How much is car insurance for 20-year-olds?
Fact-checked with HomeInsurance.com
Young adults are just starting out in life, and high car insurance costs are one of the many challenges they face. The national average cost of car insurance is $1,555, but teens and young adults typically pay about double that amount. There are valid reasons — a 20-year-old doesn’t have the driving experience of a 30-year-old. In fact, the 20- to 24-year-old age category has the highest rate of deaths in a car accident of all ages. This age group represents 18% of the fatalities from motor vehicle crashes. Take a closer look in this article at how much car insurance for 20-year-old male and females will cost and how you can save.
Car insurance for 20-year-olds
The average annual cost of car insurance for 20-year-olds is $3,592. It’s more than twice the national average car insurance cost of $1,555 per year. While still steep, this rate for 20-year-olds is actually a reduction from the price a teen driver would pay. A teen car insurance policy is $4,048 for a male and $3,819 for a female on average annually.
The biggest factor that affects the rate of a 20-year-old driver is inexperience. Younger drivers are more likely to be involved in an accident due to their lack of experience behind the wheel. As a driver ages, their driving knowledge and skill improve, reducing the risk of being involved in a crash.
20-year-old car insurance rates: male vs female
Car insurance for a 20-year-old male is different from the cost for a female of the same age, as indicated in the table below. A female young adult pays lower insurance costs than a male, primarily because of the number of accidents a male vs. female is involved in. According to the Insurance Institute for Highway Safety (IIHS), young males die in car crashes at nearly triple the rate of females (2,902 deaths vs. 1,024).
The difference between genders is high when drivers are younger and gradually decreases to close the gap by age 30. Younger male drivers are more likely to speed, drink alcohol or fail to wear their seatbelt.
|Gender||Average annual cost for 20-year-olds|
Quadrant information services, 2020
How much is car insurance for 20-year-olds in my state?
Another factor that can affect the cost of car insurance for a 20-year-old is location; insurance rates can vary significantly by state. The table below compares the average rates for car insurance for 20-year-olds by state, indicating the difference in cost and percentage to the national average.
Average cost of insurance by state for 20-year-olds
|State||Average annual cost for 20-year-olds||Cost difference from national average||Percentage difference|
|District of Columbia||$3,701||$364||10%|
Quadrant information services, 2020
Most expensive states for car insurance for 20-year-olds
Based on the data in the table above, the 5 most expensive states for 20-year-olds are:
These states are high across the board for all ages due to population density, accident averages and other unique factors. Liability, insurance fraud and the number of uninsured drivers are just a few of the issues that can affect the high cost of insurance in these states.
Michigan and New York are no-fault states, which causes insurance premiums to be much higher than average. Michigan has the highest insurance rates in the country due to this reason, necessitating all drivers to carry personal injury protection insurance to cover the unlimited medical benefits the state allows. Florida’s car insurance rates are high because of the number of uninsured drivers, who account for more than 26% of drivers in the state.
Least expensive states for car insurance for 20-year-olds
The price for insurance for a 20-year-old between the most expensive and least expensive state is a difference of $5,386. The least expensive states are:
The cheapest states for car insurance are low in cost for many of the same reasons some states are more expensive. Population density, the number of drivers and accident statistics affect rates. Competition among insurance companies within the state tends to lower premiums for everyone. Weather is also a contributor — Hawaii and North Carolina don’t have extreme weather, which increases the risk of accidents.
Car insurance rates by insurance carrier for 20-year-olds
We compared what the top insurance carriers charge to insure a 20-year-old driver. The most expensive carriers for young, male drivers are The Hanover, Allstate, MetLife, Farmers and Progressive. The providers with the highest rates for young, female drivers include The Hanover, MetLife, Allstate, Farmers and State Farm.
A 20-year-old driver fares better with Erie, USAA, Geico, AAA or Travelers for lower rates. However, AAA and USAA both require membership to qualify for car insurance. AAA membership is available to most drivers, but USAA is for active duty or retired military and their family members only. It’s best to compare quotes from the lower-cost insurers to determine which one is best.
