, and one point for third place.
As it turns out, the cheap car insurance market is dominated by three main providers: GEICO, State Farm, and Progressive. (The other 25 insurers didn’t even score high enough to register in my test.) And, as you can see below, GEICO was the overwhelming victor.
|Insurer||# of 1st Place Awards||# of 2nd Place Awards||# of 3rd Place Awards||Total Score|
GEICO was the cheapest option in 19 of the 50 states. It was also one of the three most affordable options 75 percent of the time, and its best offer was often hundreds of dollars cheaper than the next-best competitor. Take these annual quotes for New York, Pennsylvania, and Washington for example.
|GEICO: $329||GEICO: $225||GEICO: $623|
|Allstate: $538||State Farm: $394||Allstate: $898|
*Note: Occasionally, the reason GEICO was able to beat its competition by such a large margin was because the other insurers required slightly more coverage than the state mandated.
The gecko-loving company is without a doubt the most consistently affordable option out there, so it deserves a shopper’s consideration. And, it’s true, according to my research, it is safe to say that 15 minutes could often save you “15 percent or more” on a state-minimum policy. However, its range of coverages and discounts don’t particularly shine when compared to a competitor like Allstate. Allstate customers enjoy prepay discounts, low-mileage discounts, interior vehicle coverage, and new car replacement — all of which are not offered at GEICO.
When it comes to customer service ratings, GEICO doesn’t have anything to write home about. (It fell just under the industry average according to JD Power.) But, if you’re dead-set on purchasing the least amount of insurance that you possibly need, then GEICO is your best bet.
State Farm had a lower overall score than GEICO, but wound up in the top three a total of 38 times (GEICO only placed 37 times). When State Farm placed, it usually fell between $30 to $50 dollars of the competition. Though, it occasionally would surprise me with a GEICO-like rate. The two best examples of this are Minnesota and South Carolina. In Minnesota, State Farm was $120 cheaper than American Family, and in South Carolina it beat GEICO by a whopping $223.
Quotes aside, State Farm is the nation’s largest auto insurer. It ranks consistently well for customer satisfaction and rates above average in most of the regions of the J.D. Power survey. It also earns A.M. Best’s top marks (A++) for financial strength. All that’s to say it is a great choice if you can spare a few extra dollars each month. Plus, it has the best tools of any auto insurance provider out there, including mobile bill pay, mobile claim filing, and a pay-by-bank account option.
Progressive only placed 1st in seven states, and when it did, it was usually less than $20 ahead of the runner-up (which was usually GEICO). That doesn’t mean Progressive is never a viable option, though. Consider the state of Montana, where Progressive came in $22 cheaper for the year. So for less than $2 more each month, a Montana driver could take advantage of mobile claims filing, loyalty discounts, prepay discounts, and low-mileage discounts that GEICO doesn’t offer.
Where to Find Car Insurance Discounts
Once you’ve seen some quotes, you need to master discounts — the key to cheap car insurance rates. Many insurers have a wide variety of overlooked deductions that go beyond bundling or insuring multiple vehicles, and some of them are less obvious than you may think.
Driving education is a discount opportunity many don’t know exist. Drivers who pass an accredited driver’s ed class or defensive driving training are eligible for a sizeable price reduction. The amount of this discount isn’t standardized across the nation or with insurers, but according to DriversEd.com, some drivers might welcome as much as a 10% decrease in their bill. Plus, if you’ve recently received a ticket, enrolling in a defensive driving course can prevent the premium hike on your insurance (most companies only let you do this once every 12 months).
Defensive driving courses cover topics such as traffic laws, drug- and alcohol-impaired driving, and inclement-weather driving and are often available online or at commercial driving schools. Courses for defensive driving can be found through your local DMV or community center. Most run about six hours long and cost anywhere from $50 to $300 a person.
After completing a defensive driving course, participants will receive a certificate that can be presented to insurance companies to qualify for a discount. Depending on the insurance company, drivers may also have to retake the course and be current on their certification in order to continue receiving the discount.
If you aren’t the only person covered on your auto policy, consider getting all the drivers on your policy — especially teens, as they are expensive to insure — to take a defensive driving course and you will be eligible for additional discounts.
Good Student Discounts
These discounts are typically given to drivers under the age of 25 who are enrolled full time at a high school or college or university and are maintaining at least a 3.0 grade point average (or are on the honor roll or dean’s list).
What about the savings? According to CarInsurance.com, the discount can range anywhere from 5% to 10%, making it one of the most profitable and achievable discounts of all. Consider Travelers, which offers good students up to 8% off.
In order to prove satisfactory academic achievement and receive the discount, students need a current transcript or a letter signed by a school administrator. Students who are homeschooled can present standardized test results, such as their SAT or ACT scores, that are within a desired percentile range in order to qualify. Good grades can continue saving you money after graduation as some insurance companies extend this discount to post-grads for a limited time.
