Best Cheap Car Insurance Companies for 25-Year-Olds (2024)

FAQs

Best Cheap Car Insurance Companies for 25-Year-Olds? ›

Does car insurance go down at 25? Usually, yes. At Progressive, rates drop by 9% on average at age 25. But there are other cost factors impacting your car insurance, such as your claims history.

Does car insurance go down at 25? Usually, yes. At Progressive, rates drop by 9% on average at age 25. But there are other cost factors impacting your car insurance, such as your claims history.

The cheapest car insurance rate is $38 a month from Geico according to our research team's cost analysis of national average prices for minimum coverage. The top 10 cheapest car insurance companies are Nationwide, Geico, State Farm, Travelers, Progressive, AAA, Allstate, Chubb, Farmers and USAA.

On average, 25-year-olds pay about $2,336 per year or $197 per month for full coverage car insurance policies. This is about 16% more than the national average for 35-year-old drivers, which is $2,008 per year.

Car insurance does get cheaper at 25 , but the percentage decrease varies a lot depending on the company. Of the largest auto insurance companies — Geico, State Farm, USAA and Progressive — USAA and Geico have cheaper rates for young drivers than Progressive or State Farm.

On average, drivers with poor credit pay 118 percent more for full coverage car insurance than those with excellent credit. California, Hawaii, Massachusetts and Michigan prohibit or limit the use of credit as a rating factor in determining auto insurance rates.

AAA insurance premiums tend to be more expensive than the national average because AAA doesn't write its own policies. Each regional club operates independently and sells insurance policies underwritten by different agencies.

Young drivers ages 16 to 24 tend to have the most expensive car insurance. Drivers in this age group are often inexperienced and are more likely to get into car accidents and file insurance claims. As a result, car insurance companies often charge higher premiums to young drivers.

Why is insurance so expensive under 25? ›

Insurance companies often see young drivers as a greater risk because they are more prone to accidents and poor decision-making — both of which raise the potential cost of claims that need to be paid out by insurers. As a result, these added risks lead to higher premiums when insuring teen drivers.

On average, auto insurance rates for 25 year olds are cheaper than rates for younger drivers. Auto insurance premiums tend to decrease as you get older, up until about age 75 when they start increasing again.

Both Geico and Progressive offer cheap car insurance to drivers across the country. Geico's rates are typically lower overall, but Progressive tends to offer better prices to high-risk drivers. High-risk drivers are those with a recent DUI, at-fault accident or speeding ticket on their driving record.

State Farm is the biggest auto insurance company in the country by market share, while Progressive, Geico and Allstate are the next three.

USAA is so cheap because the company is the largest insurer of the military community, and that volume allows USAA to offer more competitive rates. USAA has more than 6% of the total private-passenger insurance market, despite only offering coverage to service members.

Yes, car insurance goes down at 25 with Geico, since 25-year-olds are no longer considered as high-risk as younger drivers. Turning 25 years old saves drivers an average of 8.53% on a Geico policy, based on quotes for ZIP codes across the country.

Reasons that might make car insurance rates go up

Common among them are speeding tickets, DUIs, credit and moving violations. But beyond that, insurers also consider specific risks like the rates of accidents, vandalism and theft in your area, which result in higher claim rates.