The Best Cheap Car Insurance Companies for New Drivers of 2023

Learn which companies provide the cheapest car insurance for new drivers. Compare the insurance coverage discounts, ratings, pros, and cons.
Young driver

When you're beginning to drive or are a new driver, there is a lot to consider besides driving safely and responsibly on the road.

Being a new driver affects how insurance companies view you, as they constantly assess risk when it comes to insuring drivers.

Before you get a quote for car insurance, you should know that, despite some risk factors, insurance companies are, first and foremost, trying to find new customers.

To prove it, they all offer various discounts, including to new drivers hoping to encourage you to get a quote.

However, you must remember each insurance company has different discounts for new drivers.

Not all insurance companies will offer the same discount.

We’ve researched the nation’s top insurance companies to find the best coverage and discounts for new drivers.

No two new drivers are alike, so different policies benefit different types of new drivers.

As you locate your specific new driver category in the article, you’ll find discounts available matching your new driver situation.

Generally, be sure you ask about all the discounts available, as discounts lower your insurance premium.

Best Cheap Car Insurance Companies for New Drivers

  • Farmers: Best for Tech-Savvy New Drivers
  • State Farm: Best for Teenager Drivers
  • Allstate: Best for Newly Licensed Young or Adult Drivers
  • GEICO: Best for Newly Licensed Foreign Drivers
  • Progressive: Best for Restricted & Reinstated Licensed Drivers
  • Allstate: Best Cheap Car Insurance if Your Coverage has Lapsed

Farmers: Best Car Insurance for Tech-Savvy New Drivers

Editors star rating review
4.5
Editor's Rating (4.5 Stars out of 5)

Cheap insurance rates aren’t the only thing that new drivers should consider.

In today’s technology-driven world, there are other important considerations.

All drivers will benefit as the insurance industry focuses on innovative and competitive technology.

The best car insurance companies should offer state-of-the-art technology.

Farmers Insurance is one of the top contenders in technology.

Ease of access and consistent delivery of an online experience is key to customer relationships, especially when it's at the touch of a screen on your phone.

Farmers offers a smartphone app so you can manage your policy and even ask for road side assistance.

Instant access to policy information is important as consumers may need to verify coverage at a moment's notice.

The ability to easily pay a bill online, obtain a new ID card, or review coverages are hot buttons for all consumers.

Farmers, while a little pricier on average than other major players, also provides superior comprehensive coverage, including a glass deductible buyback, accident forgiveness, and car replacement.

How is Farmers Car Insurance Rated?
J.D. Power (out of 1,000) 839
A.M. Best - Financial Strength Rating A
BBB A-
NAIC Complaint Index 1.19

State Farm: Best Cheap Insurance for Teenager Drivers

Editors star rating review
4.5
Editor's Rating (4.5 Stars out of 5)

When it comes to car insurance for teenage drivers, there are a few things to keep in mind. First, car insurance rates are typically higher for teenagers than they are for adults.

This is because teenagers are considered to be high-risk drivers. Second, there are a few ways to get discounts on car insurance for teenage drivers.

Many insurers offer discounts for good students, for taking driver’s education courses, and for driving vehicles with certain safety features.

Finally, it’s important to make sure that teenage drivers have the coverage they need. This includes liability coverage in case of an accident and collision and comprehensive coverage in case of damage to the vehicle.

By keeping these things in mind, you can find the best cheap car insurance for teenage drivers.

We found thatState Farm scored the best in this category for overall pricing, website usability, number of overall policy discounts, and top customer service; with Progressive and Travelers as contenders.

All companies have a UBI option, including educational tools for young new drivers.

Look for companies that are forgiving for accidents or tickets regarding teenage drivers in the first 1 or 2 years of driving.

The surcharge will impact you, and finding more competitive insurance after that accident or ticket will be difficult.

Other key factors in choosing your car insurance are financial stability and the technology tools available to support your car insurance policy service experience.

Remember, each company may have specific rules, restrictions, and underwriting guidelines within your state. You will find some markets have very high discounts for good grades.