If you’re a student, or the parent of a student, you can learn even more at The Simple Dollar’s student guide to car insurance.
Drivers with a clean driving record — a standard that is determined by each individual insurance provider — are eligible for hefty discounts. Having a squeaky clean record not only gives you a discount opportunity; it can also save you a lot more money in the short term.
There is no universal definition of safe driving, though. Insurance companies generally mean avoiding collisions and accidents for which you can be found at fault, and moving violations such as speeding, driving under the influence, or reckless driving.
Resident student discounts
These discounts can be offered to students attending college more than 100 miles away from home. They are intended to be used exclusively by those students who are not planning to drive the insured vehicle while at school but may use it while they are home for vacations.
Other Discounts to Consider
- Active-duty military and veterans discounts
- Car alarm systems or other safety equipment discounts
- Paid-in-full or prepay discounts
- Occupation and member discounts
- Low mileage discounts
One of the most important things you can do while shopping is to ask the insurance company for a complete list of discounts because not all may be advertised.
Major Car Insurance Types
Though companies offer several more nuanced options and add-ons, the three major types of auto insurance boil down to:
- Liability coverage
- Collision coverage
- Comprehensive coverage
Liability coverage, required by law in most states, covers the other driver’s personal injury and property damage in a crash where you’re found to be at fault. It does not cover your own injuries or property damage. Buying only liability insurance is always going to be your cheapest option, though not necessarily the wisest. (Sometimes it makes sense to carry only liability coverage, and sometimes it doesn’t.)
You’ll probably see your liability coverage written like this on your quote or car insurance policy: $50,000/$100,000/$50,000 (or 50/100/50). That means you have $50,000 in bodily injury coverage for each person, $100,000 in bodily injury coverage total, and $50,000 in coverage for property damage. Each state requires its own minimum amount of liability insurance.
Buying the bare minimum is tempting since it will keep your rates as low as possible. Unfortunately, that’s a bad idea — a bad crash can mean your costs will easily surpass low state minimums, and then you’ll have to pay up. In North Carolina for example, its minimum for bodily injury is $30,000, but the average cost of a non-fatal disabling auto-wreck injury is over $60,000. If you only have the state’s minimum coverage, you could wind up paying over $30,000 out of pocket. And if you don’t have that kind of money laying around, your other assets become vulnerable.
Collision coverage covers the damage to your car sustained in a crash. This most commonly covers accidents when you’re found to be at fault, but it may also pay in certain circumstances when another driver is at fault, or in scenarios not covered under your other policies.
The cost of your collision coverage will largely depend on your car’s value, but you do control the deductible — the amount you pay out of pocket before your insurance company picks up the rest of the tab.
True to its name, comprehensive car insurance covers almost any car-related calamity you can think of minus damage resulting from a crash. Instead, comprehensive policies pay for things like auto theft, damage from severe weather, or needed repairs after a late-night rendezvous with a disoriented deer.
Comprehensive coverage is meant to complement collision coverage, not replace it. Like collision coverage, the cost will depend on your car, but you control your deductible.
What types of car insurance do I really need?
Comprehensive and collision coverage seem like a smart choice, but they come with a much heftier price tag than liability-only insurance. If you took out a loan to pay for your car, you probably don’t have a choice — your lender will require proof of comprehensive and collision coverage. Dropping this coverage usually isn’t a good idea for anyone without the savings to pay for repairs out of pocket.
But, there are situations when opting only for liability makes sense. For instance, if you drive an older, paid-off vehicle that you can easily fix or replace, keeping only liability coverage can mean significant savings. Comprehensive and collision coverage may also be overkill on any car you drive sparingly.
To see how much I would save on auto insurance by nixing all coverage but liability, I plugged a few stats into a quote generator. I used the persona of a married male in his early 30s driving a paid-off 2011 Hyundai Sonata. I said he lives in a small Southern city, has a clean driving record, and averages 12,000 miles a year. A policy with 50/100/50 in liability, as well as comprehensive and collision policies with $250 deductibles, would set him back $45 a month. Dropping the comprehensive and collision policies would bring my bill down to just $24 a month — almost half the the cost.
Would I personally drop my comprehensive and collision policies? No, because my 2013 Jeep Patriot is still relatively new and would cost a significant sum to repair or replace. My brother, however, drives a 1984 Ford F150. At best, it’s worth around $3,000 — and his policy is only $19 a month! For him, dropping comprehensive and collision coverage made a lot more sense.
The bottom line: Liability coverage is your cheapest option and meets the legal requirement, but dropping collision and comprehensive coverage might be a risky move if it would be a major financial hardship to fix or replace your car after an accident.
Add-Ons and Other Types of Coverages
There are a number of other coverage types and add-ons, some of which may be required in certain states. Of particular note is personal injury protection, which pays your medical expenses after a crash.
