Getting car insurance as a new driver can feel like an uphill battle. Without a driving history, insurers consider you a high-risk driver, which often leads to high premiums. New drivers, regardless of their age, usually face some of the highest insurance rates because they lack experience on the road. However, with the right strategies and knowledge, new drivers can find affordable car insurance that provides sufficient coverage without breaking the bank. This article will explore how new drivers can secure cheap car insurance, even with no experience.
Why Insurance is Expensive for New Drivers
Before delving into how to reduce premiums, it’s important to understand why insurance is generally expensive for new drivers. Insurance companies calculate premiums based on the level of risk a driver poses. Since new drivers lack a track record, they are statistically more likely to be involved in accidents due to inexperience, leading to higher insurance costs.
Several key factors contribute to this:
- Lack of driving history: Without a history of safe driving, insurance companies have no way to gauge how responsible you are on the road.
- Accident statistics: Data shows that new drivers, especially teenagers, are involved in more accidents compared to more experienced drivers. This increased likelihood of accidents leads to higher premiums.
- Higher risk of claims: New drivers are more likely to file claims due to accidents, leading to insurers charging more upfront to cover potential payouts.
Despite these factors, new drivers have multiple avenues to explore to find affordable coverage.
Tips for Finding Cheap Car Insurance for New Drivers
1. Choose a Vehicle That’s Cheap to Insure
One of the easiest ways for new drivers to lower their car insurance premiums is by choosing the right vehicle. Certain cars cost significantly more to insure than others due to factors like safety ratings, repair costs, and theft rates. New drivers should opt for vehicles that are inexpensive to repair, have strong safety ratings, and are considered low-risk by insurers.
Sedans, compact cars, and older models with modern safety features like airbags and anti-lock brakes typically have lower insurance premiums. Avoiding sports cars, luxury vehicles, or cars with high horsepower will also help keep insurance costs down.
See Also: How to Lower Car Insurance Premiums After an Accident
2. Consider Usage-Based Insurance (UBI)
Usage-based insurance (UBI) can be an affordable option for new drivers with no experience. These insurance programs use telematics technology to monitor driving behavior and offer discounts based on safe driving habits. Companies like Progressive’s Snapshot, Allstate’s Drivewise, and Nationwide’s SmartRide use a small device or mobile app to track things like mileage, speed, braking, and time of day driving.
New drivers who drive safely can see significant reductions in their premiums. This type of insurance rewards good driving behavior and is ideal for new drivers who want to prove their reliability and earn lower rates.
3. Enroll in a Defensive Driving Course
Completing a defensive driving course can be a great way for new drivers to reduce their insurance premiums. Many insurance companies offer discounts for new drivers who take state-approved defensive driving courses. These courses teach drivers how to avoid accidents and improve their skills on the road, making them less risky to insure.
Not only will this help you qualify for discounts, but it can also make you a safer, more confident driver—two things that can positively impact your insurance premiums over time.
4. Bundle Your Insurance Policies
If you live with your parents or share a household with other insured drivers, you might be able to bundle your policies to save money. Many insurers offer discounts for bundling auto insurance with other types of coverage, such as home or renters insurance.
For new drivers, it’s often cheaper to remain on a parent or guardian’s policy rather than getting an individual policy. Family plans can include multi-car discounts, which can significantly lower the cost of insuring a vehicle for a new driver.
5. Maintain a Good Credit Score
Though new drivers may not have an extensive credit history, it’s essential to maintain a good credit score as it can impact your insurance premiums. Many insurance companies use credit-based insurance scores to determine the likelihood of a policyholder filing a claim. Drivers with better credit scores tend to receive lower premiums.
If you’re new to driving and insurance, start by keeping your bills paid on time, managing debt responsibly, and avoiding unnecessary credit inquiries. Over time, improving your credit score can result in lower insurance costs.