Obtain a quote from each insurance company you’re interested in and make a comparison before you make a decision.

How Can Teenage or Young Drivers Get Cheap Car Insurance?

The biggest challenge for the young driver is lack of experience.

It's not just a lack of driving experience but life experience in general.

Young drivers should look at their parent’s household and see if they can join as a driver on mom & dad’s policy first.

The discounts will be more advantageous for participating in a policy bundle & household. If that isn’t available, look for all available driver, vehicle, and policy discounts for a premium reduction before choosing.

How is State Farm Car Insurance Rated?
J.D. Power (out of 1,000) 814
A.M. Best - Financial Strength Rating A++
BBB A+
NAIC Complaint Index 4.29

Allstate: Best Car Insurance for Newly Licensed Young or Adult Drivers

Editors star rating review
5.0
Editor's Rating (5 Stars out of 5)

Single drivers in this category should consider a focus on policy and vehicle discounts to offset their new driver status.

Allstate are the top choice in this category for drivers aged 20 or 21, as each company offers a UBI option and top vehicle discounts.

Single or married adult drivers aged 22 to 26 may qualify for additional policy discounts as homeowners.

And additional drivers or vehicles in the household can qualify you for bundled discount savings.

Add these recommendations of Progressive and GEICO to the group, as they may be a great fit in specific markets.

Industry experts consider all policy discounts, underwriting, claims-paying ability, customer satisfaction, financial stability, technology tools, and the best rates when completing a car insurance assessment.

If you own a home, own multiple vehicles, have taken a defensive driving course, or have good credit, that will also help lower your car insurance premium.

How is Allstate Car Insurance Rated?
J.D. Power (out of 1,000) 826
A.M. Best - Financial Strength Rating A+
NAIC Complaint Index 4.04
BBB A-

GEICO: Best Car Insurance for Newly Licensed Foreign Drivers

Editors star rating review
4.0
Editor's Rating (4 Stars out of 5)

Car insurance can be even more important for foreign drivers who are new to the country. While most car insurance companies will provide coverage for foreign drivers, it is important to shop around and compare rates before choosing a policy.

GEICO is one of the leading car insurance providers for newly licensed foreign drivers.

Allstate, and Progressive are close second options based on our research for this category.

Policy and vehicle discounts are the best recommendations we can make to offset the lack of driving experience.

A newer vehicle with safety features, ADAS, and anti-theft systems will lower insurance premiums for this driver category.

We don’t recommend purchasing a new vehicle for the discounts, but it can positively impact insurance rates.

If you own a home, own multiple vehicles, have taken a defensive driving course, or have good credit, that will also help lower your car insurance premium.

Industry experts take into account all levels of policy discounts, underwriting, claims-paying ability, customer satisfaction, financial stability, technology tools, and the best rates when completing a car insurance assessment.

Read a full GEICO car insurance review.

How Do Foreign Licensed Drivers Get Affordable Rates?

The additional cost for insurance will be higher while the newly insured gains driving experience in the USA.

Consumers should focus on driver discount options like Usage Based Insurance (UBI).

New drivers will find a benefit from this discount by allowing the insurance company to monitor certain driving habits for a specified period of time.

Each insurance company that offers UBI routinely includes an education piece for drivers to assess their driving habits.

New drivers can benefit from UBI discounts and improve their overall driving habits.

Drivers may face licensing challenges as each country has different laws and cultures.

Insurance does not transfer into the USA as a consumer might expect.

Remember, you’ll need proof of citizenship documentation, a requirement in some states.

Be prepared for documentation rejection regarding any previous driving record or insurance history.

New drivers coming from another country should first focus on understanding the laws, rules, and regulations for car insurance in the USA.

How is GEICO Rated?
J.D. Power (out of 1,000) 824
A.M. Best - Financial Strength Rating A++
BBB A+

Progressive: Best Car Insurance for Restricted & Reinstated Licensed Drivers

Editors star rating review
4.0
Editor's Rating (4 Stars out of 5)

Many states have strict documentation requirements for restricted or reinstated drivers.

