Best car insurance for 21-year olds

Of major carriers, USAA has the lowest average rate for car insurance for 21-year-olds, at $1,562 per year, followed by GEICO at $1,783 a year.

Stephanie Nieves author photo

By

Stephanie Nieves

Stephanie Nieves

Property and Casualty Insurance Expert

Stephanie Nieves is an insurance editor at Policygenius in New York City, specializing in home and auto insurance. Her work has appeared in Business Insider, PayScale, Fairygodboss, and The Muse.

Published November 12, 2021|3 min read

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A car insurance policy for a 21-year-old will probably be cheaper than coverage for a teenager, but it may still be pretty pricey depending on the company. At 21, you’re still considered a young driver, which means higher rates.

Since rates vary from company to company, you can still find the coverage you need at an affordable price by shopping around and comparing quotes. Our analysis found that, of major car insurance companies, USAA had the cheapest average annual premium at $1,562, followed by GEICO at $1,783 a year.

Key Takeaways

  • Out of 10 major car insurance companies, USAA had the cheapest average rate for 21-year-old drivers, at $1,562 a year

  • GEICO had the second cheapest average rate for 21-year-old drivers, at $1,783 a year

  • Young drivers can save on car insurance by joining their parents policy, taking advantage of discounts, and shopping around for cheaper insurance

10 cheapest car insurance companies for 21-year-old drivers

Full coverage car insurance for a 21-year-old can cost thousands of dollars a year. But shopping around for coverage and comparing quotes from multiple companies can help you find an affordable policy, even as a young driver.

Here are the average rates for full coverage car insurance for a 21-year-old at 10 of the biggest car insurance companies in the U.S.:

Car insurance companyAverage annual premium
USAA$1,562
GEICO$1,783
Erie$1,960
State Farm$2,019
American Family$2,152
Travelers$2,296
Nationwide$2,418
Farmers$2,781
Progressive$2,881
Allstate$2,940

Young drivers can often find cheaper rates at smaller, regional companies that don’t operate nationwide, so make sure to compare plenty of options before you pick a policy.

Compare rates for 21-year-old drivers

The younger you are, the more you’ll pay for car insurance. Teenagers pay the most for a policy of their own, but car insurance gets cheaper the older you get, until it eventually levels out at age 25. 

AgeGenderAverage annual cost
16Female$6,351
Male$7,207
18Female$4,594
Male$5,268
21Female$2,548
Male$2,867
25Female$1,875
Male$1,983

How to save money on car insurance as a 21-year-old

If you want to save on car insurance for as a young adult, there are a few simple steps you can take that can help lower your costs:

1. Join your parent’s policy

If you live at home, you can save money on your car insurance by joining an existing policy rather than taking out your own. Your parent’s rates will go up with a young driver on their policy, but it will still be cheaper than buying separate coverage (however you’ll need to get a policy of your own once you move out and have your own car). 

2. Take advantage of discounts 

Discounts can help you lower your rates, and car insurance companies offer discounts for everything from being affiliated with a sorority or fraternity to completing a safe driving course. Full-time students can usually save on car insurance if they maintain above a certain GPA. 

3. Compare quotes from multiple companies

You can find the coverage you need at the cheapest price by getting quotes from multiple companies and comparing options before you buy. You may be able to spend a lot less money at one company than another for identical coverage. 

4. Drop comprehensive and collision

If the car you’re driving is an old clunker that isn’t worth repairing or replacing if it’s damaged, you can consider dropping comprehensive and collision coverage, as long as you’re not financing or leasing your vehicle. A good rule of thumb is that you can drop both coverages if your comprehensive and collision premiums equal 10% or more of your car’s actual cash value.

Frequently Asked Questions

At what age do car insurance rates go down?

Car insurance for a young driver can cost thousands of dollars a month, but your car insurance rates typically go down as you approach 25, at which point they level out.

How long does car insurance take to kick in?

Applying for a car insurance policy can often take as little as 20 minutes, and in many cases, your car insurance coverage can begin the same day you apply. As long as you pay your premiums, your policy will stay active through the length of your policy term, usually six months or a year.

Can I get car insurance for a day?

Most car insurance policies have term limits of six months or one year. You generally can’t get car insurance for just one day. But if you’re renting a car and need coverage,you can buy rental car insurance from the rental company if you’re not covered by an existing policy or your credit card benefits. If you’re borrowing someone else’s car, their insurance will typically extend to you too, even if they’re not in the car with you.

Methodology

Policygenius has analyzed car insurance rates provided by Quadrant Information Services for every ZIP code in all 50 states plus Washington, D.C. For full coverage policies, the following coverage limits were used:

  • Bodily injury liability: 50/100

  • Property damage liability: $50,000

  • Uninsured/underinsured motorist: 50/100

  • Comprehensive: $500 deductible

  • Collision: $500 deductible

In some cases, additional coverages were added where required by state or insurer. Our sample vehicle was a 2017 Toyota Camry LE driven 10,000 miles/year.

Some carriers may be represented by affiliates or subsidiaries. Rates provided are a sample of costs. Your actual quotes may differ.