Finding car insurance as a new driver in the USA can be a real challenge. Whether it’s a teenager who just got their license, a young adult starting to drive, or someone who’s new to the country, new drivers often have to deal with higher prices. That’s because insurance companies aren’t sure how safe a new driver will be since they don’t have much experience on the road. Usually, a new driver might need to pay anywhere from $3,500 to $5,000 a year for their own plan, which is a lot more than the $1,765 an experienced driver might pay for full coverage. But there are ways to find plans that don’t cost a fortune while still keeping the driver protected. This guide looks at some of the best insurance options for new drivers in 2025, how much they cost in different states, and tips to save money without missing out on coverage.
Why New Drivers Pay More for Insurance
Insurance companies often charge new drivers more because they see them as a bigger risk. Without years of safe driving to show, there’s a higher chance of accidents, especially for younger folks under 25. For example, a teenager might need to pay around $4,500 a year for their own insurance plan, but if they join their parents’ policy, it could drop to something like $2,000 or $3,000. The state where the driver lives can make a big difference—big cities with lots of traffic usually mean higher rates compared to small towns with quieter roads. The kind of car being driven also matters; a brand-new sports car will cost more to insure than a basic, older sedan. Knowing these things can help new drivers pick a plan that fits their budget.
Top 5 Car Insurance Plans for New Drivers in 2025
Geico is a popular choice for new drivers because it’s often one of the cheapest options, and it’s available everywhere in the USA. A full coverage plan might cost around $2,172 for the year, but if a new driver gets added to a family plan, that could go down to about $1,200. Geico covers damages from accidents, theft, or things like floods, plus liability if the driver causes damage to someone else, and even roadside help if the car breaks down. There are ways to save money, like getting 15% off for keeping a B average in school, another 10% for taking a defensive driving course, or extra savings by insuring more than one car. Geico has an app that makes it easy to manage payments or deal with claims, which can be a big help for someone new to all this.
State Farm is another good option, especially for teenagers or anyone joining a family policy. A family plan might cost around $2,196 for the year, which works out to about $183 a month. For a driver under 25 getting their own plan, it’s more like $3,312 a year. State Farm covers accidents, rental cars if the vehicle needs to be fixed, roadside assistance, and liability for damages caused to others. They have a program called Steer Clear for drivers under 25, which offers training to help them drive better and gives discounts for finishing it. Good students with a GPA of 3.0 or higher can save 25%, and safe driving can cut the cost by 15%. State Farm has agents in most places, so it’s easy to get help in person if that’s what the driver prefers.
Nationwide can be a smart choice for new drivers who don’t use their car a lot, like students or people in cities who often take the bus or train. A standalone plan might cost $2,138 a year, while a family plan averages $2,178. Nationwide has a pay-per-mile option called SmartMiles, which charges based on how much the car is used, making it perfect for those who don’t drive often. They also have SmartRide, which tracks driving habits and can save up to 40% for careful drivers. Coverage includes accidents, theft, and other damages, plus a feature that lowers the deductible the longer the driver goes without an accident. Adding another policy, like renters insurance, can save 10% on the bill.
USAA is a great choice for military families, but it’s only available to military members, veterans, or their families. A standalone plan costs about $1,692 a year, or roughly $141 a month, while a family plan with a teen driver might be $3,840 a year. USAA covers accidents, new car replacement, roadside assistance, and rental cars, along with some options tailored for military needs. Discounts include 15% off for parking on a military base and 10% for safe driving. USAA is known for excellent customer service and low rates, making it a top pick for those who qualify.
Erie Insurance is worth checking out for new drivers in the 12 states where it’s offered, like Pennsylvania, Ohio, or Virginia. Teens might pay $1,532 a year, while young adults pay around $2,000. Erie covers accidents, theft, and liability, plus offers features like rates that stay the same unless the policy changes, forgiveness for a first accident after three years, and protection for new cars. Savings include 20% off for insuring multiple cars and 10% for safe driving. Paying the yearly bill upfront instead of monthly can also lower the cost. Erie isn’t as big as some other companies, but it’s known for good customer service.
