How to Buy Car Insurance for the First Time

How to Buy Car Insurance for the First Time

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First-time drivers tend to pay higher car insurance rates, regardless of age, because insurance companies factor driving experience into your quote. In some cases, you can expect to pay $5,000 or more for car insurance in your first year of driving.

You can save on first-time car insurance by shopping for quotes, choosing the right amount of coverage and hunting for discounts.

Why first-time drivers pay more for car insurance than experienced drivers

Many factors affect car insurance costs, including location, demographic profile, driving history and experience. Driving experience is the most important factor when it comes to setting car insurance rates. Experienced drivers will pay far less than new drivers because insurance companies consider them lower risks for getting into an accident or filing a claim.

How much more new drivers will pay for car insurance

On average, first-time drivers pay about $4,529 per year for car insurance, whereas experienced drivers are only paying $1,427 per year. That's 217% more expensive.

Cost difference of a driver with no experience versus 15 years' experience

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These car insurance rates are for a 35-year-old California resident and show the difference in cost between a new driver and an experienced driver.

The insurance quotes for new drivers are considerably higher. Geico is the most expensive, charging our sample driver with no experience $6,339 per year. Geico will charge a new driver $5,101 more for insurance than the same driver with 15 years' experience. Essentially, inexperienced and first-time drivers will be charged more, regardless of age.

How to get car insurance for the first time

When buying car insurance for the first time, you will need to:

  • Gather personal and vehicle information.
  • Decide how much coverage you need.
  • Get online quotes or work with an insurance agent.
  • Compare quotes to make sure you're getting the best deal.

Once you've narrowed down your best rate, you can buy auto insurance online from most insurers or work with an insurance agent. We recommend getting free car insurance quotes from multiple companies to find your best rate.

You can also use our car insurance calculator to get an estimate of your insurance cost.

What info you'll need when you get car insurance for the first time

When you're shopping for quotes, you will need some personal info for you and anyone else listed on the policy:

  • Driver's license
  • Date of birth
  • Address
  • Occupation
  • Marital status
  • Education level
  • Driving history
  • Insurance history

Some of this information — like driving history and location — will affect the cost of insurance for first-time drivers. You will also need details about your vehicle, including the vehicle identification number (VIN), date of purchase and person who registered the vehicle.

Having the year, make and model of your car ready is also important, as it will help you get the best and most accurate policy for your new car insurance.

How first-time drivers can find cheap car insurance

Drivers can find cheap car insurance if they:

  • Shop around and compare insurance rates.
  • Get the right amount of coverage.
  • Improve factors that may affect insurance rates, such as credit scores.

Shop around and compare insurance rates

You should get several quotes from multiple car insurance companies to determine which company will offer you the cheapest insurance quotes for first-time drivers. It's easy to compare free insurance quotes online. However, speaking to an independent insurance agent may provide you with multiple quotes to find the cheapest insurance for first-time car buyers.

While first-time drivers may have higher car insurance quotes than more experienced drivers, you may still save by comparing insurers. Different companies use different factors when calculating your rates, and some of the more well-known insurance companies may not necessarily offer the lowest possible rate.

Get the right amount of coverage

If you buy more car insurance coverage than you need, you'll be paying extra for protection you'll never use. That means one way to save money on car insurance is to only buy as much as is necessary for your situation. However, car insurance has many different types of coverage; below, we've provided a brief cheat sheet to guide you on how much of each type of insurance to buy.

Type of coverage
Is it required?
Do I need this coverage?
Bodily injury liabilityYes, except in FloridaAccident limits based on net worth
Property damage liabilityYes, in every stateAccident limits based on net worth
Collision and comprehensiveNo, unless you lease or finance a vehicleNeeded if your car is worth more than $2,000
Uninsured and underinsured motoristYes, but only in 22 statesAccident limits based on net worth if you don't have personal injury protection or collision insurance
Personal injury protection (PIP)Yes, but only in 14 statesNot needed unless your health coverage does not include auto-related injuries
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As a first-time driver, you want to get car insurance that protects your net worth. You can certainly get more coverage for extra protection, but this will raise your insurance costs. To determine your net worth, add up your assets and subtract your debts. If your net worth is less than the minimum requirements for your particular state, and you're looking for the cheapest policy possible, you should consider purchasing minimum liability coverage.

While new drivers can compare car insurance online, an insurer will typically suggest certain levels of coverage.

It's important to understand the different types of coverage, requirements and how much car insurance you really need. Otherwise, you're paying out of pocket for unnecessary expenses.

Improve factors that affect insurance rates for first-time drivers

Many factors affect car insurance rates for first-time drivers. Some of them can't be controlled, such as age and location. But there are important factors, such as credit scores, that drivers can take steps to improve over the long term and get lower insurance rates.

If you have a low credit score, insurers think you are more likely to file higher claims, and insurers will thus charge you higher premiums. In the long run, gaining driving experience and being a safe driver will result in insurance companies charging you less.

Finally, you should apply for every car insurance discount available within your demographic and location when looking for cheap first-time car insurance. Sometimes you can see these discounts through a company's online quote tool, but you may be eligible for even more discounts if you talk to an insurance agent before finalizing your quote.

Methodology

We analyzed car insurance quotes from Allstate, State Farm, Progressive and Geico. Our sample driver was a single 35-year-old male who drives a 2015 Honda Civic EX. This driver had $15,000 of liability coverage per person injured and $30,000 of coverage for all injured persons. This sample driver also had $5,000 in property damage liability coverage. The only parameter that changed was years of driving experience, which was either zero or 15 years' experience driving.

ValuePenguin's analysis used insurance rate data from Quadrant Information Services. These rates were publicly sourced from insurer filings and should be used for comparative purposes only — your own quotes may be different.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.