If you’re trying to keep your bill low, personal injury coverage probably isn’t a smart buy as long as you have a good health insurance plan — there would be too much overlap between the two policies.
There are also uninsured and underinsured motorist coverages, which get you off the hook after a crash where the other driver is at fault but doesn’t carry enough (or any) insurance and can’t afford to pay. Other add-ons pay for rental cars while your car is being fixed and for roadside assistance.
As for other little add-ons, consider skipping them. If you can cover the cost of a rental (or borrow a car from a friend while you’re in a jam), rental-car riders are unnecessary, and a AAA membership is often a better deal than roadside assistance coverage if you have an older vehicle.
What car insurance is required in my state?
Each state has different requirements when it comes to car insurance. Many simply require liability insurance (both bodily injury and property damage). Others go a step or two further, requiring add-ons such as personal injury protection and uninsured or underinsured motorist coverage. Visit the table below and locate your state to find your state’s requirements.
According to the Insurance Information Institute, here are the kinds of insurance each state requires as of September 2015, as well as the minimum required amounts of liability insurance. The only state that does not require liability insurance is New Hampshire; however, that state still mandates that you show you have sufficient funds to meet state requirements if you’re at fault in a crash.
|Types of insurance required||Minimum required liability insurance|
|Alabama||Bodily injury liability, property damage liability||25/50/25|
|Alaska||Bodily injury liability, property damage liability||50/100/25|
|Arizona||Bodily injury liability, property damage liability||15/30/10|
|Arkansas||Bodily injury liability, property damage liability, personal injury protection||25/50/25|
|California||Bodily injury liability, property damage liability||15/30/5|
|Colorado||Bodily injury liability, property damage liability||25/50/15|
|Connecticut||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||20/40/10|
|Delaware||Bodily injury liability, property damage liability, personal injury protection||15/30/10|
|District of Columbia||Bodily injury liability, property damage liability, personal injury protection, uninsured motorist||25/50/10|
|Florida||Property damage liability, personal injury protection||10/20/10|
|Georgia||Bodily injury liability, property damage liability||25/50/25|
|Hawaii||Bodily injury liability, property damage liability, personal injury protection||20/40/10|
|Idaho||Bodily injury liability, property damage liability||25/50/15|
|Illinois||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/20|
|Indiana||Bodily injury liability, property damage liability||25/50/10|
|Iowa||Bodily injury liability, property damage liability||20/40/15|
|Kansas||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/10|
|Kentucky||Bodily injury liability, property damage liability, personal injury protection||25/50/10|
|Louisiana||Bodily injury liability, property damage liability||15/30/25|
|Maine||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist, medical payments||50/100/25|
|Maryland||Bodily injury liability, property damage liability, personal injury protection, uninsured motorist, underinsured motorist||30/60/15|
|Massachusetts||Bodily injury liability, property damage liability, personal injury protection, uninsured motorist, underinsured motorist||20/40/5|
|Michigan||Bodily injury liability, property damage liability, personal injury protection||20/40/10|
|Minnesota||Bodily injury liability, property damage liability, personal injury protection, uninsured motorist, underinsured motorist||30/60/10|
|Mississippi||Bodily injury liability, property damage liability||25/50/25|
|Missouri||Bodily injury liability, property damage liability, uninsured motorist||25/50/10|
|Montana||Bodily injury liability, property damage liability||25/50/10|
|Nebraska||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/25|
|Nevada||Bodily injury liability, property damage liability||15/30/10|
|New Hampshire||Uninsured motorist, underinsured motorist, medical payments||25/50/25 (minimum available in NH, but not required by state law if you show sufficient funds)|
|New Mexico||Bodily injury liability, property damage liability||25/50/10|
|New York||Bodily injury liability, property damage liability, personal injury protection, uninsured motorist,wrongful death||25/50/10|
|North Carolina||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||30/60/25|
|Ohio||Bodily injury liability, property damage liability||25/50/25|
|Oklahoma||Bodily injury liability, property damage liability||25/50/25|
|Pennsylvania||Bodily injury liability, property damage liability, personal injury protection||15/30/5|
|Rhode Island||Bodily injury liability, property damage liability||25/50/25|
|South Carolina||Bodily injury liability, property damage liability, uninsured motorist||25/50/25|
|South Dakota||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/25|
|Tennessee||Bodily injury liability, property damage liability||25/50/15|
|Texas||Bodily injury liability, property damage liability||30/60/25|
|Utah||Bodily injury liability, property damage liability, personal injury protection||25/65/15|
|Vermont||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/10|
|Virginia||Bodily injury liability, property damage liability, uninsured motorist, underinsured motorist||25/50/20|
|Washington||Bodily injury liability, property damage liability||25/50/10|
|West Virginia||Bodily injury liability, property damage liability, uninsured motorist||25/40/10|
|Wisconsin||Bodily injury liability, property damage liability, uninsured motorist||25/50/10|
|Wyoming||Bodily injury liability, property damage liability||25/50/20|
Six Tips to Find Cheap Auto Insurance
Certain factors that affect your car insurance rates are largely beyond your control. These include basic demographics such as your age, gender, marital status, location, and job.
