As my daughters go deeper into their teen years, before I know it, they’ll be driving cars. So I wondered about the cheapest cars to insure for a teenager.
Here are the cheapest cars to insure for teenage drivers:
- Fiat 500 – MSRP $26,565 – New
- Chevy Equinox – MSRP $26,300 – New
- Honda Civic Hatchback – MSRP $23,250 to $29,850 – New
- Honda Civic LX Sedan – MSRP $22,350 – New
- Mazda3 Sport Sedan – MSRP $23,000 – Used
- Ford Fusion S Hybrid Sedan – MSRP $20,000 – Used
- Ford Fusion – MSRP $19,000 – Used
On average, insurance rates for a family adding a 3rd car and teen driver to their policy can expect rates to increase by 62%.
It’s a proud day for parents when we see our young ones graduating from high school.
That is traditionally the beginning of a new chapter of their lives. This of course also means that they are ready to drive their very own cars.
It’s important to make sure that young drivers are fully aware of the importance of driving carefully and maintaining a clean driving record – not only to ensure their own safety, others’ safety, and the safety of their vehicle and property, but also to ensure that they don’t have to deal with issues like applying for a hardship license.
Driving safe and staying out of trouble is the best way for them to stay safe and keep car insurance cost low. In this article, we’re exploring the world of teen drivers and insurance costs.
We’ll examine average car insurance rates, how much policies go up adding teens, and some crucial steps you can take to minimize the increased costs. Also be aware that due to the events of 2020, car prices and availability have changed radically. So expect to pay more and for them to be harder to find.
Specifically, we’re looking at the cheapest cars to insure for a teenager, so you can get them the best cars they’ll love with insurance costs that won’t break the bank!
After all, finding affordable insurance is a nightmare, especially when it comes to auto insurance for teens.
The following new cars are safer for teens, have a low price, AND are among the lowest cost to get insurance on. For used cars, CLICK HERE to skip down:
Cheapest New Cars to Insure for a Teenager
1. Fiat 500 – $26,565
One of the most trusted cars, the Fiat 500 is a complete car in terms of safety, reliability as well as stylish looks.
A small car, Fiat is fully equipped with the latest tech. Featuring a 5-inch infotainment touchscreen on the dashboard, Fiat is for all those who love retro and vintage cars.
Not only does it look super adorable, but it also drives very smoothly without giving any hitches. The best part? It is extremely economical and at under $30,000, it’s one of the least expensive cars to insure for teenage drivers.
That being said, this car has increased in price significantly (almost doubled) from when I first wrote this article. So do be aware that unlike 2-3 years ago, you can probably get more car for the buck by looking at others on my list.
Wondering about safety over price? Check out the absolute Safest Automobiles (click to read on this site) so you can rest easy knowing your teen is protected!
2. Chevy Equinox – $26,300
This sleek crossover SUV is perfect for your young blood.
It does not contain too many powertrains and when it comes to technology, Equinox has its limitations. However, It was one of the top picks by IIHS as a safe car.
The rearview camera allows for better visibility. Seating and airbag security are also in check. Your kid will love you for getting them this beautiful car!
3. Honda Civic Sedan – $22,350
The Honda Civic is known for its additional safety features.
This car contains a reverse camera as well as features like daytime running lights, anti-lock brakes, electronic stability control, side airbags, as well as airbags for the torso and head.
One more exciting feature is that a hands-free Bluetooth phone connection is integrated into the car’s digital dashboard control. If you opt for the hybrid model, the car will also contain front crash prevention.
So it would be much safer for your teen.
For real peace of mind, don’t forget the Always Prepared 149-Piece Roadside Assistance Emergency Kit(click to check the current price on Amazon).
It’s almost 5 stars on Amazon Prime with well over 300 less-worried parent reviews. It includes jumper cables, a first aid kit, and other crucial survival items if the unexpected happens to your child.
4. Toyota Prius – $24,625
The incredible thing about Toyota Prius is that it is an extremely eco-friendly car, as it runs not just on fuel but battery too.
Prius features electronic stability control, side airbags, driver knee airbag, and anti-lock. Since it is eco-friendly, it will allow your teen to select one of the three modes that help in improving fuel consumption.
5. Mazda 6 – $24,325
Mazda 6 is not your typical family car.
It is a sports sedan that is perfect for teenagers with raging hormones. Laced with features like electronic stability control, multiple airbags, anti-lock brakes, and daytime running lights, this reliable car also contains blind-spot monitoring and rear cross-traffic alert system.
