Cheap car insurance for 16-year-olds

Cheap car insurance for 16-year-olds
6 min read

Cheap car insurance for 16-year-olds

How much is auto insurance for a 16-year-old?

Almost every auto insurance premium factor boils down to one simple question: what is the risk? Statistically speaking, a 16-year-old teen driver is less experienced and therefore more likely to receive a citation or cause an accident. In the eyes of an insurance company, that means more risk and a greater need for financial protection, meaning higher premiums. It should come as no surprise that the average 16-year-old in 2019 paid an annual premium of $6,647 for insurance compared to the national average of $1,548.

There are many things that an insurance company considers when determining a driver's auto insurance rate. Age, gender, where you live, and what you drive all affect how much you pay. And when you're paying significantly more to insure a newly licensed driver, you want to make sure you're getting the best possible deal. So let's break it down, starting with the insurance company you should choose.

How Much Is Insurance for a 16-Year-Old? Is It Worth It?

Auto Insurance Policies for 16-Year-Olds: A Guide

  1. By cheaper popular companies
  2. By age
  3. By gender: cheapest car insurance for men
  4. By location
  5. By Vehicle
  6. What are some ways to save?
  7. Auto Insurance for 16-Year-Olds: Overview

What company offers the cheapest car insurance for a 16-year-old?

In our survey of average premiums for 16-year-old teen drivers, we identified  Nationwide as the best auto insurance company for a typical 16-year-old driver, with State Farm in second place. Keep in mind that you or your teen driver may not fit Hispanic Finance's composite profile, so be sure to compare a diverse collection of insurance companies to find the best rate for you. Because auto policy rates change so much with the age of drivers, we recommend comparing auto insurance rates every six months. 

Although the selected profile and policy may differ from your family's, you can use the data below as a basic starting point.

Insurance company Average Premium: 6-month policy
Allstate $4,350
farmers $4,592
GEICO $3,233
Liberty Mutual $4,443
nationwide $3,075
Progressive $5,412
State Farm $3,100

How much do 16-year-olds pay for car insurance, on average?

Age is an important ranking factor for drivers. Drivers between the ages of 16 and 19 pay more than drivers in any other age group. These high auto insurance rates are due to the lack of driving experience among this group and the risk-taking tendency of young drivers, which could lead to more frequent claims and higher costs incurred by an insurance company.

Below are the average rates per six-month policy for 16, 17, and 18-year-olds adding to a family plan where the parents are 50 and insuring a 2012 Honda Accord and 2012 Ford Escape. To see more information on rates for teens added to a family plan, learn more below for a breakdown by state.

How does your gender affect your cousin?

Just like your child's age, gender can affect your insurance premiums. Statistically, a young driver is more likely to receive a citation or be involved in an accident than a young female driver. As such, they are more expensive to insure. On average, 16-year-old men pay more than $440 more per six-month policy period for insurance than their female counterparts. Still, it's worth considering that as you get older, the difference between men and women becomes less significant. In fact, some states do not use gender as a metric to determine auto insurance rates.

How Location Influences Teen Car Insurance Rates

Where you live also plays a big role in deciding your young driver's insurance premiums. Because insurance as a whole is state-regulated and ZIP code specific, variations between the area where you live will cause the cost of auto insurance to vary wildly.

States with high bodily injury claims or states with no-fault laws, such as Michigan or Florida, will cost more to insure. Additionally, the number of drivers in your state can also affect your child's insurance rate. States with a low population density where there are fewer bodily injury or general liability insurance claims, such as Midwestern states like Ohio, tend to have lower premiums than states that are more populous.

The more drivers your state has, the more likely you are to be in close proximity to other drivers, increasing the chances of a collision. Insurance companies must take into account that additional risk.

Cheaper vehicles for the insurance of a 16-year-old driver

The type of car your teen drives will have an impact on your auto insurance rates. For example, a teenager with an off-road truck is statistically more likely to have a higher insurance rate than a modest sedan. As a general rule of thumb, any vehicle with a high MSRP will have a correspondingly high premium due to the expense your insurance company will have to pay to replace it if it totals out. So if you're looking for a cheaper rate for your teen driver, you should stick with a simple car like a sedan.

Also, consider the type of insurance coverage your teen driver's vehicle has. If your teen has comprehensive coverage, including comprehensive and collision as well as uninsured motorist coverage, you can expect to pay more.

How to save on car insurance for a 16-year-old

Now that we've talked about why it's so expensive to insure a 16-year-old, let's look at some ways to save.

Good discount for students

If your driver has the qualifications, you may want to consider a good student discount. Your insurance company will require proof, such as a transcript. Typically, your insurer will require a GPA greater than 3.0 or a "B" average. But this can vary, so you'll want to talk to your insurer specifically for more details.

Oliver Reed 95
Joined: 8 months ago
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