But other factors, including what and how you drive, are easier to change. So, comparison shop, exploit discounts, and consider bundling policies to find the cheapest car insurance companies, too.
It’s a no-brainer, but it always pays to shop around for cheaper car insurance. Instead of wasting time making endless phone calls or filling out the same information on dozens of websites, save time by using an online quote tool. Online quote tools help you get a quick snapshot of potential rates from several auto-insurance companies at once.
More importantly, getting multiple auto insurance quotes helps you avoid becoming a victim to something called price optimization. Price optimization is the devious practice of of establishing rates based upon how much insurance companies think customers are comfortable paying.
Earnix, a pricing analytics platform, found that 45% of larger insurance companies use this tactic to maximize their profits. These insurers mine and analyze a ton of personal data, like credit scores and web shopping habits, to determine how likely you are to leave them for another auto insurance company. The bottom line is this: Auto insurance companies are going to charge you based upon how much money they believe they can comfortably squeeze from your pocket, not who you are as a driver.
Getting new quotes on the regular is the best way to avoid price optimization because, just like other personal data, insurers can see how often you shop around. The more you do it, the less likely they are to risk upping your premium and lose you as a customer.
Search Affordable Car Insurance Options Near You
Enter your zip code below and be sure to click at least 2-3 companies to find the very best rate.
Many car insurance companies will give you a discount if you have other policies with them. For instance, you may get a break on car insurance if you use the same provider for life, home, or renter’s policies. Bundled policies are convenient, too; you’ll be dealing with only one bill and one company.
A note of caution: Don’t automatically assume bundles will save you money. Companies that offer only auto insurance may offer compelling discounts to keep your business. Sometimes that means you get cheaper car insurance if you keep policies with separate insurers.
Boost Your Deductible
Your deductible is what you pay out of pocket before your insurance covers the rest of the cost to fix or replace your car. A plan with a $250 deductible will generally cost more than one with a $1,000 deductible.
For a real-world example, I plugged my mock persona into a quote generator from Progressive, changing only the deductible to see how it would affect my rate. As mentioned earlier, I used a married male in his early 30s driving a 2011 Hyundai Sonata. He lives in a small Southern city, has a clean driving record, and averages 12,000 miles a year.
With a $100 deductible on comprehensive and collision coverage, he would pay roughly $120 a month. Raising that deductible to $250 brought the bill down to about $100 a month. A $500 deductible reduced the monthly bill to $90, and a $1,000 deductible pushed it all the way down to $82. That means he could save $456 a year by choosing the $1,000 deductible instead of the $100 deductible — not a bad sum.
However, raising your deductible is only a good move if you have cash stashed away to pay the higher deductible in case of a crash or other calamity. Also keep in mind that factors such as your age and driving record will affect how much raising your deductible will actually save you.
Drive a Low-Risk Car
Luxury cars are always the most expensive to insure. These cars have the power to go extremely fast, and insurance companies know their drivers are more likely to get into trouble. These cars also cost a lot more to fix and are attractive targets for thieves — all situations your insurance company wants to avoid.
The most expensive 2015 car to insure, the 600-horsepower Nissan GT-R Nismo, will set you back about $3,574 a year in car insurance, according to Insure.com. Right behind it are a slew of high-powered or luxury rides including the Mercedes-Benz SL65 AMG Convertible, Dodge SRT Viper, Porsche 911 Carrera S Cabriolet, and Audi R8 5.2 Spyder Quattro, all of which still top $3,000 a year.
If you don’t have six figures to drop on a car, here’s some good news: Family-friendly vehicles including minivans, sedans, and smaller SUVs cost the least to insure. Their drivers tend to be more careful, ultimately filing fewer claims. These vehicles are simpler to fix and they aren’t quite as tempting for thieves.
The cheapest car to insure, the Jeep Wrangler Sport, will set you back only about $1,134 a year in premiums. The Jeep Patriot Sport, Honda CR-V LX, Dodge Journey SXT, and Honda Odyssey EX-L are similarly easy on the wallet.
Ultimately, the choice is yours, but a less-glamorous ride can help you nab cheap auto insurance.
Change Your Driving Habits
Insurance is all about risk. If you get a speeding ticket every month, your bill will skyrocket. If you’ve had a clean driving record for years, you will have cheaper car insurance. Unfortunately, cleaning up a spotty driving record can take time.
Driving less is the simplest, easiest way to change your driving habits. Consider your options carefully: Can you carpool? Work from home? Use mass transit or even move closer to your job? All of these options can help you save since less time behind the wheel means less chance of a claim. Be sure to tell your insurer about your new habits.