How Much Does Insurance Cost for New Drivers? (2025 State-by-State Breakdown)
The cost of insurance can be very different depending on the state. In Maine, new drivers might pay as little as $660 a year, which is one of the cheapest rates in the country. Hawaii is also affordable at $855, and Idaho averages $990. But in Michigan, the cost can be as high as $2,998 a year because of laws that require extra coverage. Louisiana is another pricey state at $2,689, and Florida averages $2,560. Across the country, new drivers usually pay $3,500 to $5,000 for their own plan, but joining a family plan can bring that down to $2,000 to $3,000. These differences come from things like how busy the roads are, what coverage the state requires, and how much repairs cost in that area. For example, Michigan’s high rates are because drivers must have unlimited personal injury protection, while Maine’s quieter roads mean fewer accidents and lower costs.
How to Save Money as a New Driver
There are several ways to keep insurance costs down while still getting good coverage. One of the easiest is to join a family policy, like a parent’s or spouse’s plan, which can lower the bill by 30-50%. Instead of paying $4,500 a year for a solo plan, a new driver might pay $2,500 on a family plan. Many companies offer discounts that can help—25% off for good grades with a GPA of 3.0 or higher, 10-15% for completing a driver’s education course, and up to 40% for safe driving if the company tracks habits through an app. Choosing a higher deductible, like $1,000 or $1,500, can reduce monthly payments, though it means paying more if a claim is needed. Driving a safe car, such as a Honda Civic or Toyota Corolla, can lead to lower rates because these models are cheaper to fix and have good safety ratings. Getting quotes from different companies online, using tools from Geico, Progressive, or comparison sites like The Zebra, can save a lot of money. For drivers with a paid-off car, going with basic liability coverage instead of full coverage can also keep costs low, though it won’t cover damage to their own vehicle if they’re at fault.
Comparing Coverage Types for New Drivers
Knowing the different types of coverage can help new drivers decide what they need. Liability-only coverage is the cheapest, starting at $500 to $1,000 a year, and pays for damage caused to others in an accident. But it doesn’t cover the driver’s own car if they’re at fault. Full coverage, which includes collision and comprehensive, costs $2,000 to $5,000 a year but protects the driver’s car too. Collision covers accident damage, while comprehensive handles things like theft or damage from storms. Drivers can add extras like roadside assistance for $10-$20 a month or rental car coverage for $5-$15 a month, but these will increase the cost. Those with financed or leased cars are usually required to have full coverage, while those with older cars might choose liability to save money. Uninsured motorist protection is another option—it covers damages if someone without insurance hits the car, which can be helpful in states where many drivers don’t have coverage.
Real-World Examples: What New Drivers Pay
Here are some examples of what new drivers are paying to give a better idea of costs. A 17-year-old in Texas with a 2023 Toyota Camry on a family Geico policy pays $2,300 a year, thanks to a discount for good grades. A 23-year-old in California with a 2018 Honda Civic has a Nationwide policy for $2,100 a year, using the pay-per-mile option since they don’t drive often. A 19-year-old in New York on an Erie family policy with a 2020 Ford Escape pays $1,800 a year with a multi-car discount. A 20-year-old in Florida with a 2019 Hyundai Tucson on a State Farm family plan pays $2,500 a year, taking advantage of the Steer Clear program. A 22-year-old military member in Virginia with a 2021 Jeep Wrangler on USAA pays $1,500 a year with a military discount. Costs depend on the car, the state, and the driver’s record—staying accident-free helps keep rates low over time.
Which Insurance Is the Best Fit for New Drivers?
Picking the right insurance depends on what the driver needs. Geico is a good all-around option with low rates, availability in every state, and an easy app for managing everything. State Farm works well for families, offering affordable plans when adding a teen and training programs to help new drivers improve. Nationwide is ideal for those who don’t drive much, with its pay-per-mile option that saves money for low-mileage drivers. USAA is the top choice for military families who qualify, with some of the best rates and customer service. Erie is a strong pick for drivers in its 12-state area, offering low prices and unique features like locked-in rates. Getting quotes from a few of these companies can help find the best deal for any new driver’s situation.
Final Tips for New Drivers
Start by getting quotes from at least three companies, as costs can vary a lot based on age, location, and the type of car. Bundling auto insurance with another policy, like renters insurance, can lead to extra savings. Taking advantage of discounts, such as those for good grades or safe driving, can lower the bill significantly. Drivers should also consider using apps that track driving habits to prove they’re responsible, which can lead to bigger discounts over time. Keeping a clean driving record by avoiding tickets and accidents will help rates go down as more experience is gained. Switching companies if a better deal comes up is another way to save—sometimes newer customers get better rates than loyal ones. With the right plan, new drivers can feel secure on the road in 2025 without spending more than necessary