This means that your young driver will be able to see at the front as well as at the back of the car!
Not wanting to buy a new car? For many, buying a late-model used car makes much more financial sense. So make sure you check out the crucial steps for Buying a Used Car (click to read my steps now) while avoiding the most common pitfalls.
6. Mitsubishi Outlander Sport – $22,995
Even though it is a small SUV, Mitsubishi Outlander does not lack in the safety department.
It has a driver knee airbag, rollover sensors, airbags on the front and sides, as well as electronic stability control.
It is perfect for youngsters who want an attention-grabbing SUV, as it also features a 6-inch touchscreen display, a front dual-zone climate control, and a rearview camera. This car allows for seven-passenger seating.
7. Subaru Outback – $28,395
Given the best ranking for front crash protection, Subaru Outback is the car to opt for if you are worried about your teenager’s rash driving skills.
This beauty also features electronic stability control, side airbags, a rollover sensor, and daytime running lights.
Outback has a unique feature of the EyeSight Driver Assist system that has two cameras right next to the rearview mirror so that the driver may be warned of a collision before it takes place.
This system helps the driver in keeping within the lane by automatically tapping on the brakes when the car swerves out of control. Not one of the least expensive cars to insure for teenage drivers, but certainly one of the safest.
8. Nissan Rogue S FWD – $27,360
Want something that isn’t simply safe but catches the eye too?
Then Nissan Rogue is the one you are looking for. The SUV features head curtain airbags for all the seats, electronic stability control, front seat-mounted torso airbags, and a rollover sensor.
This car is also perfect for long drives to and back from college because its front seats are designed in a way that reduces fatigue to the back and helps in improving blood circulation.
Cheapest used cars to insure for teenage drivers
Don’t want to shell out the big bucks for a brand-new car for your teen?
I get it and won’t be doing that for my girls either! I actually love what my dad did for me in high school for my first car. He said he would match me dollar for dollar any amount I could save up.
I ended up saving $700 and bought a $1,400 used Toyota Corolla.
But without further ado, here are the cheapest used cars to insure for teenage drivers. Not surprisingly, the newer versions of some of these also make the new car list.
Prices are all for 3-year-old models around 30,000 miles in great condition. The prices are courtesy of Kelly Blue Book.
As I update this article each year, these cars and prices may change.
When options were available, I selected the lowest-priced option for the listed price and in “very good” condition (lower than “excellent”). I also selected buy from a private party which is almost always less expensive.
Obviously, prices will vary based on zip code, mileage, and condition. Prices shown here are not guaranteed and are given only for a range and for informational purposes only.
1. Honda Civic LX Sedan – $25,000
The Honda Civic is known for its additional safety features.
This car contains a reverse camera as well as features like daytime running lights, anti-lock brakes, electronic stability control, side airbags, as well as airbags for the torso and head.
One more exciting feature is that a hands-free Bluetooth phone connection is integrated into the car’s digital dashboard control. If you opt for the hybrid model, the car will also contain front crash prevention.
So it would be much more safe for your teen.
2. Mazda3 Sport Sedan – $20,000
Mazda3 is not your grandpa’s sedan!.
The Mazda3 ranks in the top 50% for the compact car class. It has great engine performance, awesome safety scores, and a luxury-like interior.
3. Ford Fusion S Hybrid Sedan – $18,000
The great news about Ford Fusion is that it is very intelligent when it comes to saving up on the fuel, hence perfect for teenagers.
Some other terrific features include traction and stability control, anti-lock brakes, integrated blind spots, and optional lane departure warning.
The speed is limited to 80 mph which will keep your youngster in check when they are driving on the highway!
4. Subaru Outback – $28,000
Given the best ranking for front crash protection, Subaru Outback is the car to opt for if you are worried about your teenager’s rash driving skills.
This beauty also features electronic stability control, side airbags, rollover sensor, and daytime running lights.
Outback has a unique feature of EyeSight Driver Assist system that has two cameras right next to the rearview mirror so that the driver may be warned of a collision before it takes place.
This system helps the driver in keeping within the lane by automatically taping on the brakes when the car swerves out of control. Not one of the least expensive cars to insure for teenage drivers, but certainly one of the safest.
5. Subaru Forester 2.5i Sport Utility 4D – $28,000
The Forester has a rare perfect rating not only for head-on collisions but also for side-impact crashes from The Insurance Institute for Highway Safety.
