Table of Contents
In this chapter, you’ll learn about:
- Affordable car insurance companies
- The importance of insurance history
- The rules of how insurance companies charge premiums
Cheap Auto Insurance Companies for Teens and Young Adults
Let’s say your parents have let you have an older used car, or you’ve finally saved up enough money for your own set of wheels. It’s time for you to strike out on your own, show responsibility, and be a good driver.
Staying safe on the road is of the utmost importance, and auto insurance will help cover the costs of any damage you cause to other vehicles or property. This is why we’re here to help you get the best auto insurance rates for your vehicle.
Even though insurance rates differ from company to company, your best option for saving money is to gather quotes from the companies that appeal to you the most and find out what each company will offer you in terms of discounts, coverage, and price.
GEICO
A lot of people find themselves actually avoiding cars because the insurance policies for youngsters are absolutely outrageous if they’re paying for it themselves. If you want to find out for yourself how cheap carinsurance for young drivers can be, you need to go directly to the insurance company’s website and fill out an online application. In a matter of minutes, you may have discovered how affordable the insurance for young adults is and how competitive the rates are for young drivers … [depending on how your personal situation is].
Once you’ve got the lowdown on the car insurance rates for youthful drivers, you’re going to need to figure out where you’re actually going to purchase it. You’re also going to need to know what else is out there. You can’t just look at one website and pull the trigger. It’s important that you take the time to look at all the different companies and sort out the costs. After all, the one who knows who has the best cheap car insurance for young adults in 2022 is the one who does their research …
Is the best cheap car insurance for young adults in 2022 worth the time it takes?
Esurance
These days, many young adults are making the jump from a parent’s insurance policy to their own. These grown up kids are still looking for cheap car insurance while providing the young driver discounts that are crucial to maintaining a low expense for their new driver. Among the major players, two of the biggest are Esurance and State Farm, and the last one we will be looking at is Axis. So, how do they compare? Well, if you are already a member of one of these carriers, you will need to compare these three policies yourself. If you are not, below you will find a general overview of each company, along with a comparison of each company’s rates. We will discuss the plans and costs for all three companies that we mentioned above. In the end, we will help you come to a general conclusion for which company might be the best fit for you, depending on your needs. Check them out below and then get started on your cheap car insurance for young adults for this year.
Progressive
If you are planning to buy a new car, you must be wondering whether you should go for a new model or a used one. While it’s a great idea to bargain a good deal from the dealer, you can also get a low cost for your car insurance.
One option you have is to go for Progressive insurance. It offers insurance coverage for all levels, types, and classes of cars and drivers. It also offers different levels of coverage, including comprehensive, collision, and liability coverage.
Young learners, college students, teen drivers, and young professionals are eligible to avail its services.
Comprehensive Coverage
This is the standard level of automobile coverage. It protects you from the financial loss that you might incur in case of theft, damage, mechanical breakdown, and vandalism.
Collision Coverage
This coverage protects you from physical damage that occurs as a result of a crash. If the car that you’re driving is wrecked due to an accident, this collision coverage will help in replacing the damaged parts.
Liability Coverage
This coverage provides protection to the occupants of your car and third parties. Even if you are not at fault, you will receive financial aid to repair your car when in an accident.
USAA
USAA is a property and casualty insurance company that has a very special relationship with the military. It started as a banking and mortgage lender in San Antonio and now provides banking and insurance products for nearly 12 million customers.
It’s a very different company from what you’re probably used to. Membership requires a military affiliation or a family relationship with someone who’s serving in the military. It operates in a few states and serves active members of the Army, Navy, Air Force, Marines, Coast Guard and National Guard.
So What’s the Car Insurance Situation Like in the U.S?
Car insurance in the U.S. is not like anywhere else in the world. All European countries, Canada, and Australia have what’s called third-party insurance, where the insurance company is responsible for the vehicle damage where the at-fault driver is not part of their policy.
In the U.S., even if you’ve got comprehensive insurance coverage, you can be held financially responsible for a car accident if you’re deemed at-fault. (Note that there are certain situations when you are not responsible, such as an accident caused by a hit-and-run driver. However, that’s a whole different story).
Liberty Mutual
Vs. Progressive vs. State Farm
Liberty Mutual vs. Progressive vs. State Farm
In the past several years, cheap car insurance for young adults have become increasingly more difficult to find and manage. Whether it’s due to corporate greed or the unfortunate changing climate of our society, car insurance is a lot more complicated than it used to be.
State Farm
State Farm is likely to remain the cheapest auto insurance provider for young drivers, according to reviews. That’s because it has rates that are significantly cheaper than its competitors.
The company offers exclusive discounts as well. In fact, it has a special Young Driver discount that allows a policyholder’s teenage children to drive the family vehicle under the supervision of an adult.
