As a new driver, finding affordable car insurance can be exhausting, especially as a young adult. Most insurance companies often consider young adults as high-risk takers; hence, the higher their premiums. So, as someone who’s below the age of 25 and seeking to purchase cheap car insurance, we recommend you go for the best affordable car insurance for new drivers under 25.
This is because these insurance firms provide cheap, yet quality insurance services to their policyholders. To give you a head start and help you make an informed decision, we have provided you with the cheapest car insurance for new drivers. Just stick around as we walk you through it.
Before we take a deep dive, let’s first of all take a glance at the importance of car insurance and certain factors you should consider when purchasing this insurance coverage.
Importance of Car Insurance
The following are the benefits of car insurance:
- Car insurance helps to take care of your medical expenses in the event of an accident
- It helps you repair or replace a vehicle that’s been involved and damaged in an accident
- This insurance helps to pay for your property damage as a result of an accident
- In the case of a lawsuit due to an accident, this insurance helps to protect you
- And lastly, it can provide you with peace of mind.
Factors that Affect the Cost of Car Insurance
Below are some important factors you must put into consideration as a new driver before making a car insurance decision:
Age is a big factor for car insurance companies. Although it does not affect the types of insurance you get, rather, it affects the rate of premium.
Young and inexperienced drivers always face high rates when paying premiums.
2. Driving Records
Another major factor in determining the cost of your car insurance is your driving record. Most times, insurance companies consider your history of accidents, traffic violations, and other driving-related incidents when setting premiums.
You will likely pay a lower premium if you have a clean record of accidents and violations. The longer you go without any violations or accidents, the more likely you are to get a lower rate.
3. Vehicle Type
This can either influence your premium rate positively or negatively. Going for a reliable brand of vehicle reduces your premium rate.
Also, the more expensive your car is, the higher your rate of premium, and vice versa. For instance, flashy and exotic cars attract higher premiums than normal everyday cars.
Where you stay has a huge impact on your insurance. This is because insurance companies consider the area where you live when setting premiums, as different locations have different levels of risk.
For instance, urban areas typically have higher rates than rural areas due to the fact that there is a higher risk of theft and accidents in urban areas.
The above are some important factors you have to consider when making car insurance decisions.
Our research has proved that some life events affect the rate of premium. So, one can ask how life events affect car insurance premium rates. You will get the answers to your questions here in this article.
All you have to do is get a chilled drink and popcorn and relax while we walk you through this well-detailed article.
How Life Events Affect Car Insurance Premium
Below are some ways in which life events affect auto or car insurance premiums:
1. Roommates And Car Insurance
Vehicle insurance firms always want to take note of whether their clients have roommates. They believe that their clients having roommates means extra risk for them.
This is because they are very likely to share their car, and this puts the vehicle at high risk.
2. Renting And Car Insurance
Owning your own home makes you eligible for auto insurance discounts. Not only does it make you less of a risk in the eyes of the insurance company, but it also provides the opportunity for bundling policies.
You’ll benefit from a multi-policy discount if you use the same company for both your homeowners and auto insurance.
This can result in significant savings, even for young people under 25. Insurance companies consider homeowners more financially stable than renters and reward them with lower auto insurance rates.
3. Marriage And Car Insurance
Once you get married, if you haven’t already added your spouse to your policy, call your insurance company and add them.
Updating your status from single to married can significantly lower your premium. also, updating your auto insurance policy with your spouse’s information and switching to just one policy for the two of you also simplifies things.
If you don’t add your spouse as a driver, they can’t drive your vehicle without taking on the risk of driving without insurance.
Okay, we can now talk about the best car insurance for you.
Criteria for Selecting the Best Car Insurance for New Drivers Under 25
Selecting the best affordable car insurance for new drivers under 25 requires a careful evaluation of several key factors.
These criteria have been taken into account to determine the rankings of the following insurance providers:
- Customer Service Rating
20 Best Affordable Car Insurance For New Drivers Under 25
Below is the list of the 20 cheapest car insurance for new drivers under 25:
- State Farm
- Liberty Mutual
- Erie Insurance
- American Family
- Clear Cover
- Plymouth Rock
- National General
- Famers Groupselect
- Midvale Home and auto.
Overview of the cheapest car insurance:
- Year Founded: 1922
- Average Monthly Premium: $227
Description: The United Services Automobile Association (USAA) is an American financial services company providing insurance and banking products exclusively to military members, veterans, and their families.VISIT
- Year Founded: 1926
- Average Monthly Premium: $253
Description: Nationwide is one of the world’s leading, diversified insurance companies. They provide a wide range of insurance and financial services.
They are based in Ohio, USA. Aside from car insurance, they also offer business, homeowners, farm, and life insurance.VISIT
- Year Founded: 1936
- Average Monthly Premium: $267
Description: GEICO is one of the largest auto insurance providers in the U.S. It is known for low rates and also offers its services directly to its consumers. Yeah, this should be a top choice for you.VISIT
- Year Founded: 1937
- Average Monthly Premium: $325
Description: Aside from auto insurance, Progressive also offers other types of insurance, such as home insurance.
They are known to operate via their website and call center. Just like the name says, Progressive has adopted technology in dispensing its services and they are affordable and new owners are advised to go for it.VISIT
5. State Farm
- Year Founded: 1922
- Average Monthly Premium: $214
Description: This is a renowned insurance firm in the United States of America. State Farm offers its services to both individuals and businesses.
