Best cheap car insurance for students
If you're a student, your dollars won't go far. After paying the tuition, rent, books and expenses, you're lucky if you have a few dollars left over for a weekend break in the city. The last thing you want to do is overpay for your student's car insurance.
Luckily for you, there are a few companies that offer special discounts on student car insurance. Car insurance is expensive, especially for younger drivers, but there are options for you that can save you some money.
Don't assume that the cheapest coverage (i.e. the least coverage) is your best option. Most states require drivers to carry at least minimum liability insurance. If you hit someone, your liability insurance will cover their repairs. And if someone hits you, their liability insurance will cover your repairs.
However, if you have an accident in which no other car is involved that is your fault, then you are unlucky. You will have to pay for the repairs yourself, unless you have collision insurance. All in all, it can save you money in the long run to add optional coverage - such as collision insurance - to your student car.
Before shopping for car insurance, it is important to know what kind of coverage you need.
Minimum requirements: Most states require that you carry at least minimum insurance for personal injury and property damage. In the event of an accident, your liability insurance will cover repairs and medical expenses for the other driver. And if someone hits your vehicle, their liability insurance will cover your medical bills and repairs.
Personal injury protection: Some states also require car owners to carry personal injury protection (PIP) insurance. PIP insurance covers the cost of injuries to you and your passengers in the event of an accident, no matter who is at fault. Some PIP policies also cover funeral expenses.
Uninsured and under-insured coverage: In some states, drivers are required to take out uninsured and under-insured automobile insurance, which helps to cover your costs when an uninsured or under-insured driver defaults in an accident in which your vehicle is involved. This broad coverage can help pay for all types of expenses, including car repairs, medical expenses and lost wages.
Collision and extended coverage: If you are still making payments to your car, your lender is likely to ask you to take out collision and extended insurance. Collision insurance will help you pay for repairs to your car if you cause an accident. Comprehensive coverage pays to repair or replace your car after a non collision. For example, if someone steals your SUV or if it is damaged in a storm, your extended coverage covers repairs or helps you purchase new wheels.
Best student car insurance companies
- Allstate - Best rewards programs
- Geico - Best mobile app
- Progressive - Best rates
- State farm - Best discounts
|...||SimpleScore||J.D. Power Rating||AM Best Rating||BBB Rating||S&P Rating|
Best Rewards Programs - Allstate
Nowadays, it seems like everyone is advertising rewards programs, including insurance companies. As reward programs go, Allstate's shines brightly.
With Allstate's Drivewise® program you earn points for safe driving. Drivewise is part of the Allstate app and uses the functionality of your smartphone's location services. The program can measure your speed, indicate when you are on the phone or texting while driving and when you are stopping fast.
For every 10 trips you make without braking or speeding, you earn 200 reward points. Drive three consecutive days without hard braking to earn 200 extra points, plus 200 extra points for driving three consecutive days without speeding. Redeem your points for all types of goodies, including gift vouchers, magazine subscriptions, merchandise and travel expenses such as car rentals and hotel rooms.
Allstate's new Milewise pay-as-you-go program rewards irregular drivers with lower rates. Milewise policyholders pay a daily rate, plus a per-mile rate, which only applies on the days they drive. For example, if you pay a $1.50 daily rate and a $0.06 per-mile rate, you pay $2.70 on the day you travel 20 miles. After enrolling in Milewise, you must have a small device in your car on board the diagnostic port, often called an OBD-II port, located below the dashboard. When you get behind the wheel, the device tracks your mileage and deducts your insurance costs from a prepaid balance.
Currently, Milewise is only available in a few states, but it is the perfect reward program for university students who live on campus and only drive on weekends and holidays.
The BBB rates Allstate A+ and AM Best give the carrier an A+ (Superior) rating.
Best mobile app - GEICO
Geico's mobile app, available for Android and Apple devices, is packed with features.
It stores a digital copy of your insurance card and includes a breakdown page so you can request a towing service without having to make a phone call. Kate, Geico's personal assistant, can answer questions about your policy or bill and the app's augmented reality feature can help you find gas stations, parks and restaurants from the convenience of your smartphone or tablet.
With the Geico app you can pay your bill with just a few taps and make and track a claim after an accident. Do you always forget to change your oil? Then you don't have to worry, because with the Geico app you can get an alert when it's time to service your car.
Headquartered in Washington, D.C., Geico is a subsidiary of Berkshire Hathaway and has an A+ BBB rating. AM Best gives Geico an A++ (Superior) financial rating.
Best rates - Progressive
Progressive offers great car insurance rates for students, averaging around $1,700 a year.
Progressive's online Name Your Price tool offers a unique way to get the lowest rate. Enter the amount you want to pay for the car insurance and the algorithm provides the best coverage for your price range.
Progressive also offers numerous discount programs for purchasing multiple policies and longevity discounts for people who switch to Progressive after maintaining continuous coverage with another insurance company. Progressive's good student discount extends a price reduction to students aged 22 and under who maintain a B average.
Progressive has been in the insurance business since 1937 and has earned AM Best's A+ (Superior) rating. The BBB gives Progressive an A+ rating.
Best discounts - State Farm
Among our picks for the best cheap car insurance for university students, State Farm has the highest rates.
