Cheap Car Insurance for 21-Year-Olds

According to our rate estimates, 21-year-olds pay an average of $2,786 per year or $232 per month for full-coverage car insurance. That’s about 56% more expensive than the average for 35-year-old drivers, which is $1,785 per year or about $149 per month. Typically, auto insurance rates are much more expensive for 21-year-olds than they are for older drivers.

Factors That Affect Car Insurance Costs for 21-Year-Olds

Car insurance costs for 21-year-old drivers are determined based on several factors, including driving history, location and credit score. Gender also plays a role in calculating your premiums, especially as a teen or young adult. For instance, young men have disproportionately higher accident rates, which causes them to pay more for coverage than young women. However, some states do not allow insurance companies to use gender in calculating insurance premiums.

Why Is Car Insurance So High for a 21-Year-Old?

Compared to older drivers, 21-year-olds have less driving experience and are more likely to be involved in accidents. Car insurance companies compensate for these risk factors by charging this age group higher rates.

According to the AAA Foundation for Traffic Safety, drivers between the ages of 20 and 24 were 74% more likely to get into an accident than drivers in their 30s in 2015. Below, you can see crash rates for each age group.

High-risk drivers pay higher rates on average, and young drivers typically fall into this category.

The cheapest car insurance for 21-year-olds is USAA, which offers average rates of $134 per month. However, USAA is only available to military members, veterans and their immediate families. Geico is the cheapest company available to any 21-year-old driver, with average rates of $154 per month. Other affordable companies include Auto-Owners Insurance, Erie Insurance and Nationwide.

The best car insurance for 21-year-olds isn’t necessarily the cheapest, but cheap rates definitely help. Below, you can see how 11 popular providers rank on car insurance cost for 21-year-olds.

*Car insurance estimates are based on full-coverage policies with $50,000 bodily injury per person, $100,000 bodily injury per accident, $50,000 property damage per accident and a $500 deductible for collision coverage and comprehensive coverage.

Cheapest Car Insurance for 21-Year-Olds in Each State

Location is one of the factors that affects what you pay for car insurance, and rates can vary significantly by state. Below are each state’s cheapest car insurance companies for full coverage for 21-year-olds. According to our estimates, USAA and Geico are the cheapest providers in many states.

10 Cheapest States for 21-Year-Olds

While 21-year-olds pay $232 per month on average nationwide, drivers in some states pay much less. Insurance in North Carolina averages $129 per month for the age group, for example.

10 Most Expensive States for 21-Year-Olds

Whether because of population density or insurance regulations, some states are much more expensive for 21-year-olds than others. Michigan, Connecticut and Massachusetts top the list.

Our top five picks for the best car insurance for 21-year-olds are Geico, USAA, State Farm, Nationwide and Auto-Owners Insurance. When comparing car insurance companies, our team considers cost, reputation, coverage, availability and customer experience. We found these companies to be affordable for young adult drivers on average.

*The overall rating applies to a standard driving profile, while the ranking order applies to 21-year-old drivers.

*Cost Data taken from 2022 information

Thankfully, age isn’t the only thing that determines car insurance rates. There are a few things you can do to find cheap rates on the best car insurance for 21-year-olds. We recommend thinking about your coverage level and deductible amount, comparing providers, keeping a clean driving record and finding discounts.

Pick the Right Coverage

To save money, you could decrease the amounts covered by options like comprehensive and collision insurance. You could also forgo full coverage and just get minimum coverage levels of bodily injury liability and property damage liability. However, make sure you can handle any costs that your minimum coverage won’t pay for if you’re at fault for an accident.

Choose an Appropriate Deductible

You can lower your payments by increasing your deductible, which is the amount you pay out of pocket if you file a claim. Be sure you can afford the deductible, though.

Compare Providers

One of the easiest ways to get a better rate is to compare companies. We recommend comparing rates each time your car insurance policy is up for renewal. The cheapest companies for teen drivers aren’t necessarily the cheapest for drivers in their early 20s, so it pays to check rates as you get older.

Keep a Clean Driving History

Getting a speeding ticket or causing an accident are surefire ways to get higher rates, and 21-year-old drivers already pay more than average. A clean driving history keeps your rates as low as possible.

Find the Best Car Insurance Discounts

Not all companies offer the same discounts or the same savings on similar discounts. In our picks for the best car insurance for 21-year-olds above, you can see State Farm, Geico and Auto-Owners offer different discount amounts for good students.

Compare quotes online to find the right discounts for your situation. You can also work with an insurance agent to make sure you find all applicable discounts.

As you shop around, keep an eye out for the following types of car insurance discounts:

• Safe driver
• Driving course
• Usage-based programs
• New car
• Added safety features
• Good student
• College student away at school
• Bundling insurance policies

Another way for 21-year-old drivers to save money is to stay on their parents’ policy. This is usually only possible if the young driver has the same permanent address as their parents.

In this article, we outlined the cheapest car insurance rates for 21-year-olds and broke down costs by state. Our top five recommendations for the best car insurance for 21-year-old drivers are Geico, USAA, State Farm, Nationwide and Auto-Owners Insurance. Even with our top picks in mind, we recommend that you compare car insurance quotes from multiple companies to find the best option.

Below are frequently asked questions about the best car insurance for 21-year-olds:

Our Methodology

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.

Here are the factors our ratings take into account:

• Cost: Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
• Coverage: Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
• Reputation and experience: Our research team considered market share, ratings from industry experts and years in business when giving this score.
• Availability: Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
• Customer experience: This score is based on volume of complaints reported by the NAIC and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.

Our credentials:

• 800 hours researched
• 45 companies reviewed
• 8,500+ consumers surveyed

*Data accurate at time of publication.