While car insurance can be expensive for some young drivers, it’s possible to find a more affordable policy. Some car insurance companies have cheaper rates than others, so it’s worth comparing rates from a few different insurers before you purchase a policy.
In this guide, we’ll reveal how much car insurance costs for a 25-year-old and explain how you can find cheap car insurance under 25.
Our rates are based on public rate filings obtained by analytics company First Interpreter. While we may partner with some of the carriers you see on our site, we maintain editorial independence and it does not affect the rates you see. Read more about our rating methodology or see our rigorous editorial policy.Â
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In general, young adults pay some of the highest rates for auto insurance. However, premiums start to come down around age 25, assuming you have a clean driving record and no recent insurance claims. Besides your age, some other factors that impact the cost of your car insurance are your location, gender, and vehicle type.
There isn’t a single car insurance company that is the best carrier for all drivers under 25 years old. The best car insurance company for you depends on your coverage requirements, your budget, and what you value in an insurance provider.
To simplify your insurance shopping journey, you can use Rate Retriever. Take our five-question quiz to see your best matches and find a car insurance policy that fits your personal insurance needs.
We’ve found that some of the most affordable insurance companies for drivers 25 and under include: Geico, Erie Insurance, American Family Insurance, and Nationwide. These companies provide affordable coverage for this demographic in large portions of the US, but you may be able to find a better deal tailored to your profile.
The average cost of car insurance for 25-year-old drivers is around $2,200 per year, which is about $183 per month. However, you might pay a higher or lower rate depending on your specific situation and driver profile.
When you apply for a car insurance policy, the insurance company looks at a variety of factors, like your ZIP code, driving record, credit score (in some states), claim history, gender, and vehicle. These factors are all used to calculate your unique premium.
In addition, studies have shown that young males typically pay higher rates than young females. The average cost of car insurance under 25 for males might be higher than the average rate for 25-year-old females.
The average cost of car insurance for drivers under 25 depends on whether the driver is on their parent’s car insurance policy or their own plan. In general, it’s much more expensive for drivers under 25 to purchase their own car insurance policy. Staying on a parent’s plan usually results in a much lower cost.
For young drivers on their own car insurance plans, the average car insurance premium also varies based on age. On average, teenagers and young adult drivers can expect to pay well over $3,000 a year for their own car insurance policy. Around age 25, the cost of car insurance comes more in line with the national average.
However, the cost of car insurance for young adults also varies based on the insurance company you choose. Based on our analysis of rate data, we found that Progressive offers the lowest rates for 25-year-olds.
In the table below, you can see the top car insurance carriers for 23-year-old drivers, so you can get an idea of some of the cheapest car insurance companies for young adults:
| Company | Average Annual Premium |
|---|---|
| USAA | 2,044 |
| Progressive | 2,247 |
| Travelers | 2,354 |
| Geico | 2,359 |
| Nationwide | 2,385 |
| Auto-Owners Insurance | 2,677 |
| State Farm | 3,274 |
| Allstate | 3,457 |
| Farmers | 3,546 |
Annual rates for a male driving a 2023 RAV4, estimated using public rate filings sourced from First Interpreter. Rates do not represent actual quotes. Accurate as of January 2024.Â
For comparison, you can see the average car insurance rates for 25-year-old drivers in each state below:
Annual rates for a male driving a 2023 RAV4, estimated using public rate filings sourced from First Interpreter. Rates do not represent actual quotes. Accurate as of January 2024.Â
If you haven’t reached your 25th birthday yet, you’ll be happy to know that car insurance premiums usually go down around that age. Most drivers will see their car insurance premiums decrease when they turn 25.
However, that doesn’t mean your rate is guaranteed to drop when you turn 25. Besides age, there are many other factors that affect the cost of your car insurance premium. If you have multiple accidents or traffic violations on your record at age 25, your car insurance rate might not get any cheaper.
Car insurance is usually cheaper at age 25 because most drivers have almost a decade of driving experience under their belts.
The main reason why young drivers pay expensive rates for auto insurance is that they are newly licensed and don’t have much driving experience. Data shows that teen drivers between the ages of 16-19 have the highest accident rates and are more likely than older drivers to make critical errors that lead to serious crashes.
By age 25, insurance companies assume that most drivers have mastered safe driving behaviors and are less likely to get into an accident. Therefore, car insurance companies start to lower auto insurance rates around this time.
Most 25-year-olds are looking for the cheapest car insurance premium for their situation. Here are a few ways to potentially save money on your policy:
Most national and local car insurance companies offer discounts, which can lower your rate. There are savings for good students, claim-free drivers, paying your premium in full, insuring multiple vehicles, having safety features in your vehicle, and many others. Every carrier offers different discounts with varying savings potential.
If you own a home or rent an apartment, you might be a good candidate for a bundling discount. When you purchase an auto and property insurance policy from the same insurance company, you can usually get a significant discount on your combined premium.
In general, safe drivers pay the lowest car insurance rates. Maintaining a clean driving record and avoiding tickets and accidents can help you lock in the most affordable car insurance premium.
If you have car insurance policies that require a deductible, like collision insurance, consider choosing a higher deductible to get a lower premium. The higher your deductible is, the lower your premium will be.
Comparing personalized rates from several car insurance companies will help you find the cheapest policy for your situation. You should also compare new rates every few years to make sure you’re still getting the best price.
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Rate Retriever rates are based on public rate filings obtained by analytics company First Interpreter. This data comes from the rating plans insurance carriers submit to each state’s department of insurance. Rating plans detail how each carrier calculates premiums using factors such as location, age, gender, and driving record, and they ensure that insurance premiums are both fair and competitive. Â
For the data on this page, we made the following assumptions: a single male with a clean driving record and Good credit score, driving a 2023 RAV4. We adjusted this profile by age to determine the rates you see on this page.Â
These rates are not actual quotes and should be used only for comparative purposes. Your rates can vary significantly based on your unique driver profile.Â
At Rate Retriever, our mission is to make the way you shop for insurance transparent and fair through user-friendly tools that respect your privacy and deliver reliable, comprehensive results. Â
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