How To Buy Car Insurance For the First Time

Finding car insurance as a first-time buyer can be a daunting task. Because these drivers lack experience, insurers charge much higher rates to first-time drivers, regardless of age. In some cases, you can expect to pay $5,000 or more for your first year of car insurance.

When purchasing auto insurance for the first time, we created a guide to help you better understand the process and save money.

How to get car insurance for the first time

When purchasing car insurance for the first time, customers must:

• Collect your personal and vehicle information.
• Get a quote online or consult with an insurance agent.
• Get multiple insurance rates to compare quotes.

First-time drivers may be unaware of how much information is required to obtain auto insurance quotes, and the process can be difficult for new shoppers to understand the first time around. All of the items you'll need are listed below.

Once you've gathered your materials, you can get a quote directly from most insurers' websites or work with an insurance agent. To find the best rate, we usually recommend getting quotes from at least three different insurers.

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

When shopping for quotes, you'll need the following personal information for yourself and anyone else listed on the policy:

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

Some of this information, most notably driving history and location, will influence the cost of insurance for first-time drivers. You will also need vehicle information, such as the vehicle identification number (VIN), date of purchase, and person registered to the vehicle.

It's also a good idea to have the year, make, and model of your car ready, as this will help you get the best and most accurate policy for your new car insurance.

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

Location, demographic profile, driving history, and experience are all factors that influence car insurance costs. When it comes to determining car insurance rates, driving experience is the most important factor. Experienced drivers will pay far less than new drivers because insurance companies believe they are less likely to be involved in an accident or file a claim.

How much more new drivers will pay for car insurance

Insurance companies view first-time drivers as a higher risk and will charge them more for coverage. According to our sample data, first-time drivers pay approximately $4,529 per year for car insurance, whereas experienced drivers pay only $1,427 per year.

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

Insurance quotes for new drivers are significantly higher. The most expensive is Geico, which charges our sample driver with no experience $6,339 per year. A new driver will pay $5,101 more for insurance than a driver with 15 years of experience, according to Geico. In essence, regardless of age, inexperienced and first-time drivers will be charged more.

How first-time drivers can find cheap car insurance

Drivers can find low-cost auto insurance if they:

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

Shop around and compare insurance rates

To determine which company will provide you with the cheaper car insurance quotes for first-time drivers, you should obtain several quotes from various car insurance companies. It is simple to obtain quotes and compare insurance rates online. Speaking with an independent insurance agent, on the other hand, 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, comparing insurers can help you save money. When calculating your rates, different companies use different factors, 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 purchase more car insurance coverage than you require, you will be overpaying for coverage that you will never use. That means that one way to save money on car insurance is to only purchase what is required for your situation. Car insurance, on the other hand, has many different types of coverages; we've provided a brief cheat sheet below to guide you on how much of each type of insurance to purchase.

You want car insurance that protects your net worth as a first-time driver. You can certainly purchase more coverage for added security, but this will increase your insurance costs. To calculate your net worth, add all of your assets and subtract all of your debts. If your net worth is less than the state's minimum requirements and you want the cheapest policy possible, you should only consider purchasing the minimum liability coverage.

While new drivers compare auto insurance quotes, an insurer will usually recommend certain levels of coverage.

It is critical to understand the various types of coverage, requirements, and how much car insurance you actually require. Otherwise, you're paying for unnecessary expenses out of pocket.

Improve factors that affect insurance rates for first-time drivers

Many factors influence first-time driver car insurance rates. Some of them, such as age and location, are uncontrollable. However, there are some important factors, such as credit scores, that drivers can work on to improve in the long run and get lower insurance rates.

If you have a low credit score, insurers believe you are more likely to file large claims, and they will charge you higher premiums as a result. Gaining driving experience and being a safe driver will result in insurance companies charging you less in the long run.

Finally, when looking for cheap first-time car insurance, you should apply for every car insurance discount available within your demographic and location. These discounts are sometimes visible through a company's online quote tool, but you may be eligible for even more if you speak with an insurance agent before finalizing your quote.

Methodology

We looked at auto insurance quotes from Allstate, State Farm, Progressive, and Geico. Our sample driver is a 35-year-old single man who drives a 2015 Honda Civic EX. This driver had $15,000 in liability coverage per injured person and $30,000 in coverage for all injured people. In addition, this example driver has $5,000 in property damage liability coverage. The only variable that changed was the number of years of driving experience, which could be zero or fifteen.

The insurance rate data used in LowCostInsurance analysis came from Quadrant Information Services. These rates were obtained publicly from insurer filings and should only be used for comparison purposes — your own quotes may differ.