Best Cheap Car Insurance for 21-Year-Olds

Cheapest car insurance for 21-year-olds

Erie, Travelers and USAA have the cheapest car insurance for 21-year-olds.

At $76 a month, Erie has the cheapest liability insurance, or minimum coverage. Travelers has the cheapest full coverage for most 21-year-olds at $186 a month.

USAA is cheaper than Travelers, but it’s only available to the military community.

Key insight

Your actual rate depends on things like your driving record, location and vehicle. Companies treat these factors differently and have different car insurance discounts.

You can find the cheapest company for your situation by comparing car insurance quotes.

Cheap insurance for 21-year-olds

Company		Liability only	Full coverage	LendingTree score
	Erie	$76	$233
	Travelers	$92	$186
	American Family	$92	$247
	State Farm	$104	$232
	Progressive	$109	$257
	Auto-Owners	$110	$239
	Geico	$111	$266
	Country Financial	$113	$231
	Farm Bureau	$128	$334
	AAA	$149	$324
	Nationwide	$166	$344
	Farmers	$210	$399
	Allstate	$224	$475
	USAA*	$80	$205

Cheapest car insurance for parents with a 21-year-old

Travelers has the cheapest car insurance for most parents with a 21-year-old on their policy. Its full coverage rate for a parent with a 21-year-old on their policy averages $267 a month. This works out to $134 a month per driver.

State Farm and Progressive are the next-cheapest companies, each charging about $160 per driver per month.

Cheap insurance for a 21-year-old and parent

Best car insurance for 21-year-olds

Erie, Travelers and State Farm are the best car insurance companies for 21-year-olds. Erie is best overall based on its rates and coverage options. Erie also has a better satisfaction rating than most other companies from J.D. Power , which means it generally has happier customers.

Travelers is the cheapest large company for most 21-year-olds. It has an excellent complaint rating from the National Association of Insurance Commissioners , or NAIC. This means it tends to be fair and prompt with claims.

Along with low rates and good ratings, State Farm has the best discounts for 21-year-olds. These include a discount for completing its Steer Clear training program.

Insurance company ratings

Company	J.D. Power score	NAIC rating	LendingTree score
AAA	652	1.0
Allstate	635	0.7
American Family	640	0.4
Auto-Owners	638	0.5
Country Financial	659	0.2
Erie	703	0.8
Farm Bureau	645	0.3
Farmers	622	1.3
Geico	645	0.8
Nationwide	645	0.7
Progressive	621	0.6
State Farm	650	0.8
Travelers	613	0.5
USAA*	735	1.0

Best overall for 21-year-olds: Erie

Average liability rate: $76 a month
Average full coverage: $233 a month
Complaint rating: 0.8 (Good)
Satisfaction score: 703 (Excellent)

LendingTree score:

Low rates are not the only reason to get a car insurance quote from Erie. The company also has a higher satisfaction rating than most other companies, which generally means good customer service. Erie works with independent insurance agents . Unfortunately, it’s only available in 12 states and the District of Columbia.

Erie’s coverage options include perks you can’t get from every other company. These include free accident forgiveness if you avoid claims for three years. Other companies charge extra for it. Erie also offers pet injury coverage .

PROS

• Cheapest liability rates for 21-year-olds
• Excellent customer satisfaction
• Offers perks most others don’t have

CONS

• Only available in 12 states and D.C.
• Not as cheap for young adults on parent’s policy

Best large company: Travelers

Average liability rate: $92 a month
Average full coverage: $186 a month
Complaint rating: 613 (Below average)
Satisfaction score: 0.5 (Excellent)

LendingTree score:

Travelers’ low rates and widespread availability makes it a good choice for most 21-year-old drivers. It has cheaper full coverage than Erie, and its liability rates are only slightly higher. Its excellent complaint rating makes up for its below-average customer satisfaction score. 

Like Erie, Travelers is available through independent agents. If both companies are in your area, many independent agents can get you quotes from each one. Travelers offers extras like gap insurance and coverage for rideshare drivers , if you need them. If you want accident forgiveness, you have to pay extra.