But State Farm offers the best discounts. Earn good grades and you can qualify for 25% discount. Best of all, you can keep the discount until your twenty-fifth birthday. Take a driver education before you turn 21 for even greater savings and maintain a good, accident-free driving record to earn more discount.
Parents who have students on their State Farm car policies can take advantage of the student discount at school. To be eligible, students must leave the car behind when they go to college and only drive when they return for vacations and vacations.
Insuring multiple vehicles with State Farm may entitle you to a 20% discount. Buy an apartment, house, life or tenant insurance, and you may be eligible for savings of up to 17%. State Farm offers discounts for cars equipped with airbags and anti-theft equipment. And, you can be eligible for up to 40% discount on State Farm's medical coverage if you own a late model car equipped with security devices.
Discounts vary by state, but with so many discount programs to choose from, you may be eligible for significant savings with State Farm.
AM Best gives State Farm an A++ (Superior) financial rating, and the Better Business Bureau rates State Farm A+.
Average rates for college students
Car insurance discounts for students
In addition to the standard factors that are included in the rates of car insurance for young drivers, such as the location, driving behavior and make and model of your car, other factors can also influence the rates of your car insurance.
Figures: If you no longer work at school, the insurance company will not increase your rates for making bad grades. However, most insurance companies do offer discounts for students who get good grades.
Infrequent driver discounts: If you leave your car at home when you go to college, you may be eligible for a large discount on your insurance. Many "student away from home" discounts still allow you to use the car when you come home for weekends or vacations.
Standalone vs. the parents' car policy: Often you can get a better insurance rate if your parents add you to their existing car policy. The terms and conditions of the policy vary from company to company. In some cases you may get better rates if you stay on your parents' policy for the first few years, but after your 19th or 20th year you may get a cheaper rate on a standalone policy.
Discount on safe driving: Most insurance companies offer discounts for policyholders who consistently avoid accidents, speeding and claims. Programs such as Progressive's Snapshot also monitor your driving behavior and offer rate reductions when you consistently drive safely.
Discount on driver training: Many insurance companies offer discounts to young drivers when attending driver training. Some school districts offer driver training for high school students. Before taking any driver training, make sure that it has been approved by your insurance company's discount program.
Some insurance companies have better discounts for high school students than others. The discounts may also vary by location, as the laws of state insurance differ. To get the cheapest insurance rate, you can get quotes from different insurance companies, comparing premiums, coverage and discounts.
College students during the COVID-19 pandemic
Good news: there are still good student discounts available, even if you take classes remotely. But maybe you should adjust your other discounts. If you depend on a "student away from school" discount, but you do school from where you live, for example, don't expect that discount to apply.
Eventually, when you're at home, you'll probably still want your car. That means you will have to maintain your car insurance. Know that you can still get a discount. Talk to your insurance company to find out what discounts you can apply based on your current living situation to get the best cheap insurance for college students.
Do students have to stay on their parents' insurance?
In general, it is cheaper for young drivers to take out insurance through their parents than on their own. The details vary from insurer to insurer, but it may pay to compare the rate you would get with a few other insurers if you get a stand-alone policy against the extra your parents would pay by adding you.
Really, the thing to know is that insurers consider young drivers to be risky. If you're 16, 17, and 18 years old, chances are you'll get cheaper insurance by staying on your parents' policy. But even turning 19 or 20 could be enough to allay the fears of insurers, so check your options annually. Collecting a few quotes a year and comparing them to the amount you pay on your parents' coverage can help you find the most affordable insurance for student cars.
Is car insurance cheaper if you're a student?
That depends. Some students may be eligible for good students and students who don't live at home, while non-students may not. However, since most students are young drivers, they still have higher insurance rates than more experienced drivers who have a comprehensive, clean driving style.
How much is the discount for good student insurance?
Student discounts can range from about 5% to 25% and vary from company to company. To get the best rate, look around and pay close attention to the discounts for students and young drivers.
Is car insurance cheaper for graduate students?
Usually, yes. This goes back to the fact that insurance companies see inexperience behind the wheel as an important risk factor. If you're in high school, chances are you have at least a handful of years of driving experience. This helps insurers see you as a lower risk, which helps you score a more affordable insurance policy.
In some cases, you may be able to get a good student discount while in grad school. Some insurers offer these discounts until you're 25 years old. Couple that with the reduced rate savings you get for more driving experience and you can be quite happy with the cost of your coverage.
Do I even have to have a car in college?
As an apprentice driver you probably pay a nice penny for your car insurance. But you don't have to worry about that cost if you don't have a car.
The best way to determine if a car is the right choice is to do a cost-benefit analysis. First, look at every transportation your college offers. For example, some schools offer a shuttle service or help cover the cost of the bus or train fare. If there is a free option that you can use, you might be much better off going to a car-free school.
Even if there isn't a solid transportation option through your school, take a look at how you could get around. Do you have to go all the way to the other side of town? Or just go to the grocery store at the end of the street? If you see yourself taking a short ride once or twice a week, run the numbers. Chances are that the cost is still far below the cost of car insurance, registration, gas and all other costs associated with car ownership.
If you know you have to travel long distances to get to work or an internship, it may make more financial sense to bring a car to campus. Run the numbers to find out if a car will help or hurt your wallet.