After all, you not only want an inexpensive car for insurance for your teen, but you want a safe one too!
Additional safety features include:
- Rollover sensor
- Electronic stability control
- Driver knee airbag
6. Ford Fusion – $19,000
The great news about Ford Fusion is that it is very intelligent when it comes to saving up on the fuel, hence perfect for teenagers.
Some other terrific features include traction and stability control, anti-lock brakes, integrated blind spots, and optional lane departure warning.
The speed is limited to 80 mph which will keep your youngster in check when they are driving on the highway!
This car was discontinued by Ford in 2021, so just know that used is the only option up to 2021 unless they decide to bring it back.
Frequently Asked Questions
Why is auto insurance more expensive for teens?
Auto insurance rates are higher for teens to cover the increased losses they are more likely to incur. Teens get in over 230,000 accidents each year, and car crashes are also the leading cause of death for teens. Every accident, death, and bodily injury or property claim is lost profit for the insurance company.
(source)
Since your teenager may not have started working yet, you will likely be the one paying for all the damages.
If you’re adding a teenage driver to your auto insurance, the rates will be going up. It’s the perfect time to review your coverage and compare rates with multiple companies.
How can a 17-year-old reduce car insurance?
A 17-year-old driver can reduce their auto insurance rates by adding themselves to their parent’s policy rather than getting their own, taking a defensive driving course, get better grades at school, drive a more sensible, less flashy car, and go longer periods of time in between moving violation tickets and incidents.
In some ways, expensive auto insurance for teens just goes with the territory.
Parents and teens have been dealing with this since the invention of the automobile. After all, as I mentioned above, car crashes are the leading cause of death for teens, and every year, teens get in over 230,000 car accidents.
Ultimately it’s the insurance company that has to pay out damages, medical bills, and lawsuits resulting from those things. So they offset those losses by making assumptions about all teens and driving.
Unfortunately, that assumption is that teens don’t drive well, aren’t very safe, engage in risky behavior, and are more likely to cause an accident. All of that adds up to higher costs of insurance.
However, it’s not all bad news and there ARE some things you can do to cut the cost of insurance for a 17-year-old or any teenage driver, such as:
- Take a defensive driving course – I’m used to doing this for speeding tickets, but generally, your insurance company will give a discount for taking this course. Just check with them first as they may require certain providers. Many classes these days are done online which your teen will appreciate
- Keep the grades up – Yup, most insurance companies reward drivers under age 25 if they have a B average (in high school) or a GPA of 3.0 (in college). They figure if they’re crackin’ the books, they’re not crackin’ the beers! This is called the Good Student Discount.
- Keep driving safe – It goes without saying for all of us that the longer we go without an accident or claim, the cheaper our insurance will get. So keep driving safe and don’t file minor, more frivolous claims
- Rethink the frat parties – It might surprise you, but some companies such as Geico, actually give discounts for college students who are members of certain fraternities and sororities
- Don’t drive a flashy car – It makes sense. But if you buy your 17-year-old a red Corvette, you can bet the insurance company is going to charge you more than if you bought them a late-model baby blue Hyundai. So vehicle types can make a huge difference with your ability to find cheap car insurance.
- Buy a beater and only get liability coverage – It (hopefully) goes without saying that your child’s first car doesn’t need to be a Lamborgini. In fact, my first car was a 1971 Toyota Corolla. That kind of car doesn’t really need comprehensive and collision coverage as you’ll likely spend more in a year than the car is worth. So buy an inexpensive used car and just get liability coverage to save a ton!
Feel at ease with your new teenager on the road. Teens are eligible for California’s Low Cost Auto Insurance Program starting at 16 years old. pic.twitter.com/ZLs1EIPwBi
— CA LowCost Auto (@CALowCostAuto) December 17, 2019
How much does insurance cost for a 17-year-old male?
The national average to insure a 17-year-old for car insurance is $8,844 a year, which is 237% more than what adults over 30 pay.
By comparison, the national average for adults is currently $1,758 a year. Specifically, that’s for teens between ages 16-19. (source)
The good news is that insurance costs do start going down at age 19 ($4,130/year) and then down again at age 21 ($2,217).
By the time your child turns 25, they’ll still be a lot higher than what it costs parents, but still gradually improving, coming in at 1,931.
I have daughters so the good news for me is that female teens generally see an average of 12% better rates than teen boys. AND when they turn 19, they will be saving about 45% over what parents with teen boys are paying.
