A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products, including home, life, auto, and commercial, and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, mainly in the insuranc...

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Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Oct 14, 2021

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As most parents realize, the phrases “car insurance”, “young drivers”, and “cheap” have little or no relationship.

An article written by Lynn O’Shaughnessy for CBS News Moneywatch gives data for the states with the highest premium increase when adding a young driver.

These states begin with Arkansas’ premium increases of 116% all the way down to Michigan with an average premium increase of 73%.

If your budget is like most in the United States, even the 73% increase is a blow to your bottom line. On the other hand, there are ways of saving money on car insurance for young drivers short of forbidding them to drive until they are old enough to pay for their own insurance.

Enter your ZIP code above to start searching for car insurance quotes instantly!

Get Estimates (Quotes) from Different Insurance Companies

The most reliable way of saving money on insurance including your teen drivers is to shop.

Most insurance companies do not increase premiums for teens with learner’s permits, so you have a bit of time to prepare for the hit to your budget. Some methods of saving money are:

  • Shop for different insurance companies and compare premiums
  • Raise the deductible on physical damage coverage to your own vehicle – comprehensive and collision.
  • Eliminate comprehensive and collision altogether from older vehicles and restrict younger drivers only to those vehicles. Check Kelley Blue Book to see if it is worth purchasing comprehensive and collision on these vehicles.
  • Purchase a safe vehicle – the Insurance Institute for Highway Safety has safety ratings for vehicles.
  • Encourage young drivers to get good grades in both high school and college. Many insurance companies offer a Good Student Discount for students with a 3.0 or above Grade Point Average.
  • Alert your insurance company if your young driver goes to college over 100 miles away from home – and does not have a vehicle available to drive. Discounts are available in this situation.
  • Take advantage of multi-policy discounts. Purchasing your home insurance policy, automobile policy, and umbrella coverage from the same company may save money.
  • Ask if insurance companies have the benefit of “accident forgiveness” in which minor accidents do not increase premiums.
  • All the drivers in the household should try to keep tickets and points from accumulating on driving records. Good examples are effective.

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Help Your Young Driver Avoid Accidents

There are many ways to help a young driver prevent accidents, a major plus when it comes to premium discounts.

Many states have now adopted the graduated system of obtaining full driving privileges, which covers many of the statistically sound methods of preventing accidents for young drivers:

  • Draw up a formal Teen Driving Contract. A sample is available from the NAIC to be adapted for your young driver.
  • Establish driving curfews – because 40% of teen deaths from auto accidents occur between 9 p.m. and 6 a.m.
  • Limit the number of passengers your teen may have in the vehicle. Statistically, the relative risk of fatalities increases in proportion to the number of passengers.
  • Cell phones should be off limits. Texting and talking on cell phones can double the possibility of accidents. There are smartphone applications that prevent texting and driving.
  • Counsel young drivers to state when they are afraid of the driving practices when they are passengers. Many young people indicate compliance with this, but less than 44% of them actually say something.

Obtaining Car Insurance Quotes

To obtain car insurance quotes comparing premiums, arrange to ask for the same coverage from each company so you get comparable quotes.

Liability Coverage on Your Vehicles

Liability coverage is the state required liability required to drive in your state.

Do not skimp on liability insurance limits because they protect your financial well-being in the event that you or a member of your family is legally responsible for an accident.

Suggested limits if you have a young driver:

  • Bodily Injury Liability – $100,000 per person and $300,000 per accident to pay for bodily injury resulting from an at-fault accident.
  • Property Damage Liability – $50,000 per accident for property damage resulting from an at-fault accident.
  • Medical Payments Coverage – $5,000 – to help defray emergency costs for you and your family if you are involved in an accident.
  • Underinsured/Uninsured Motorists coverage – $100,000 per person and $300,000 per accident to supplement or add to liability coverage when involved with an individual without liability insurance.

Physical Damage Coverage to Your Vehicles

This protects you against monetary damage resulting from an accident involving one of your vehicles.

Examine carefully to see if the cost of this coverage offsets the amount you may be paid in the event of a loss.

  • Comprehensive coverage – pays for damage to your personal vehicle from such things as storms, animal damage, vandalism, glass breakage, and theft.
  • Collision coverage – pays for damages resulting from hitting another automobile or object.

A deductible applies to Comprehensive and Collision coverage. Usually, the higher the deductible, the more premium credit you may receive. Estimate what you can afford and set the deductible at that.

Information You Will Need for Quotations

In order to acquire an automobile insurance quotation, you will need to have the following information:

Drivers Information

  • Name, address, and drivers license number for all drivers
  • Driving record for drivers as well as dates of birth
  • Occupation of drivers as well as educational level for each
  • Verification of Driver’s Education Courses or Defensive Driving Courses
  • Verification of Grade Point Average and credits enrolled for students

Automobile Information

  • Year, Make, and Model of all automobiles
  • VIN numbers
  • Number of miles driven daily as well as annually per auto
  • Usage of automobiles – example: to and from work or school, pleasure use, or business use

Insurance Company Information

Take time to examine the financial information pertaining to the insurance companies from which you obtain quotes. Complaint statistics are also a valuable resource. These are available from:

  • Your state’s insurance website – contains licensing information, too
  • National Association of Insurance Commissioners (NAIC)
  • A. M. Best Ratings
  • Standard and Poor’s Ratings

Examining financial ratings can help you get a feel for the stability of the insurance company, whereas complaint statistics allow you to see how they settle claims and disputes.

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Insuring a young driver is not inexpensive, but it is best to recognize that this cost is a portion of education for young drivers.

Most 16-year-olds have one accident, but they learn quickly.

Rates reduce as the driver gets older and has more experience.

Young drivers with careful supervision, such as contracts between parent and child and enforcement of the contract, have shown trends toward being more safe drivers.

Use our FREE car insurance quote comparison tool below to start shopping today! Enter your ZIP code to get started.