Maintain Good Credit
It may seem unfair, but the vast majority of car insurance companies look at your credit score to help determine your rate. If you have good credit, your insurer assumes you’ll be more responsible behind the wheel. Bad credit means you’re statistically more likely to file a claim, insurers say.
According to consumer advocacy group United Policyholders, a rock-bottom credit score could mean you’ll pay double, triple, or even quadruple over someone with a perfect credit score. This controversial practice is illegal in four states: California, Hawaii, Maryland, and Massachusetts. If you don’t live in those states, you’ll want to work on your credit score in your quest for cheap auto insurance.
It’s Time to Save on Car Insurance
A little legwork now can save you big in the long run, so remember to re-evaluate your car insurance at least annually. Your own changing circumstances and old-fashioned competition between insurers always has the potential to hook you a cheap car insurance policy.
Search Affordable Car Insurance Options Near You
Enter your zip code below and be sure to click at least 2-3 companies to find the very best rate.
How much is car insurance for a 16-year-old?
Newly licensed drivers are expensive to insure. They are inexperienced, naturally, and have a high rate of accidents, so insurers consider them to be high-risk drivers. The average car insurance rate for a 16-year-old who has his or her own policy is $5,473 per year, on average. What you pay will vary, depending on your insurer, whether or not the teen is added to a parent's policy, the state you live in, the type of car you drive and coverage limits. To give you an idea of what to expect to pay for coverage, we provide average annual rates by state in the charts below.
The rates for a separate teen policy are based on having the following coverage limits on a 2015 Honda Accord, along with any other state required coverages, and a deductible of $500:
- $100,000 for injury liability for one person
- $300,000 for all injuries in one accident
- $100,000 for property damage
For the cost to add a teen, CarInsurance.com compared rates in 10 zip codes in each state. The family profile we used owned a 2014 Honda Accord driven by a 40-year old man buying full coverage. Then we added a 16-year old teen to the policy. You'll see that adding a teen is much less expensive. That's because when teens get their own policy, they qualify for few discounts compared to their parents. Also, teens are commonly listed as a secondary driver on parents' policies.
Car insurance for a 16-year-old female
|State||Teen policy rate||Parents' policy||Parents' policy with teen added|
|District of Columbia||$7,071||$1,628||$3,085|
Car insurance for a 16-year-old male
|State||Teen policy rate||Parents' policy||Parents' policy with teen added|
|District of Columbia||$8,715||$1,628||$3,969|
Cheap car insurance for a 16-year-old
Each state has minimum car insurance requirements that you must have to drive legally. This level of coverage is typically the cheapest, but it also provides limited protection. In most states, buying just the required coverage means your insurance will pay for others’ injuries and car damage, but not for your own injuries or car repairs. You’ll see in the charts below how much minimum coverage costs, on average, per year in each state, for a teen buying his or her own policy.
Cheap car insurance for a 16-year-old girl
|State||Average minimum rate|
|District of Columbia||$3,120|
Cheap car insurance for a 16-year-old boy
|State||Average minimum rate|
|District of Columbia||$3,724|
*CarInsurance.com commissioned Quadrant Information Services to run auto insurance rates for a 2015 Honda Accord LX for 10 ZIP codes in each state using six large carriers -- Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm. (In cases where one of the insurers doesn't return a rate, another major carrier in that state is substituted.)
Can a 16-year-old own and insure a car?
Penny Gusner, the consumer analyst for CarInsurance.com who is available to answer your car insurance questions, says that in most states a 16-year-old can own a car and insure it -- but only if a parent or legal guardian co-signs for both the vehicle's title and insurance coverage. "Even if you're under the age of majority, which is 18 in most states, you can buy and insure a car," Gusner explains. "However, in general, minors cannot enter into a contract, so they cannot sign for auto insurance by themselves. Depending on state laws, a teen may not be able to buy a car either, since that is a sales contract, without an adult signing on as well." While most states consider 16 to be a legal age to own a car, there are exceptions. Gusner points out that a juvenile must be 17 in South Carolina to buy a vehicle, again with a parent or guardian signing on. She also notes that Ohio requires a parent to file a minor consent form with the state's bureau of motor vehicles if anyone under 18 wants title to a vehicle.
Adding a teen to parents’ policy is usually more affordable
When it comes to car insurance for young drivers, most parents take the easier, and far more common, approach of adding a teen to their policy. For one thing, it's likely to be cheaper. Insurers base premiums on several factors, including the experience and driving record of the policy holder. A 16-year-old won't have that, which means higher rates. Also, as Gusner points out, the teen won't be eligible for rate reductions the parent may qualify for, including multi-vehicle, multi-policy (where car and home policies are bundled) and loyalty discounts. Still, adding a 16-year-old driver to your policy still means a significant hike in your rates. Every situation is different, but to get a an idea of what you can expect to pay, CarInsurance.com compared rates in 10 zip codes in each state. The family profile we used owned a 2014 Honda Accord driven by a 40-year old man buying full coverage. Then we added a 16-year old teen to the policy. Here's what happened:
- The average household's car insurance bill rose 152 percent.
