Millennials and Auto Insurance

A comprehensive study of auto insurance for millennials based on an analysis of 55 million sample rates spread across 34,500 ZIP codes in all 50 states.

Explore highlights below, or …

Why Millennials?

Higher rates and a willingness to research new options make millennials savvier insurance shoppers.

Our study takes a deep dive into millennial auto insurance rates.

It shows how factors like age, living arrangements, location, and credit — things that are top of mind for many in their 20s and 30s — can have a big impact on auto insurance rates.

Are you between the ages of 23 and 38?

Use this guide to understand the individual factors that influence your rates, how much they matter, and what to focus on if you want to pay less for auto insurance.

Are you in the insurance business?

Use this guide as an educational tool for new and prospective clients looking for the best rates. You are free to reuse this guide, in whole or parts provided that you reference to Reviews.com as the original source.

Savvy Shoppers

“Millennials grew up with easy access to information. They are researchers by nature. When you combine this trait with generally less financial resources compared to prior generations, you get a very savvy shopper that is focused on value. And when value isn’t provided, millennials are very willing to try the next best thing in search for it.”

Kyle Schmitt, J.D. Power Managing Director of Insurance Intelligence

Age + Gender

As a group, millennials are younger than about 60% of drivers (1).

Which leads to higher premiums on average. Young men also pay more for auto insurance than women in almost every state. However, insurance rates and the gender rate gap start to level off around age 30.

Fresh Finds

Millennials in their early 20s usually pay the most for auto insurance. These insurers showed the best value for our 23-year-old sample driver:

Erie Insurance $1,084
USAA $1,364
Geico $1,214
Travelers $1,317
State Farm $1,321

Insurers included above are among the top 20 companies by market share in 5 or more states.

Location

When millennials decide to move, cost of living is a big consideration

Here’s how auto insurance rates stack up in the 10 most popular cities for millennial movers (2):

Durham, NC $842
Madison, WI $1,107
Seattle, WA $1,402
Omaha, NE $1,405
Oklahoma City, OK $1,498
El Paso, TX $1,516
Salt Lake City, UT $1,581
Denver, CO $1,670
Bakersfield, CA $1,716
Grand Rapids, MI $2,702

Remember: Prices vary by state, and it’s almost always more expensive to insure your car in big cities than in rural areas.

car_move

How does your state’s average yearly rate compare?

Power Moves

Always check auto insurance rates after a big move; your current company might not be cheapest anymore. Here’s how much prices varied by state for the five biggest insurers in the U.S.:

State Farm $767 – $3,540
Geico $552 – $1,983
Progressive $563 – $3,060
Allstate $1,177 – $6,537
USAA $524 – $1,577

Living Arrangement

Major life events many millennials are currently facing, like marriage and home ownership, can also impact auto insurance rates.

Couples pay LESS than singles

6%

(on average)

States with the biggest savings for millennial couples:
1. Mississippi 10%
2. Georgia 9.1%
3. Kentucky 8.9%
4. Alabama 8.8%
5. Alaska 8.4%
1.5%

(on average)

Homeowners pay LESS than renters

States with the biggest savings for homeowners:
1. Michigan 3.8%
2. Hawaii 3.4%
3. Florida 3.0%
4. New Mexico 2.9%
5. Colorado 2.7%

Savings for homeowners do not include bundling discounts. Auto insurance customers can generally save more by insuring their vehicle and home with the same company.

Financial Health

Millennials have lower average credit scores than older generations (3), which can contribute to higher auto insurance rates.

Extra Credit

In our study, these companies showed the most competitive rates for drivers with a credit score of “fair”:

Travelers $478
Farmers $507
Nodak Mutual $508
North Carolina Farm Bureau $599
National General $603

Driving Habits

Accidents and infractions raise prices by
a wider margin for younger millennials

Speeding Ticket

25%
(Average increase)

early 20s


$510

late 20s


$432

30s


$396

Distracted Driving

24%
(Average increase)

early 20s


$484

late 20s


$408

30s


$374

Small Accident

51%
(Average increase)

early 20s


$1,052

late 20s


$878

30s


$804

DUI

94%
(Average increase)

early 20s


$1,972

late 20s


$1,625

30s


$1,484

Risky Business

Some insurers are friendlier toward “high-risk” drivers. In our evaluation, these companies were most affordable for drivers with an accident and a speeding ticket on record:

Nodak Mutual $542
Erie Insurance $708
Concord Mutual $777
USAA $861
North Carolina Farm Bureau $866

Average rate increases based on a state minimum liability coverage plan. Insurers included above are among the top 20 companies by market share in five or more states.

Vehicle + Coverage

Your vehicle and the coverage you choose to protect
it will always have a big impact on premiums.