As with other top insurance providers, State Farm has a young driver program designed to ease a teen’s transition from a mid-size vehicle to a full-size one and from an inexperienced driver to a more seasoned one.
Once a teen has completed a full year of driving safely, State Farm will reduce the premium the next year.
To make insurance premiums affordable, State Farm will also reduce the driver’s deductible once he or she completes a few years of accident-free driving. This helps young drivers to be less scared of paying a significant deductible if they have an accident.
Allstate
Looking for a company that won’t put a hit on your wallet? Allstate is likely your best bet. This company has an A+ rating with A.M. Best, a financial services company that analyzes the financial condition of insurance companies. That’s good news, since you want to make sure your insurer can pay up if you’re involved in an accident. Allstate gets top marks for things like financial stability, customer satisfaction, and claims handling.
However, like all other insurers, Allstate doesn’t sell directly to consumers. Allstate requires that you go through an agent to purchase a policy. That’s fine if you have an Allstate agent with whom you already have an existing relationship, or if you choose to purchase the insurance through the agent; it’s not so good if you don’t. Agents are usually on commission, which means the more products you buy, the more the agent makes. So it’s hard to know whether an agent’s recommendations will be in your best interests. But if you’d like to see how the agent compares, you can check out A.M. Best‘s rating of your Allstate agent.
Nationwide
I think you will be pleasantly surprised to discover that nationwide’s auto insurance rates for young adults are some of the lowest in the industry. This is a very good thing to know before you start shopping around for the best cheap car insurance for young adults.
Of course, you’ll have to check their rates out, but nationwide has a very good reputation. They offer fair rates and excellent customer service. Though relatively new to the insurance industry, they’ve really stepped up to the plate and given some of the longstanding insurance companies a run for their money.
As for their rates, nationwide uses a “state average” to set the price of their auto insurance plan. This means that, based on the average number of claims a year, the insurance company comes up with a state average. Then the insurance plan reflects the average of the state as a whole. This is different from other insurance companies that use information like age, driving experience and location to determine the price of the auto insurance premiums.
Nationwide doesn’t use driving records, which makes getting the cheap car insurance for young adults much easier. If you’re just starting out in the driving world, you’ll be glad to know that this will be much less of a factor in determining your premium rates.
Amica
Amica has one of the most competitive rates we have seen for young drivers. Their rates are especially competitive if you are an excellent driver, have a good credit score and if you add them on your parent’s policy.
They also have a student discount for students who are in college full time during the year. Having an accident or ticket in the last 5 years will raise your premium.
New Hampshire is the same insurance company as Amica. Rates will be just a little bit higher. However, they only offer discounts for students who are in college part-time.
Expect to pay a little bit more with the more congested cities. Overall we think Amica/New Hampshire gives the best overall value in the cheapest car insurance for young adults category.
Even better, they are one of the best for many different types of drivers.
Why Auto Insurance is More Expensive for Young Drivers
Young drivers who want cheap auto insurance will have to do their homework to find the best auto insurance companies and rates. The best deals will be available to drivers with a good driving record—no speeding tickets, no at-fault accidents, no violations.
Auto insurance for young adults will also be less expensive if they can take advantage of high-risk driver discounts. Many insurance companies offer special low rates to drivers who:
- Maintain a good driving record
- Are a member of an auto club
- Have a college affiliation with a local insurance company
- Drive a hybrid car
- Are Christian or Jewish
- Are married
- Are a retired military veteran
Insurance companies also offer reductions for car safety features such as antilock brakes, daytime running lights, child safety seats, and airbags. In some areas, students can also save money by taking an approved driver education course.
What YOU Can Do to Lower Your Auto Insurance Premium
If you're a young driver, one of the things you are undoubtedly familiar with is struggling to get an affordable auto insurance quote.
It's no secret that the premiums charged to younger individuals can be prohibitively expensive, especially if they don't have a good driving history or if the vehicle that they drive is a so-called high risk vehicle category.
On the flipside, every responsible driver knows that it's important to have adequate protection and the best way to do that is to purchase car insurance. In addition, if the primary driver of a vehicle in a household is younger than twenty-five-years-old, you are required to carry liability coverage and your rates will reflect that.
So, with the objective in mind of helping you save money on your car insurance premiums, here are three things you can do right now that will help lower your auto insurance premium costs.
Final Thoughts on Getting the Best Insurance As a Young Driver
About the Author
Michael Kane is a Brooklyn-based web content manager. He’s worked for such leading organizations as Virginia Tech University, General Electric, J. Walter Thompson, and the U.S. State Department. Michael knows a thing or two about writing and a lot about Web publishing, development and SEO.
He has a B.S. in psychology from Virginia Tech University, an M.S.
In international public policy from Georgia State University, and an.
M.S. in information sciences from the University of Michigan.
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