If you are required by law to carry insurance and need proof of insurance, you may be somewhat limited in the insurance companies that can help.

Look for standard insurance companies with little or no restriction on the paperwork documentation that must be filed, like Progressive, GEICO, or Allstate.

If you have a restricted or reinstated license, you may be worried that you won't be able to find affordable car insurance.

However, Progressive offers a variety of options for restricted and reinstated drivers, so you can get the coverage you need at a price you can afford.

Whether you're looking for liability, collision, or comprehensive coverage, Progressive has the right plan.

And because they offer discounts for online quotes and safe driving, you could save even more on your car insurance premium.

How Do You Get Cheap Insurance After Your License is Reinstated or a Restriction is Lifted?

New drivers with a licensing restriction should focus on other positive attributes that impact the cost of insurance.

One key in underwriting variables is the insurance credit score.

New drivers with a top insurance credit score will get cheaper insurance even with a poor driving record.

Look for standard insurance companies that understand this driver profile.

The biggest challenge for this type of driver will be the past accident and ticket history that created the initial restriction on the license.

Maintain a copy of your driving record so you can watch for accidents and tickets that will "drop off" your record.

Reach out to the insurance company each time a ticket or accident drops off in case your insurance cost can be reduced.

How is Progressive Car Insurance Rated?
J.D. Power (out of 1,000) 803
A.M. Best - Financial Strength Rating A+
NAIC Complaint Index 2.24

Allstate: Best Cheap Car Insurance if Your Coverage has Lapsed

Editors star rating review
5.0
Editor's Rating (5 Stars out of 5)

Look for national companies that offer a standard instead of a preferred policy, like our recommendations of Allstate, Progressive or GEICO.

Companies like these can offer a flexible due date or a payment date change you can push or set back when you have difficulty making the payment are a great option.

These companies also meet our customers and claim service satisfaction ratings.

Allstate offers a variety of discounts that can help to lower your premium, even if your coverage has lapsed.

For example, if you've been driving for three years without any accidents or violations, you may be eligible for a safe driver discount.

Similarly, if you have a clean driving record, you may be able to get a good student discount. In addition, Allstate offers a variety of other discounts that can save you money on your premium.

How Do You Get Cheap Insurance If You’ve Let Your Car Insurance Lapse?

Don’t worry, you’ll still be able to find affordable insurance for your car.

These companies have lenient late pay or reinstatement fees you may be required to pay if you do get into trouble and can’t make the payment on time.

Review any specific restrictions or surcharges that occur due to a "gap" in insurance coverage.

Ask when those restrictions will be lifted so you can expect a premium decrease or stabilization.

What is the Best Discount on Car Insurance for a New Driver?

Within car insurance, there are three main discount categories:

  • Driver
  • Vehicle
  • General policy discounts

The first two categories are about the driver and vehicle. Those discounts can vary depending on your new driver category status.

The third category is the total customer policies with the same company. Each company discount offered may vary depending on the underwriting that is done about the driver and vehicle.

The last advantage for new drivers is the overall policy discounts available.

While there isn’t one number that applies to all states, we can confidently share that the average savings for new drivers and their vehicles can range from 5-20% annually based on the companies noted in this table offering various discounts.

Which Discounts Save New Drivers the Most Money?

Plenty of discounts can lower a new driver's premium in many ways.

One well-known discount is “bundling” your insurance. That means having more than one policy with the same company.

Homeowners or renters insurance usually make a great match to a car policy for a bundle discount.

Bundling homeowners or renters and car insurance should lower your insurance premiums from 5-20%.
Progressive and Liberty Mutual offer a discount as a homeowner, even if you do not insure your home with the company. That savings can be up to 17%.

Normally, a homeowner can expect to receive a higher bundled discount in contrast to a renter with two policies at one company.

Ask the insurance company if the discount is a flat discount or a percentage of the premium and if will it go away over time.

