The Best Auto Insurance for Teens in 2024

Adding a young driver to an existing policy is one of the best ways to lower insurance costs for teens. Auto-Owners Insurance is often the cheapest option for parents who want to add a teen to the family policy because the company charges a flat rate for young drivers 19 and under.

Save With Auto-Owners Insurance Teen Driver Discounts

In addition to low baseline rates, Auto-Owners helps families with teen drivers save with the following discounts specifically for young drivers:

1. Good Student discount: Students get a discount of up to 20 percent if they maintain at least a 3.0 GPA (B average), rank in the top 20 percent of their class, or make the dean’s list or honor roll. The driver must be a full-time high school, college, university, or vocational-technical school student. They can earn this discount until the age of 25.
2. Student away at school discount: Students who attend school more than 100 miles away from home without a vehicle and/or keep their car at home can earn a discount.
3. Teen driver monitoring discount: Many families track their teens’ location by GPS, for safety and peace of mind. Auto-Owners offers a discount if a GPS device is attached to a teen’s car (or the car they use most), or if the teen has an eligible GPS-monitoring app on their smartphone.

Protections Before (and After) an Accident

Due to their inexperience behind the wheel, teens are more likely to get into accidents than nearly any other group. At-fault accidents raise premiums, usually by around 50 percent.

Auto-Owners Insurance offers Accident Forgiveness as an add-on. When you purchase the benefit, Auto-Owners won’t raise your premium if your teen (or someone else on the policy) causes an accident. Drivers must have no at-fault claims or major violations for three years to qualify. It’s a good option for families with a 19-year-old driver with a clean driving record.

Of course, accidents happen — even to the safest of teen drivers. Cars involved in accidents may not be worth as much as they were prior to the crash, even after being fully repaired. Auto-Owners offers Diminished Value Coverage, which covers the difference in a vehicle’s value after an accident. It’s a good option for families who upgrade their vehicles every few years.

Finally, Auto-Owners offers better rates for drivers with existing at-fault accidents on their record than many other providers. On average, the provider’s rates go up approximately 14 percent after an accident, making it a good option for teens with an accident on their record.

When a teen owns a vehicle solely in their name, they often require their own auto insurance policy. Teens on individual policies face higher costs compared to family policies. State Farm offers competitive rates for independent teen policies.

State Farm Savings for Good Teen Drivers

State Farm offers multiple discounts for good driving habits, including a specially designed discount for teen drivers.

Additionally, in many states, State Farm gives discounts to drivers under age 21 who complete an approved driver education class.

Discounts for Students

Teen drivers with a GPA of 3.0 or higher can save up to 25 percent on auto insurance, a discount that can last until they turn 25. Homeschooled students may also qualify if they have taken certain national standardized tests within the past 12 months and ranked in the top 20 percent.

Regardless of their grades, teens attending college away from home can also save. To qualify for a student-away-from-home discount, the driver must:

• Be under the age of 25
• Attend school at least 100 miles away from home
• Use the vehicle only while at home during school vacations and holidays

With an average annual premium of $1,942 for teen drivers on a family policy, Erie has some of the most competitive rates for teen drivers. Customers also report high satisfaction with the company’s claims process and overall customer service. According to a recent J.D. Power study, Erie is the highest-ranked insurer in the Mid-Atlantic and North Central regions, and the second-highest-ranked in the Southeast.¹

Erie’s Young Driver Discounts

None of Erie’s young driver discounts is based on school performance, making it a good option for teens with lower grades. Erie’s young driver discounts help keep premiums low for teen drivers.

Multiple Routes to Accident Forgiveness

Erie offers accident forgiveness to drivers who have been Erie customers for three years or more. In some states, such as North Carolina, you can add accident forgiveness to your policy without waiting three years.

In addition, Erie offers a unique Rate Lock feature. If you add this endorsement to your policy, Erie won’t raise your rates unless you add or remove a vehicle or driver from the policy or change your primary residence. In other words, with Rate Lock, at-fault accidents and violations like speeding tickets won’t raise rates for teen drivers or their families. Other factors, like inflation, won’t raise your premium either.