The reason, of course, is that statistically speaking, girls are much safer drivers than boys.
The other potentially bad news is if you live in one of the following states, which rank as the most expensive states for teenage driving insurance costs:
- Texas (darn it, that’s where I live)
- New York (no surprise, but if we lived in NYC we wouldn’t drive)
- Deleware
- Louisana
- Michigan
Experts Tips on Arizona Auto Insurance for Teens https://t.co/22iGYaokOI pic.twitter.com/9aMYlUltQp
— CelluCar (@CelluCarBlog) May 28, 2016
Do I need insurance to drive my parent’s car?
Yes, once a teen gets a driver’s license (not a learner’s permit) they do need insurance even if driving their parent’s car. Teens don’t have to have their own policy, and it’s usually cheaper for a teenager to be added to their parent’s policy.
Ultimately insurance covers a driver, not a vehicle, and even if they have insurance on their cars, if you drive them without being added, you are driving without insurance.
Trust me, as someone who got a no-insurance ticket in my early 20’s, you DON’T want that.
You especially don’t want it as it’s probably a whole lot more expensive of a mistake now than it was then. At the time, I thought I couldn’t afford insurance while flipping burgers at Wendy’s for $3.25/hour (which was kind of true).
BUT, in reality, the ticket and then having to file an SR-22 each year for 5 years afterward was REALLY something I couldn’t afford.
So yes, new drivers should get their parents to add them to their insurance, or don’t drive. It’s as simple as that.
Tip for parents of teens: Auto insurance companies usually don’t require you to add your teenager to your auto insurance policy until he or she has a driver’s license. While they have their learner’s permit, you don’t need to add them. pic.twitter.com/fHVs2nRTSc
— Frye Ins. Associates (@Frye__Insurance) April 1, 2019
How much does insurance go up after adding a teenager?
For a 1-car family, expect your auto insurance to go up about 44% for adding a teen to your policy. With 2 cars you will see a 58% increase, and having 3 cars with a teen on the policy will see an increase of 62%.
Figures courtesy of Insurance.com.
All that being said, adding them to your policy is DEFINITELY what you want to do compared with getting them their own separate policy.
For the same coverage on the same car with their own individual policy, you or they will pay 365% MORE than if you just added them to your policy.
In short, no matter what you do, having teenage drivers is an expensive proposition, so just start budgeting now.
Can I stay on my parent’s car insurance if I move out?
Younger drivers can usually only stay on your parent’s auto insurance policy after moving out if you are still their dependent, driving a car they own, or if you are a full-time student. In most cases, insurance companies prefer the insured to live and park the car where the main policyholder lives.
What it comes down to is an insurance term called “separate residence” and the definition of that term varies from company to company.
Staying on their policy, which is definitely cheaper up through age 25, works best if you leave home to attend college, whether you stay in college housing or rent somewhere near the university. This is often true whether you are using an in-state school or are in a different state.
But do check with your parent’s insurance company as it may vary from company to company.
Unlike health insurance, there is not a dedicated cutoff age for children being on a parent’s insurance policy.
But in most cases, once a child is done with college, unless they are living with their parents, it’s unlikely the insurance company will continue to allow them to stay on their parent’s policy.
Final thoughts
In this post, we looked at the cheapest car to insure for a teenager. But we also explored safety concerns, looked at why the costs to insure a teen are so high, and explored some ways you can cut those costs.
When it’s time to get your teen their first car, get them involved. Ask their opinion on which car they like best.
Also, get them involved in the financial process.
Have them save up and then match however many dollars they can raise. That’s exactly what my dad did for my first car and it was a great financial lesson that has stuck with me. Or if you buy the car have them be responsible for insurance and maintenance.
We also know that car repairs can be expensive.
And what’s worse is that many people don’t have enough money to pay for it. So, how to pay for car repairs with no money? Well, the answer is simple: you need to get insurance coverage for your car or you can get a small loan. This will protect you in case of an accident or other mishap. It will also cover any damage done to the car by other drivers or objects, such as trees or rocks.
Buying your teen a car can be stressful, nerve-wracking, and expensive, but it doesn’t have to be that way.
The images used in this post were acquired from the web and are considered “fair use” under US Copyright law given this post is for the purposes of reviewing these products. That being said if the original photographer prefers us to not use their photo, we will happily swap them out upon being contacted.
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