Car insurance for young drivers can be expensive as they’re generally considered higher risk by insurers. As with all types of car insurance, shopping around for quotes, comparing rates, and knowing how to get the most out of discounts and affiliations will help you get the coverage you need for a price you can afford. While a college student budget may make it tempting to choose the cheapest car insurance possible, price shouldn’t be the only determining factor as it’s important to have enough coverage for your situation.
When shopping for car insurance for students, it’s essential to understand what types of coverage are important and what are the minimum requirements set by your state.
Most states require all drivers, including students, to have minimum requirements set by your state, which states the maximum amount the insurer will pay for medical bills and property damage in the event you’re determined at-fault for the accident. Some states have other requirements, including personal injury protection, MedPay, and uninsured/underinsured motorist coverage.
In addition to your specific state’s minimum requirements, you may also consider some or all of the components of full coverage:
- Uninsured/underinsured motorist coverage
- MedPay/Personal Injury Protection
When it comes to price and coverage, not all car insurance policies are the same. In fact, you could get the same price with very different coverage, or the same coverage for very different prices. Your premium is based on a number of factors that each provider ranks slightly differently, such as your age, driving record, credit score, coverage needed, etc.
Before choosing a student car insurance policy, it is crucial that you compare. So, how do you compare car insurance quotes? Decide on the coverage that’s right for you and get quotes from several different insurers for the exact same coverage to see which provider will offer the best price for your situation. It’s important to understand that choosing the cheapest car insurance for college students is not always the wisest. In fact, it may cost you more in the long run, depending on the coverage (or lack thereof) that is part of your policy.
Discounts are a great way to save money on your insurance, so be aware of what’s available from each provider. Keep in mind that more discounts don’t necessarily mean the cheapest insurance if coverage is more expensive to begin with. Some commonly available discounts for college students include:
- Student away discount: If you’re at a school far away from home (usually 100 miles or more) without a car, you may qualify for a significant discount.
- Safe driver discount: Younger drivers who complete driver training courses can receive a discount as it helps prove you’re a safe driver.
- Good student discount: Maintaining high grades can also earn you a discount, as it demonstrates that you’re a responsible student.
- Military discount: Many car insurance companies offer discounts for active or retired military.
- Young driver discount: Some insurers, like Erie, actually offer a specific discount for unmarried drivers under 21 still living at home.
- Young volunteer discount: Logging a certain number of hours volunteering for a non-profit can also earn you a discount on your policy
Another opportunity for discounted student car insurance involves car tracking devices. Some insurance companies offer a device to put in your car that will monitor your driving habits. Assuming you are a safe driver, you may receive a discount (although read the terms, because some providers can raise your premiums based on unsafe driving).
While tracking devices can be a discount with standard providers, new digital insurance companies use tracking devices to offer unique coverage options and can base your premium primarily, or solely, on this data. For example, Root defines your premiums according to your proven safe driving record, while MetroMile offers low-mileage policies based on tracking.
A simple way to get cheaper car insurance for students is to take advantage of discounts for being a member of certain societies. Many car insurance companies offer discounts to alumni groups, fraternities, sororities, professional organizations and other groups. It’s worth looking into if you’re involved at your school.
When you’re comparing rates of different policies from various companies, you should also consider staying on your parents’ insurance policy versus getting your own insurance.
If you share a car with at least one family member, it can make financial sense to stay on your parents’ insurance policy. Staying on your parents’ insurance may also give you access to more discounts. If you’re able to add your student-specific discounts to their existing discounts, like multi-policy, homeowner, and loyalty discounts, it may cost less than you think to be added to their policy. Plus, if you’re adding your own car to their policy, there’s probably a multi-car discount up for grabs, too.
On the other hand, depending on your family’s insurance provider, the cost of adding you to your parents’ plan might actually be more than simply getting your own plan. Every insurer ways certain factors differently, and some may demand higher premiums for younger drivers than others. It’s also important to consider the other drivers on your parents’ policy. If another family member has an accident record, they may drive up the family premium and you may be better off on your own policy.