- A teenage boy was more expensive. The average bill rose 176 percent, compared with 129 percent for teenage girls.
Despite the high cost to insure a teen, comparing car insurance quotes will save you money. Each insurer uses its own method for calculating what you pay, so prices for the same policy can vary significantly. For example, when adding a 16-year-old girl to your policy in Sacramento, California ZIP 95829, you can save $4,706 by comparing rates. That’s the difference between the highest ($7,267) and the lowest ($2,559) rates among six insurers for the same neighborhood.
Insurance for teen drivers
So, when do you add a teen to your policy? Start the process when he or she has a learner's permit. "Yes, begin when your child is first permitted to practice driving by contacting your insurer to see if you need to add the teen now or when fully licensed," she says. Gusner says the only time it might be wise to get teens a separate policy is when they've had some moving violations or been in accidents, which would hike premiums on the family coverage. Instead, think about getting a teen an older car, which is cheaper to insure, and buying a separate policy with only high liability protection." And don't forget to shop around," Gusner adds. "The teen's policy premium could be lower from one insurer to another." Also keep in mind that the high cost of insuring a young driver won’t last forever. Average car insurance rates by age show that rates begin to significantly decrease when drivers hit age 26.
Do you need insurance to drive with a learner’s permit?
Gusner says a novice driver does need to be insured, but not under his or her own policy. Usually, the policy of the vehicle's owner (typically the parent or guardian who accompanies the teen while he or she learns) should be enough. But parents need to immediately add their teen drivers to their policies once the teens are licensed." Most insurers will wait until the teen is licensed to make you add him, but do check beforehand because some will make you add the child at that point (when he has a permit) and start paying for him as a driver," she says.
Do you need insurance to get a license?
If you're driving, most states require you have minimum liability insurance. But a 16-year-old hoping to get his first license only has to show that the car he'll be driving is already covered by its owner's policy.
What's the best insurance for teenage drivers?
When insuring your 16-year-old, Gusner says first focus on liability protection, which pays for damages your teen may cause to property or people in an accident. And don't think that state-minimum coverage is enough. Medical costs can quickly escalate if there are major physical injuries. Bills can also go sky-high with property damages. Just imagine the costs if the accident involves a very expensive vehicle or other significant property. You'd have to pay out-of-pocket once those costs exceeded your liability limits. Besides raising your basic liability amount, consider purchasing an umbrella policy, which raises liability protection after those basic limits are met. An umbrella with $1 million or more of protection may be a smart move. If the vehicle is being financed, then comprehensive and collision coverage is required. But you decide if you want these optional protections if the car is already paid for. If you opt for comprehensive and collision, consider higher deductibles to lower your rate. Of course, you'd then have to pay for minor repairs following an accident.
Car insurance discounts for 16-year-olds
Despite the high rates you pay for young drivers, there are ways to trim costs. Car insurance discounts for teen drivers vary by state and insurer, but may include:
- Driver education: Completion of a driver education course, if not required under state law as part of the licensing process, may provide a 5 percent discount.
- Good student: Drivers who maintain a 3.0 or “B” average may get a discount of up to 15 percent.
- Parent-teen driving contract: Teens who sign a contract with their parents that outlines rules to follow when driving – for instance limited hours and numbers of passengers – may get up to a 5 percent discount.
What are the best cars for a 16-year-old?
There are many things to consider, with safety the most important. The Insurance Institute for Highway Safety (IIHS) offers some basic principles when buying a car for a teen:
- Try to get Electronic Stability Control (ESC). This feature, which helps a driver maintain control on curves and slippery roads, is about as good at reducing risks as safety belts, says the IIHS
- Avoid very high horsepower. "Vehicles with more powerful engines can tempt (young drivers) to test the limits," says the IIHS.
- Look for cars with the best safety reviews from the IIHS and National Highway Traffic Safety Administration.
CarInsurance.com offers its own buying suggestions, including a detailed list of the cheapest cars to insure for teen drivers, models under $15,000 with good safety ratings.
Dangerous times for 16-year-old drivers
Safety becomes even more profound when you realize how perilous our highways can be for teenagers. Here are a few sobering facts:
- A 16-year-old is 20 times more likely to be killed in a crash than an adult, according to the California Office of Traffic Safety.
- One in five 16-year-old drivers has an accident during the first year of driving, according to a study by Geico.
- 16-year-olds have higher crash rates than drivers of any other age, according to a study by the Children's Hospital of Wisconsin.
En Español: Las tarifas de seguro automotor por estado
Michigan comes out on top for the third year in a row in a contest that no state wants to win: the most expensive car insurance rates in the nation. Insure.com’s 2016 state-by-state comparison of auto insurance premiums found that the Great Lakes State is still the most expensive state in the country to insure a car.
