As a college student, having to pay high prices for car insurance on top of your already expensive education can feel like adding insult to injury, especially when you consider that younger drivers are slapped with higher premiums.
The good news is that it’s possible to find cheap car insurance for college students. Who offers the best prices? Is there a car insurance student discount you can take advantage of? Is it cheaper to go on your parents’ policy? Here are all the answers you’re looking for.
Why car insurance for students is expensive
Car insurance for college students isn’t known for being cheap. Drivers ages 16 to 25 typically pay more for car insurance than other age groups because they’re perceived to drive more carelessly, commit more traffic offenses, and file more claims.
Because they’re charged higher premiums, young drivers also tend to shop around more for car insurance quotes online and switch companies more frequently to save money. It costs insurance companies more money to set up new accounts as opposed to keeping existing customers, so they may pass on these extra expenses to young policyholders as well.
Even if you’re a safe driver and a loyal customer, you could still end up paying for other people’s bad habits on the road. Here’s a breakdown of the average cost of a six-month auto insurance policy by age for young drivers:
- Age 18: $3,590
- Age 19: $3,009
- Age 20: $2,667
- Age 21: $2,227
- Age 22: $2,064
- Age 23: $1,920
- Age 24: $1,799
- Age 25: $1,604
Is car insurance cheaper for college students vs. young people who are no longer in school? It can be, because many insurance companies offer student car insurance discounts. Insurance companies also consider drivers with more education to be more financially stable and less likely to drive recklessly, which can result in lower premiums.
Best companies that offer student car insurance discounts
According to the National Association of Insurance Commissioners, there are almost 6,000 insurance companies operating in the U.S. alone. With so many options, it can be hard to narrow down which insurers offer the best car insurance for students.
That’s why we’ve evaluated the top companies in the country to determine who provides the best cheap car insurance for students. Here are the results:
On top of offering low rates in general, GEICO also boasts an extensive number of student car insurance discounts. They include:
- Good student discount: This is available if you manage to maintain at least a “B” average.
- Good driver discount: You can qualify for this discount if you’ve stayed accident-free in the last five years.
- Discounts for fraternity, sorority, and honor-society membership: These discounts are offered to members of groups such as Alpha Epsilon Pi, Kappa Delta, Phi Kappa Sigma, the National Collegiate Honors Council, and the National Society of Collegiate Scholars.
- Discounts for alumni associations, college conferences, universities, and student organizations: These discounts are available to members of many prominent schools and groups, ranging from the Ivy League to the American Medical Student Association.
State Farm’s car insurance student discount offerings are generous. Consider the following reductions and incentives for college students:
- Good student discount: This discount enables you to save up to 25% just for getting good grades. The savings last until you turn 25 years old, even if you’ve graduated from college.
- Student away at school discount: If you’re a college student under the age of 25 who’s moved away to attend school and only uses a car while you’re home, this discount may be for you.
- Steer Clear safe driver discount: State Farm’s Steer Clear program encourages people under the age of 25 to improve their driving skills and earn a discount on their car insurance in the process. To get this discount, you must use the Steer Clear app to watch safe-driving videos, take quizzes, and record your trips; complete the program within six months; and have no at-fault accidents or moving violations on your record within the past three years.
Metromile is a unique kind of car insurance for college students in that it charges for car insurance based on how much you drive. If you sign up with them, you’ll pay a low monthly rate starting at just $29, plus a few cents for each mile you drive.
The Metromile app knows when you’re operating a vehicle based on the location and motion data from your smartphone. All miles over 250 (or 150 for New Jersey drivers) in one day are free.
If you’re looking for car insurance for college students and you don’t drive very often, you could save a lot of money with this company. But one downside with Metromile is that it only operates in eight states:
- New Jersey
Liberty Mutual is another prominent company that offers quality discounts for car insurance for college students under the age of 26. They include the following:
- Good student discount: If you have a GPA of “B” or better, you can get a car insurance student discount.
- Student away at school discount: If you move away from home to attend college and only occasionally drive a car, then you may benefit from this discount.
Farmers offers discounts similar to those of other major insurers, and it may be an especially good option for college students who achieve high grades. Their car insurance student discount offerings are as follows:
- Good student discount: You can qualify if you have at least a “B” average, if you make the dean’s list or honor roll, or if you rank in the top 20% of your class or on standardized testing.
- Distant student discount: If you attend college far from home and don’t have regular access to insured vehicles, you may qualify for this discount.