It is known for its technological advancement and huge online presence. Talk about customer satisfaction and they are at your doorstep.VISIT
- Year Founded: 1931
- Average Monthly Premium: $361
Description: Allstate is a well-known insurance firm based in the United States. It offers a wide number of insurance services.
They offer discount and reward programs for their customers and are hugely invested in technology.VISIT
- Year Founded: 1928
- Average Monthly Premium: $180
Description: The Farmers Insurance Group is one of the leading insurance firms in the United States.
Farmers Insurance has agents across the country to assist customers with any challenge they could have and they offer various insurance types, such as auto, health, property, etc.VISIT
8. Liberty Mutual
- Year Founded: 1912
- Average Monthly Premium: $140
Description: Liberty Mutual Insurance Company was founded in 1912, and ever since then has been a top player in the insurance industry.
They offer a wide range of products, such as property insurance, life insurance, auto insurance, etc. It has a strong presence in the USA, Canada, England, and other European countries.VISIT
- Year Founded: 1916
- Average Monthly Premium: $135
Description: Auto owners provide various products like home insurance, auto insurance, property insurance, etc.
They are known for their commitment to customer service and receive high ratings on various platforms regarding their services.
Auto Owners have expanded their services and now have various independent agents who sell their products.VISIT
10. Erie Insurance
- Year Founded: 1925
- Average Monthly Premium: $216
Description: Erie Insurance is a large insurance company that was founded in the USA. It offers a number of insurance suitable for different individuals.
Erie has been getting high ratings from different trusted online platforms, which claim its financial stability and customer satisfaction.VISIT
11. American Family
- Year Founded: 1927
- Average Monthly Premium: $287
Description: American Family is a multi-insurance company dedicated to inspiring, protecting, and restoring your dreams of having the best insurance.VISIT
- Year Founded: 2004
- Average Monthly Premium: $208
Description: Looking for an insurance company that cares about you? Then here you have it.
Travelers take on the risk and provide the coverage you need to protect the things that are important to you.VISIT
13. Elephant Insurance Company
- Year Founded: 2009
- Average Monthly Premium: $193
Description: The aim of Elephant Auto Insurance is to provide the auto insurance coverage you need at a fair price, backed by great service.
As a young individual who just started driving, this insurance is one of the best and has one of the best prices for you.VISIT
14. Clear Cover
- Year Founded: 2016
- Average Monthly Premium: $274
Description: Clearcover is a smart auto insurance company that’s fast, hassle-free, and easy to understand and helps you save money by insuring your vehicles at a cheap rate. They sell only auto policies.VISIT
- Year Founded: 1923
- Average Monthly Premium: $289
Description: Safeco Insurance makes it easy for you to provide the coverage you need and also connects you with local agents who offer personal advice.
Their customer service is swift with their services and responses.VISIT
16. Plymouth Rock
- Year Founded: 1982
- Average Monthly Premium: 312
Description: This is also a popular insurance firm, especially in the USA. Plymouth Rock offers auto insurance policies to both individuals and companies.VISIT
17. National General
- Year Founded: 1920
- Average Monthly Premium: $330
Description: National General is one of the largest insurers in the United States. They are proud to have been helping people ensure what matters most to them.
They insure homes, properties, life, and some other types of insurance.VISIT
18. Famers Groupselect
- Year Founded: 1954
- Average Monthly Premium: $346
Description: Farmers Groupselect is a personal property insurance program that also provides very affordable car insurance policies.
They provide discounted auto insurance that you can customize based on your needs and budget.VISIT
- Year Founded: 1962
- Average Monthly Premium: $358
Description: Mercury Insurance believes in offering the best of both worlds. Low rates come with excellent coverage, and their local agents are there to create your ideal insurance policy.VISIT
20. Midvale Home and Auto
- Year Founded: 1927
- Average Monthly Premium: $350
Description: Midvale Home and Auto Protects you from expenses for repairs due to things like theft, vandalism, or other disasters. This should make your list when it comes to insurance decisions.VISIT
FAQs on the Best Affordable Car Insurance For New Drivers Under 25
Why Do Insurance Companies Charge More for Young Drivers?
Cheap car insurance for young adult drivers can be difficult to find because the group is often categorized as high-risk.
Do I really have to insure my car?
Yes. You have nothing to lose when you insure your car but everything to lose when you don't. Car insurance protects you against financial loss in the event of an accident or theft.
Does my vehicle affect my car insurance rate?
Yes. Your vehicle type or model affects your insurance rate. The more expensive your vehicle is, the higher your car insurance rate
What is the amount I need for my car insurance?
Well, the prices range. Although it is often advised to go for the highest level of insurance you can afford.
When should I buy car insurance?
Your car insurance plan should be purchased even before you buy a car. Owning a car without insurance is illegal in some countries.
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Young adult drivers can expect to pay significantly less for car insurance than teen drivers. However, rates are still higher for drivers in their 20s than in their 30s. The best way to ensure you get the cheapest car insurance is by reaching out to multiple providers for quotes.
It is important that you carry out some personal research before choosing any of the insurance companies listed above; this will enable you to understand the terms and conditions of the companies.