As a young adult, you may be trying to balance your budget for the first time. Independence is a topic for drivers from the youngest to the oldest, but there’s no shame in seeking guidance on how to play a role in managing car insurance budgets.
To guarantee prices and give you more economical breathing room, Bankrate’s editorial team compiled a list of national averages for drivers 20 years old-up to 3,320, ranging from $5,464 per year for the same. We’re starting with the premium data available from Quadrant Information Services, but also the J.D. for each operator. Also consider account coverage options, available discounts and professional third-party ratings for Power and AM is best. She was also a key winner of the 2025 Bankrate Award for encouraging young people to pursue different types of mortgages and policy options.
How much is car insurance for young drivers?
Young adults ages 20 to 25 are expected to pay between $3,320 and $5,464 per year for full auto insurance. The state pays between $982 and $1,659 per year for underserved seniors.
While age and experience in young adults are associated with greater risk, other factors are likely to be controlled for. Sticking to your parents policy is an easy way to reduce car insurance costs for young adults. For example, a 21-year-old with the same annual deductible on their own policy would be $4,539, compared to $3,747 on their parents’ policies. If your primary home was with your parents and the vehicle you are driving is in the garage, you may be eligible for a family policy.
Average Price for Car Insurance for Young Drivers in the State
Location is another important factor in determining car insurance premiums. Every state has different insurance laws, with different coverage requirements, which can vary depending on what each auto insurance company offers. Additionally, accident coverage can vary from place to place, depending on your state, city, or zip code.
How do you determine the price of small drives?
Car insurance rates are set at the same rate as young adult drivers. Factors that affect car insurance premiums include:
Age:
Generally speaking, people over the age of 25 pay more for car insurance because they are more likely to cause accidents than younger people without driving experience. They are also more likely to file claims because they are generally not financially organized by larger drivers. Hawaii and Massachusetts state laws prohibit insurance companies from using age as a rating factor.
Vehicle make and model: Some cars are cheaper to insure than others. Before buying a vehicle, it may be a good idea to check with your insurance company to see if you can get a discount.
Credit:
Most states allow insurance companies to use your credit-based insurance score to calculate the cost of your policy. People with poor credit ratings tend to pay much higher rates than customers with good credit ratings because actuarial data shows that how well a customer manages their finances affects how much insurance they pay. Laws in California, Hawaii, and Massachusetts prohibit the use of credit to determine auto insurance rates. Michigan insurance companies only use your credit information and insurance score to determine payment options and premium payments.
Gender:
Men generally pay more for car insurance than women, even if they have clean driving records. Men are statistically more likely to have accidents than women, and those accidents tend to be more serious. California, Hawaii, Massachusetts, Michigan, North Carolina and Pennsylvania prohibit use on the grounds of sex.
Location:
If you live in an area that is at high risk for disasters and natural disasters, theft or vandalism, you may be less likely to be insured. Additionally, each state has different insurance laws, which can affect the price.
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Mileage:
The more you drive, the more likely you are to have an accident because it’s often on the road. Those who only use their cars occasionally may pay less than those who are frequent on the road.
Car Insurance Discounts for Young Drivers
Almost all auto insurance companies offer coverage, and some specifically offer it to senior drivers. Finding a company to take care of your moving expenses can be a great way to get a little more flexibility.
Multi-Car Discount: Most auto insurance companies offer some discounts when you add multiple vehicles to one policy. This doesn’t completely cover the cost of insuring each vehicle, but it’s usually cheaper to insure the vehicles together.
Multi-Policy Discount: For those who have both apartment rental and car insurance, combining their car and rental insurance can be a way to get a dual-policy discount.
Alumni Association Discount: Many auto insurance companies offer alumni association discounts to recent graduates.
Good Student Discounts: Many companies offer discounts to students who maintain a high GPA or letter average. These student loans are available to all high school and college students and can save hundreds of dollars annually.
Teen Driver Safety Training: Many companies offer supervised learner driver education classes or approved driver training. Most courses cover the rules of the road and teach young drivers how to drive defensively.
Usage-Based Discounts: Usage-based pricing is a relatively new way to lower your car insurance premium. Carriers that use these telematics programs require policyholders to download a mobile app or plug-in device that can track speed, braking, acceleration, and trip details.
Distance Student Discount: Many auto insurance companies offer discounts to students who are away from school during their education. You must be listed on your parent’s policy to use this discount.
Payment Discount: You can use your tech knowledge to pay for your car by filling out several online payment portals. Many providers offer self-payment with discounts, paperless invoicing and fully digital payments.