Military and their family members could benefit most from car insurance from USAA. Erie provides coverage in New England, Ohio and Tennessee. Geico may be best for 20-year-old students, thanks to the discounts offered to drivers who are attending college. Travelers is a better option for female drivers, as a 20-year-old male pays almost $500 more in car insurance with this provider.
The chart below compares the average premiums for male and female 20-year-olds by provider and includes the cost difference to the national average by gender.
|Company||Average annual cost for 20-year-old female||Cost difference from national average||Average annual cost for 20-year-old male||Cost difference from national average|
How to get cheap car insurance for 20-year-olds
With such high rates in your 20’s, finding ways to save on car insurance is critical. Saving as little as 5% on a $3,000 policy puts $150 back in your pocket every year. Consider the following ideas to lower your car insurance costs:
Look for discounts
Car insurers provide a number of discounts that could cut as much as 25% off your car insurance. Some of the most common discounts you may qualify for include:
Take a drivers safety course
One of the primary reasons a young driver’s car insurance is so high is the lack of driving experience. Defensive driving safety courses are available to take that could lower car insurance premiums over several years. Most can be completed online in just a few hours, making them a worthwhile option for additional savings.
Add a 20-year-old to the family plan
In some cases, it may be much cheaper to add a 20-year-old and his/her vehicle to an existing policy. There’s only one drawback — if the young driver is involved in an accident, all your other vehicle policies may go up in price. Before you add a young adult driver, check with your insurer to find out if they have an accident forgiveness policy that doesn’t raise your insurance costs after one accident.
Choose a sensible car
Some cars are much more expensive to insure than others. Sports cars and SUVs are some examples of vehicles you should steer clear of if you’re worried about car insurance premiums. An eco-friendly hybrid or compact car may be far less expensive to insure.
Raise your deductible
The deductible is the amount you’ll pay out-of-pocket before your insurance company steps in to pay the rest. Consider raising the deductible amount to lower your insurance premiums. Before you raise the amount, make sure you can afford to pay the lump sum in the case of a claim.
Car insurance rates for 20-year-olds with good student discount
If a 20-year-old is enrolled in college, they could leverage their student status to save money using a good student discount:
- Rate without discount: $3,592
- Rate with discount: $3,294
- Savings: 9%
That’s almost $300 in savings per year on your car insurance policy.
In what states does the good student discount save you the most?
Let’s take a closer look at potential savings from having a good student discount by state. Based on the data below, you will save the most in the states of Michigan, Minnesota and Wyoming.
There are a couple of factors at play as to why the student savings are higher in certain states. Good student discounts are typically factored as a percentage off your policy — states with higher insurance premiums may give you the biggest savings. In addition, insurers may offer better discounts in states with more college students.
Good student discount savings by state
|National Average||Annual rate with discount for 20-year-old||Rate without discount for 20-year-old||Savings|
- The cost of car insurance for a 20-year-old is one of the highest of all age ranges
- Male drivers in the 20 to 24-year-old age group pay more than females because they are three times more likely to die in a car crash
- Young driver car insurance can vary by state
- Taking advantage of good student driver discounts can lower your insurance premium up to 9% off
Young drivers face high car insurance costs when they’re starting out. It takes time to gain experience behind the wheel, so in the meantime, there’s not much to do about it other than find ways to save on insurance. Savings options include taking advantage of good student discounts and completing a defensive driving online course. As a 20-year-old driver gets older, they’ll see their insurance premiums lower. In the meantime, making responsible choices and driving safely will help them see lower car insurance costs sooner.
Coverage utilizes Quadrant Information Services to analyze quoted rates from thousands of zip codes across all 50 states including Washington D.C. Quoted rates are based on the profiles of a 20-year-old male and female, each with a clean record driving a 2016 Honda Civic. The drivers had the following coverage details:
- $50k bodily injury liability per person
- $100k bodily injury liability coverage per crash
- $50k property damage liability coverage per crash
- $500 collision coverage deductible
- $500 comprehensive coverage deductible
To look at the effect of a good driver discount, we analyzed rates for the profile both with and without the discount applied. These rates should be used to inform your car insurance shopping process, but note that your actual rates may differ.