Ways to save money on student insurance
Most car insurance student discount offerings tend to have an age limit of 25, so graduate students may be out of luck. Additionally, there are residency requirements you may need to meet.
One way to save money on car insurance for college students is to stay on your parents’ insurance plan instead of getting your own. Many insurance companies will let you stay on your parents’ policy if you meet at least one of these conditions:
- The car you drive is titled in a parent’s name
- You live with your parents while attending college
- You live on campus, but your parents’ home is still considered your permanent address
If your name is on the car’s title, you’ll probably have to buy your own car insurance policy.
If you drive less while you’re away at college, you should ask if you qualify for a low-mileage discount. You’re usually considered to be a low-mileage driver if you drive fewer than than 7,500 miles a year.
As a low-mileage driver, you generally have two options to choose from: You can choose to get a discount on a standard auto policy, or you can go with a pay-per-mile policy that charges based on how much you drive in a specific time frame.
So, for example, let’s say you own a car and you plan to take it with you to college, but you’ll only use it two or three times a week to commute to a nearby part-time job. In this situation, you could generate significant savings with a low-mileage plan or discount.
If you want to save money on car insurance for college students, you should ask if you qualify for these common student car insurance discounts:
Student away at school discount: This is also known as a distant student discount or a resident student discount. If the car you usually drive is owned by a parent and you’ll be leaving it at home while you’re living on campus, then this discount may be perfect for you. To qualify, your college generally needs to be at least 100 miles from your home.
Multiple-policy discount: It’s common for insurance companies to offer discounts to people who have more than one policy with them. So, if you have your own car insurance policy and you also need a renters policy while you live in an apartment, you should consider bundling them with the same insurer.
Anti-theft device discount: If you’ll be taking your car with you to college, then you may want to install an anti-theft device. This will reduce your risk of having your car stolen and filing a claim, and your insurer may reward you with a discount.
Good grade discount: Insurance companies like to reward top students. Studies show that “A” and “B” students are more likely to be better drivers compared to “C” and “D” students. Most insurers require a minimum of a “B” average or a GPA of 3.0 to qualify for this discount.
Important factors that affect car insurance for students
The cost of car insurance for college students is determined by several factors. Three of the most important factors are:
Where will you be living?
It’s generally recommended that college students stay on their parents’ car insurance plan, but there is one exception to be aware of. If your college is in a small rural town, but your parents’ home is in a big city, then it may make more financial sense to get your own auto policy. This is because residents of small towns tend to get cheaper insurance than urban dwellers due to things like lower crime and accident rates.
Another consideration when it comes to location is whether you’ll be living at home or moving away for college. If you’ll be moving away, you may be able to stay on your parents’ car insurance policy as long as their home is still considered to be your permanent address.
Who owns the car?
If your car is titled in a parent’s name or if it’s jointly titled—meaning you and a parent are essentially co-owners—then you may be able to stay on your parents’ auto policy.
However, if you’re the sole owner of your car and your name is the only one on the title, then you’ll likely need to get your own car insurance policy.
How much will you drive?
Mileage is another big factor when it comes to car insurance for college students. If you’ll be moving away to attend college and only driving the family car on occasion when you return home, then you may qualify for a student away at school discount.
If you’ll be taking your car with you to college and logging less than 7,500 miles in a year, then you may qualify for a low-mileage plan or discount.
And if you’ll be commuting regularly in your car to get to class or a part-time job, you should consider getting collision coverage. This type of auto insurance can cover damages to your car after a collision with another vehicle or object. But it will raise the cost of your car insurance compared to having just the minimum required amount of liability car insurance.
Where to shop for student car insurance
There’s no secret to getting cheap car insurance for college students—you just need to shop around to gather the most affordable quotes. And the easiest way to do this is to shop online.
One option is to visit the website of several car insurance companies, fill out a bunch of long forms, compare the quoted rates and discounts, and then deal with the phone calls and paperwork to switch policies.
But there’s a better option out there—a free app that gathers the most affordable quotes for you in seconds and sets up your new insurance policy for you. Called Jerry.ai, it puts insurance shopping on autopilot.
It takes less than a minute to sign up for Jerry. And once you do, the app analyzes your coverage, compares prices from dozens of insurance companies, and does all the hard work to switch policies and save you money. It’s fast, it’s easy, and it could save you hundreds of dollars a year on your student car insurance!