PROS

• Cheapest full coverage for 21-year-olds
• Cheap for 21-year-olds on parent’s policy
• Excellent complaint rating

CONS

• Below-average customer satisfaction
• Doesn’t have free accident forgiveness like Erie

Best discounts for 21-year-olds: State Farm

Average liability rate: $104 a month
Average full coverage: $232 a month
Complaint rating: 0.8 (Good)
Satisfaction score: 650 (Good)

LendingTree score:

Several discounts can help make State Farm’s low rates for 21-year-olds more affordable. This includes a discount for completing its Steer Clear driver training program. You need three years of incident-free driving to qualify.

Like other companies, State Farm also gives 21-year-old students a discount for getting good grades. Parents get a discount if a 21-year-old on their policy is in college without a car. You can also save by driving safely with State Farm’s Drive Safe & Save app. Unlike some competitor programs, State Farm’s app doesn’t raise your rate for unsafe driving.

State Farm does not work with independent agents. You can get quotes from its website or one of its exclusive agents.

PROS

• Below-average rates for 21-year-olds
• Discounts make its rates cheaper
• Good customer service ratings

CONS

• Erie and Travelers are cheaper before discounts
• Erie has a better satisfaction rating

How much is car insurance for 21-year-olds?

Car insurance for 21-year-olds costs $135 a month for liability policies, on average. Full coverage costs an average of $298 a month.

Drivers in their early 20s are still gaining driving experience. This is one of the reasons they have the second-highest crash rates, behind teens, according to the National Safety Council.

Higher crash rates generally translate into higher auto insurance rates. For example, 21-year-olds pay an average of 56% more for liability insurance than 30-year-olds.

Car insurance rates by age

Insurance rates for 21-year-olds by gender

Young women tend to have lower crash rates than young men. This is one of the main reasons 21-year-old women pay 10% less than men for full coverage car insurance. For liability coverage, women pay 6% less than men.

Insurance rates for women vs. men

Car insurance costs for parents with a 21-year-old

Twenty-one-year-olds usually get car insurance for less on a parent’s policy than they do on their own. It costs an average of $246 a month to add a 21-year-old to a parent’s full coverage policy. This is 17% less than the rate of $198 a month for a 21-year-old on their own.

Young adults on their own vs. with a parent

If you’re 21, you can usually stay on your parent’s car insurance if you live with them. You can also stay on your parent’s car insurance if you’re in college. You usually need your own car insurance if you live on your own, unless a parent owns or co-owns your vehicle.

The rules on this vary by insurance company. It’s good to ask about your options when you get your quotes.

Best car insurance discounts for 21-year-olds

The high price of car insurance for 21-year-olds makes it important to find car insurance discounts. You usually get the most savings by bundling policies, joining a safe-driving program and getting good grades. It’s good to ask about these and other discounts when you get your quotes.

Bundling

Most companies offer a generous discount for bundling, or getting your car insurance with a home or renters policy. It’s good to get quotes for the entire bundle when you shop.

Safe driving apps

You can often score a big discount by signing up for usage-based insurance. Programs like State Farm’s Drive Safe & Save and Progressive’s Snapshot use smartphone apps to monitor your driving. You get a discount just for signing up. If you drive safely enough, you get another discount each time you renew.

It may feel weird to be monitored while you drive, but the savings can be significant. It’s good to read the fine print. Some app programs raise your rate for unsafe driving, unless you opt out in time.

Good students

Most companies offer a good-student discount to 21-year-olds with good grades. You usually need a B average, but some companies, such as Allstate, accept a B-.

The amount you save will depend on the company. For example, good students can save up to 15% with Geico. The savings from Progressive’s good-student discounts only start at 5%.

Away at school discount

Parents can often get a discount if a 21-year-old on their policy is away at school without a car. This is a good way to keep a young adult insured while driving borrowed cars. Some companies require the school to be at least 100 miles from home to qualify.