At What Age Does Car Insurance Go Down?

Car insurance rates are based on various factors, including the driver's age, driving history, and the type of car being insured. In general, rates go down as drivers get older and more experienced.

However, there are some exceptions to this rule.

For example, drivers under the age of 25 are typically considered to be high-risk and therefore pay higher rates.

Additionally, rates may go up for drivers with poor credit or a history of accidents.

While there is no definite answer as to when car insurance rates go down, it is generally safe to say that rates will decrease as drivers gain experience and build up a good driving record.

Can a Few People Insure the Same Car?

In general, the primary driver on an insurance policy must be the owner of the vehicle or someone who has been specifically named by the owner.

That said, there are some circumstances in which two or more people can insure the same car.

For example, if you're a young driver looking to get cheaper rates, you may be able to add your car to your parent's insurance policy.

Or, if you live with a roommate, you may be able to find a policy that covers both of you.

Ultimately, the best way to find out if you can insure a car with someone else is to talk to your insurance provider. They'll be able to give you specific advice based on your individual situation.

What Does Fronting Mean in Insurance?

Aside from the monthly cost, there's also the pain of filling out all the paperwork and understanding all the jargon. One term you might come across is fronting.

Fronting occurs when the main driver on a car insurance policy is listed as someone other than the person who will be driving the car most often.

This is usually done in an attempt to get cheaper car insurance, as rates are typically lower for drivers who are married or over the age of 25.

While fronting is technically legal, it's important, to be honest when applying for car insurance. If you're caught fronting, your insurer could cancel your policy and leave you without coverage.

Summary

Whether you're a newer driver or an experienced one, you should always carry coverage. Not only is important for the what-ifs, but it's the law.

Just like the requirements it took to learn to drive, owning and operating a vehicle carries its own requirements--and insurance is one of them.

When shopping for insurance, it's important to consider that the industry continues to innovate and change to meet consumer demands.

Our ongoing reviews of car insurance companies are designed to assist consumers in education before purchasing car insurance.

The companies noted in this article meet or exceed our expectations as top car insurance companies, and should help you narrow your choices down.

It's important to figure out what options and coverage are available in your state so you should do your own homework and get quotes to get your individual pricing and policy.


How We Picked the Best Insurance Companies for New Drivers

We understand that no single company can do everything one consumer is looking for in today’s marketplace.

As experts, we work to address our research and information shared on several items. Overall, we measured the following categories in this article for car insurance purchases.

Number and Type of Discounts Best for New Drivers

We choose our top car insurance choices for new drivers based on the overall number of discounts for new drivers and then considered which may save you the most money. Remember, discounts in one part of the country may be different than in another. Be sure to check which discounts are available in your community.

Customer Satisfaction & Technology

All new drivers want to experience excellent customer service.

Our top companies meet or exceed various industry consumer satisfaction surveys every year. You can locate company satisfaction reviews anytime by checking out JD Powers, a nationally recognized company offering satisfaction surveys on all types of content and businesses.

Customer satisfaction should include high ratings regarding online access for client ease of use. Technology tools are key to customer service.

Access to your information outside of normal business hours or to follow the progress of a claim are high on our list for choosing our top insurance company.

Coverage Options

Matching the right coverages at the right price for a new driver can get complicated.

We researched and found our top companies have overall competitive premium pricing structures that match quality coverages.

Watch for premium surcharges when choosing high coverage and limits, as new drivers pose a different risk than experienced ones.

If a company encourages you to take the least amount of coverage, it may not be the best choice.

Restrictive Measures on New Drivers

Understanding the discounts and surcharges that overlay a car insurance quote is important.

Industry experts chose our top companies based on the overall performance of the final premium and coverage options discounts available for new drivers.

Financial Stability

Each car insurance company must file a financial report with the state department of insurance in which they do business.

Consumers can always contact their insurance department for financial information on a company before purchasing car insurance.

Our experts review a wide scope of industry reports before choosing our top car insurance choices.