A few considerations to note:

• Rate Lock doesn’t guarantee continued coverage, meaning Erie can refuse to renew your policy after a serious violation like a DUI.
• Rate Lock is not available in all states.
• Drivers in Virginia can purchase Rate Lock for three years only.

Good Rates for Speeding Tickets

For teen drivers with a speeding ticket on their record, Erie is a good option. On average, premiums increase by about 25 percent after a ticket, but Erie’s go up only 13 percent.

With several paths to earning a student discount, Allstate is a good option for teen drivers regardless of their report card. And the more drivers who sign up for Allstate’s Drivewise safe-driving app, the greater the discount will be. This makes a good option for families with multiple young drivers.

Save With Allstate Student Discounts

Allstate offers three routes to earning its student discount, meaning teens may not need good grades to earn a lower rate. Drivers qualify if they are unmarried, a full-time high school or college student under 25 years old, and fulfill just one of the following requirements:

• Hold a GPA of 2.7 or higher, or at least a B- average
• Complete the TeenSMART driver education program
• Attend school at least 100 miles away from where the car is garaged (and are younger than 21)

The TeenSMART driving program includes videos, simulations, and parent-teen activities that teach teens how to drive safely and avoid hazards on the road. Allstate customers receive a $50 discount on the program, resulting in a final cost of $69.95 per driver. Teens who qualify for the student discount can save around 20 percent on their premiums.

Accident Forgiveness and Accident-Free Discount

Allstate offers an accident forgiveness coverage add-on, which ensures premiums won’t increase even if a teen driver is at fault in an accident. Unlike other providers, Allstate doesn’t require a waiting period before you can add accident forgiveness to your policy.

Additionally, for every six months without an accident, Allstate customers receive a safe driving bonus of up to 5 percent on their auto insurance bill.

Pay-Per-Mile and Usage-Based Options

The U.S. Department of Transportation reports that teens drive an average of about 7,600 miles per year. That’s roughly half as many miles as the average American adult drives each year.²

Teens who drive less than 8,000 miles per year can explore a pay-per-mile insurance plan to save. Allstate is one of the few major insurers to offer such a plan, called Milewise.

With Allstate’s Milewise plan, drivers pay a daily rate for insurance plus a per-mile rate. For example, let’s say you drive 10 miles per day on average:

Allstate uses a device installed in your vehicle to monitor your mileage, allowing you to keep track of your mileage and expenses through the Allstate app. If your family has multiple vehicles under the same policy, not all of them need to be enrolled in Milewise. You can individually decide whether each vehicle is classified as per mile or under a traditional unlimited mileage policy.

Milewise is available in Arizona, Delaware, Florida, Idaho, Illinois, Indiana, Maryland, Massachusetts, Minnesota, Missouri, New Jersey, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Texas, Virginia, Washington, West Virginia, Wisconsin, and Washington D.C.

Allstate’s Drivewise option may make more sense for teens and families with higher mileage. Drivewise is an optional policy add-on, measuring behaviors like speeding, hard braking, and nighttime driving, and offers discounts for safe driving.

USAA is one of the best auto insurance options for military members and their families, especially families with teen drivers. It offers some of the cheapest rates for teens, whether they are insured on a family policy or their own policy.

Low Rates for Teens

USAA offers some of the lowest rates overall for teen drivers from military families, especially for older teens. Teens and their families can find additional savings with the following young driver-specific discounts:

• Good student discount: Drivers under age 25 who maintain a B average or higher or a minimum 3.0 GPA, rank in the upper 20 percent of their class, or make the honor roll or dean’s list qualify for a 20 percent discount.
• Driver training discount: Teens who complete a basic driver education course save on their premium.

Families should note that USAA’s good student discount is not available in North Carolina or Hawaii.

Discount for Young Drivers’ First Policy

Most teen drivers start off on their family’s policy, which is cheaper than buying a separate policy. Eventually, the young driver might want to transition off a family’s policy — maybe because they’ve moved, started a new job, or experienced another life change.

When children of USAA policyholders purchase their own auto policy, they can qualify for a 10 percent discount. To be eligible, the driver needs to have been on their parents’ or guardians’ policy for at least three years, be under 25 years old, and have a clean driving record.