6. Opt for Higher Deductibles
A higher deductible can help lower your car insurance premiums. The deductible is the amount you pay out-of-pocket before your insurance company covers the rest in the event of a claim. By choosing a higher deductible, you’ll be accepting more risk on your end, but you’ll enjoy lower monthly or annual premiums.
However, before opting for a high deductible, make sure you have enough savings to cover the deductible if you ever need to file a claim. This strategy works well for drivers who have a solid financial cushion and don’t anticipate needing to file claims frequently.
7. Look for Good Student Discounts
If you’re a new driver who’s also a student, many insurance companies offer good student discounts as an incentive. Insurers generally provide these discounts to high school and college students who maintain a GPA of 3.0 or higher.
This discount can significantly reduce your premium, with some companies offering up to 25% off for good students. Maintaining strong academic performance is an easy way for new drivers to earn cheaper car insurance.
8. Shop Around for Quotes
One of the most important steps new drivers can take to find cheap car insurance is to shop around and compare quotes from different insurance providers. Rates can vary widely between companies, even for the same level of coverage. By obtaining multiple quotes, you can compare prices and coverage options to ensure you’re getting the best deal.
When comparing quotes, make sure you’re looking at similar coverage levels, deductibles, and terms. Some insurers specialize in offering affordable rates for new drivers, so it’s worth exploring multiple options.
9. Take Advantage of Low-Mileage Discounts
If you don’t drive frequently, you may qualify for a low-mileage discount. Insurance companies often provide discounts to drivers who drive fewer miles each year, as less time on the road reduces the likelihood of accidents.
If you primarily use your car for short commutes or occasional trips, ask your insurer about low-mileage discounts. This can be especially beneficial for new drivers who may not be using their car as often as more experienced drivers.
10. Join a Parent’s Policy
For new drivers living at home, joining a parent or guardian’s policy is often much cheaper than getting your own. Insurers typically offer better rates on family policies, and adding a new driver to an existing policy can be less expensive than starting from scratch.
Parents with a good driving history and credit score can help their new drivers save money by adding them to the household policy. Additionally, multi-car discounts may apply if more than one vehicle is insured under the same policy.
Best Insurance Companies for New Drivers
While finding affordable car insurance as a new driver can be challenging, some insurance companies are known for offering competitive rates and discounts tailored to this demographic. Here are some of the best companies for new drivers:
1. Geico
Geico is well-known for providing affordable insurance for new drivers, especially through their various discounts like the good student discount and defensive driving course discounts. Geico also offers a user-friendly mobile app, making it easy for new drivers to manage their policy.
2. State Farm
State Farm is another top choice for new drivers. Their Steer Clear program is designed to help young drivers improve their driving skills and earn a discount. Additionally, they offer a variety of discounts that can help new drivers lower their premiums.
3. Progressive
Progressive’s Snapshot program is ideal for new drivers looking to save money based on their driving habits. With usage-based insurance, new drivers can earn lower rates by demonstrating safe driving practices. Progressive is also known for its competitive rates and flexible coverage options.
4. Allstate
Allstate offers a Smart Student discount that benefits new drivers who excel academically. Their Drivewise program, which tracks driving behavior, can also help new drivers lower their rates by promoting safe driving habits.
5. Nationwide
Nationwide offers the SmartRide program, which rewards new drivers for good driving behavior with discounts. They also offer good student discounts and family bundling options, making them a solid choice for new drivers seeking affordable coverage.
Read More: Best Affordable Car Insurance for Young Drivers
Conclusion
While new drivers with no experience often face higher car insurance premiums, there are many strategies available to reduce costs. By choosing the right vehicle, considering usage-based insurance, taking advantage of discounts, and shopping around for quotes, new drivers can find affordable coverage that meets their needs.
Insurance may be expensive at first, but over time, as new drivers build a clean driving record and demonstrate safe habits, their premiums will decrease. The key to finding cheap car insurance is persistence and exploring every opportunity to save.