Michigan has been in the No. 1 or No. 2 spot for the six years that Insure.com has commissioned the annual report. Montana captured the No. 2 spot for the second year in a row. New Jersey broke into the top five for the first time ever, Louisiana was No. 4, and Oklahoma rounded out the top five.
On the flipside of the cost coin, Maine grabbed the No. 1 spot for the cheapest car insurance in the country. Maine has been in the top three for the least expensive car insurance for all six years of the study. This year, Ohio came in No. 2, Wisconsin was three, Idaho took fourth, and New Hampshire earned No. 5.
Use the interactive map below and hover over any state to display the average annual rate, comparison to national average, and the percent of change from last year.
This year’s best-selling vehicles
The annual study compiles rates from six large insurance carriers in 10 ZIP codes in every state. Rates were for the same full-coverage policy for the same driver -- a 40-year-old man with a clean driving record and good credit.
The rates are an average for the 20 best-selling vehicles in the U.S. in order to present more accurate rates for the average driver – without high-end sports or luxury cars skewing the data. Each model was rated on its cheapest-to-insure trim level. This year’s 20 best-selling vehicles list included:
- Ford F-150 XL SFE
- Ford Fusion S
- Ford Escape S
- Ford Explorer XLT
- Chevrolet Silverado 1500 LT
- Chevrolet Malibu LS
- Dodge Ram 1500 Tradesman
- Toyota Camry LE
- Toyota Corolla L
- Toyota RAV4 LE
- Honda Civic LX
- Honda Accord LX
- Honda CR-V LX
- Chevrolet Equinox LS
- Nissan Altima 2.5 S
- Nissan Rogue S
- Nissan Sentra S
- Hyundai Sonata SE
- GMC Sierra 1500
- Jeep Cherokee Sport
The national average for a full-coverage policy as featured in the Insure.com report came in at $1,325 this year – a slight increase from last year’s average of $1,311. Rates varied from a low of $808 a year in Maine to a budget-busting $2,738 in Michigan. Insurance rates in Michigan are more than double (107 percent) the national average.
Insurance rates are influenced by a number of different factors. Everything from traffic, crime rates, state and local laws, the percentage of uninsured drivers, as well as the number of car insurance companies competing in a market can all result in higher, or if you’re lucky, lower insurance premiums in your state.
States with highest car insurance
The reasons behind the highest state rates include everything from Personal Injury Protection (PIP) coverage (a big factor in two of the states) to high fatality rates and litigious-minded drivers.
Here are the top three most expensive states for car insurance and why they are so expensive:
#1 Michigan -- Michigan’s no-fault insurance structure is largely responsible for the high cost of car insurance in the state.
“Michigan auto consumers pay more than most states for car insurance due to the state’s high medical mandate. Michigan is the only state in the country that requires auto consumers to purchase unlimited, lifetime medical benefits as part of the auto insurance policy,” explains Lori Conarton with the Insurance Institute of Michigan.
“Unfortunately, it’s Michigan’s auto insurance consumers who pay the price for this unique auto insurance law,” continues Conarton.
Michigan, like most other no-fault states, requires its drivers to buy personal PIP insurance. PIP coverage will pay the medical bills of the policyholder as well as any passengers and family members that are in the vehicle at the time of the accident.
The big difference is in the amount of PIP coverage that Michigan requires of its drivers. Florida, for example, only requires drivers to carry $10,000 in PIP coverage, while Michigan’s no-fault policies must offer unlimited medical benefits, which pushes the price up dramatically.
Michigan requires insurers to cover medical claims up to $530,000. The nonprofit Michigan Catastrophic Claim Association (MCCA) covers damages above that amount. In addition to high insurance premiums, Michigan drivers must pay an annual assessment to the MCCA, which in 2016 is $150.
The high cost of car insurance pushes many drivers out of the market. According to the Insurance Information Institute (III), an estimated 21 percent of Michigan drivers were uninsured in 2012. High numbers of uninsured drivers raise rates because there are fewer drivers (and their premiums) to share the risk pool.
The high cost also leads to – while technically legal – unscrupulous behavior. Some Michigan drivers will purchase a seven-day policy (which insurers in Michigan sell) so they have proof of insurance when registering their vehicle and then let the policy expire after a week, leaving them uninsured.
Unfortunately, rates are probably not coming down anytime soon. Until the PIP requirement is changed or ditched altogether, insurance rates will remain high in Michigan.
#2 Montana -- Montana stayed in the No. 2 spot for the second year in a row with an average premium of $2,297, which is 73 percent higher than the national average and a whopping $411 increase over last year’s Insure.com Montana average.
There are a number of factors that increase rates in Big Sky country, but one of the biggest is the accident rate. Wide-open spaces and lonely roads lead to a lot of car accidents and fatalities. According to the Insurance Institute for Highway Safety, Montana has the highest vehicle accident fatality rate in the country with 22.6 deaths per 100,000 people – twice the national average.