Here’s how much it costs to insure the most popular vehicles of 2017-2018 (4):

Sample vehicle rates based on a 23-year-old driver carrying 50/100/25 liability coverage without collision and comprehensive.

Pricier vehicles can increase rates up to

12%
Adding collision and comprehensive (with a $500 deductible) raises rates by 130% on average:

On average, increasing liability limits raises rates by

10-15%

A Better Deal

“Perhaps the biggest shift in behavior among millennials versus prior generations is the way they treat services like auto insurance as a consumer product. If an auto insurer can’t meet millennials’ expectations, they will look elsewhere. Consumer products have been dealing with this behavior for decades. Now it is time for auto insurers to get on board.”

Kyle Schmitt, J.D. Power Managing Director of Insurance Intelligence

Compare Auto Insurance Companies

See how the 15 most popular auto insurers nationwide (5) stack up for millennial drivers based on price and customer satisfaction.

Average rates from Reviews.com and Quadrant Information Services are compared side-by-side with satisfaction scores for customers age 23–38 provided by J.D. Power Rating Services. J.D. Power surveys insurance customers to collect satisfaction scores based on policy offerings, price, billing, customer service, and claims satisfaction. Scores are out of 1,000.

*Satisfaction score from JD Power.
** The Kemper Group includes ALFA INSURANCE, ALLIANCE UNITED, and INFINITY
*** Comparative rate data from Liberty Mutual is not currently available through Quadrant.

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Methodology

To collect comprehensive data on auto insurance prices for millennials, we worked with Quadrant Information Services, the leading authority on insurance rate analytics. Quadrant provides this information through rating data insurers are required to file with state departments. Our report analyzes sample rates from more than 34,000 ZIP codes spread across all 50 states, and includes the 5-10 biggest insurers in every state by market share.

For the purpose of this study, we define “millennial” as anyone born between 1980 and 1996 (as of 2019, that includes drivers between 23 and 38 years old).

Rates shown here are based on profiles for both male and female drivers aged 23, 27, 31, and 35 years. To find average rates for each age group, provider, and state, we used a base profile with a clean driving record and credit tier of “good.” Rates are for a 2017 Toyota Camry LE, one of the most popular cars in the U.S. according to Kelley Blue Book (KBB), with an annual mileage of 15,000.

We also tested six coverage plans with our base profile, including state minimum liability coverage, 50/100/25 liability coverage, and 100/300/50 liability coverage. We tested each liability level with and without collision and comprehensive coverage set at a $500 deductible. Averages are weighted for 77% of drivers with collision and comprehensive and 23% of drivers without, based on the Insurance Information Institute’s estimate of how many drivers carry these coverages.

Using these base profiles, we tested rates for a variety of infractions and demographic factors that can affect auto insurance premiums. We looked at rates for drivers with an accident totaling $3,500 property damage, an accident totaling $10,000 property damage, a speeding ticket, a DUI, or a distracted driving ticket on record, as well as a combined accident and speeding ticket on record.

We considered rates for renters, homeowners, single drivers, and married drivers, as well as credit tiers of “fair,” “good,” and “excellent.” We compared prices for the 2017 and 2018 Toyota Camry, along with the 2017 and 2018 Toyota RAV4, Ford F-150, BMW 3-series, and Ford Fusion Energi. These were among the most popular sedans, trucks, SUVs, luxury vehicles, and hybrids from both years according to KBB data.

Rates resulting from this study are estimates meant only for informational and comparative purposes. You own rates will vary.

Sources

¹ Highway Statistics Series.” U.S. Department of Transportation/Federal Highway Administration, 1 Apr. 2019, www.fhwa.dot.gov/policyinformation/statistics/2010/dl20.cfm.

² “Most Popular Areas for Millennials: Where They Move and Stay.” NAR, National Association of Realtors , Apr. 2019, www.nar.realtor/research-and-statistics/research-reports/most-popular-areas-for-millennials-where-they-move-and-stay.

³ Stolba, Stefan. “Millennials and Credit: The Struggle Is Real.” Experian, 4 Apr. 2019, www.experian.com/blogs/ask-experian/taking-a-look-at-millennial-credit-scores/.

⁴ “10 Best-Selling Cars of 2018…so Far.” KBB.com, Kelley Blue Book, 16 July 2018, www.kbb.com/Car-Reviews-and-News/Top-10/Best-Selling-Cars-2018/2100005607/.

⁵ “Property and Casualty Insurance Market Share Report 2019.” NAIC.org, National Association of Insurance Commissioners, 25 Mar. 2019, www.naic.org/documents/web_market_share_190304_ 2018_property_lob.pdf.