#3 New Jersey --The Garden State makes the top five for the first time. The average premium in New Jersey came in at $1,905, which is 44 percent higher than the national average.
According to Kacy Campion Renna, vice president of the Professional Insurance Agents of New Jersey, high accident rates may have something to do with New Jersey’s costly insurance. “New Jersey ranks No. 1 when it comes to population density, which means there’s a greater chance of having an auto incident here.”
Renna also cites other factors that can impact rates in New Jersey. “Other factors to consider are high medical costs, high rates of auto and medical fraud combined with the fact that the New Jersey residents tend to be pretty litigious.”
Fraud has become a fact in New Jersey’s PIP coverage. New Jersey allows PIP coverage levels up to $250,000, which is the second highest in the country, behind Michigan. Unfortunately, PIP fraud has shot up which raises the cost of insurance for everyone in the state.
States with the cheapest car insurance
The low cost of car insurance in the least expensive insurance premium states can be attributed to a number of factors, including fierce insurer competition and low numbers of uninsured drivers.
#49 Wisconsin – The Badger State is No. 3 when it comes to inexpensive insurance. A yearly premium of $912 makes car insurance a bargain in Wisconsin. Wisconsin benefits from a pretty rural environment and a very competitive insurance market. A lack of major cities helps keep accident rates down.
According to numbers from Highway Loss Data Institute (HLDI), Wisconsin has 1 death per 100 million vehicle miles traveled in 2013. Montana, the second-most expensive state on the list, recorded 1.96, which was the highest on the list in the same year.
In addition, Wisconsin residents are not particularly litigious, which makes insurance companies happy and leads to lower rates across the state.
#50 Ohio – With an average annual premium of $899, Ohio is No. 2 for affordable car insurance for the second year in a row, and the state has spent quite a bit of time in the top five over the last six years.
“Ohio is home to many national and regional insurers because of its stable legal and regulatory environment. This creates a competitive marketplace for consumers, leading to great rates and a variety of products and services from which to choose,” explains Perk Reichley, President of Reichley Insurance Agency.
According to the Ohio Insurance Institute, there are currently more than 650 insurance carriers writing policies in the state. Compare that number to the approximately 134 in California and just over 40 in New Jersey, and it’s plain to see how competition has positively affected the rates.
#51 Maine – Maine has hit the No. 1 spot for two years running, and it’s finished in the top three every year of the Insure.com study. The average premium came in at $807 per year, which was a tiny $2 increase over last year.
Maine is a convergence of favorable factors; they have very few large urban areas so traffic is usually not a problem, which in turn keeps down accident rates. In addition, though Maine gets a lot of snow, the state doesn’t usually suffer from major weather incidents like tornadoes and hailstorms, which can do serious and expensive damage to a car.
Maine drivers take their insurance responsibility seriously with a mere 4.7 percent of uninsured drivers, according to the Insurance Information Institute. This makes them No. 2 in the country for uninsured drivers with only Massachusetts beating them out. When everyone is insured, prices go down.
Providing real cost estimates
The Insure.com study differs from other studies, such as the National Association of Insurance Commissioners (NAIC) rankings, in that it compares how much it would cost a driver to buy the same coverage in each state. The NAIC rankings calculate the average amount drivers spend on auto insurance -- regardless of what coverages and levels of coverage are purchased.
How much does car insurance cost?
It’s important to remember that these numbers are averages and will not reflect your actual policy price. Insurance prices are highly personalized, and many factors will affect your rates, including the type of vehicle you drive, the coverages you choose to carry, your specific neighborhood and, in certain states, even your credit rating.
Insure.com’s study of the most and least expensive vehicles for 2016 includes easy-to use tool for viewing nationwide car insurance rates for 2016 vehicles or looking at state specific average rates, and allows you to compare up to 10 vehicles at once.
Shop your coverage annually to make sure you are getting the best car insurance rates available, ask for discounts and consider bundling your coverages to save money.
Average cost of car insurance by state
AL AK AZ AR CA CO CT DC DE FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY More than $100 below national averageWithin $100 of national averageMore than $100 above national average
See Insure.com's Best Car Insurance Companies
Insure.com commissioned Quadrant Information Services to calculate auto insurance rates from six large carriers (Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm) in 10 ZIP codes per state. Rates were compiled in February 2016.
We averaged rates in each state for the cheapest-to-insure 2016 model-year versions of America’s 20 best-selling vehicles and ranked each state by that average. Rates are for comparative purposes only within the same model year.
Rates are based on full coverage for a single, 40-year-old male who commutes 12 miles to work each day, with policy limits of 100/300/50 ($100,000 for injury liability for one person, $300,000 for all injuries and $50,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. The hypothetical driver has a clean record and good credit. The rate includes uninsured motorist coverage. Actual rates will depend on individual driver factors.