Average Car Insurance Cost

Car insurance is likely to cost more than $5,500 annually for a new driver who is 17 years old to get a stand-alone policy. On the other hand, auto insurance will cost about $2,750 extra per year when adding a 17-year-old new driver to a parent's policy. But insurance costs for new drivers vary widely.

Age is a major factor in how much insurance costs for a new driver. Not everyone gets their first license at 16 or 17 years old. A new driver could be 25 or 40 or even 60 years old. Insurance companies set different prices for insuring a newly licensed teenager and someone getting their driver's license later in life. They also factor in gender, state of residence and coverage amounts. Insuring any new driver, however, is more expensive than covering an experienced driver with good driving and insurance records.

Statistics show that new drivers tend to be high-risk drivers who are more likely to get into accidents and file claims. That's why insurance companies charge more to insure them. You can't fight statistics, but sometimes, you can make them work for you in order to get the best possible price. A look at car insurance statistics yields the following findings.

• Adding a teen to a parent's policy is cheaper. If you are a teen driver living at home or in a dorm, ask your parents to add you to their policy. It will be about half as costly as having your own policy.

• Luxury cars are expensive to repair, and sports cars are likely to be driven too fast. Driving a cheaper, practical car with good safety and anti-theft features will lower your rates.

• Students with good grades are better drivers. Insurance companies give discounts to students with a B average or better.

• Driving courses improve drivers' skills. Many insurance companies offer discounts for attending driver's ed or online defensive driving schools.

• Teachers, physicians, police officers, and other well-educated professionals file fewer claims. Some insurance companies offer discounts based on occupation.

If you are a new driver of any age, it's worthwhile to comparison shop rates and discounts carefully. The cheapest way to do this is by getting free online quotes from multiple auto insurance companies.

Classic car insurance costs as much as 36% to 50% less than a standard car insurance policy, in most cases. Insuring a classic car generally is much cheaper than insuring a regular car because a classic spends less time on the road than a vehicle used for commuting or regular errands.

Like with any auto insurance policy, each driver's classic car insurance premium will vary based on individual risk factors such as location, driving history, the driver's age, and the vehicle's value. Classic car insurance usually applies to antique vehicles as well as to new, high-performance cars. Requirements and prices vary by company, though.

Classic Car Insurance Costs by Company

• Grundy: 50%+ less than standard car insurance
• Hagerty: up to 36% less than standard car insurance
• American Collectors: up to 40% less than standard car insurance
• Nationwide: up to 43% less than standard car insurance
• Heacock Classic: up to 40% less than standard car insurance

Why Classic Car Insurance Costs Less Than Normal Car Insurance

Almost every classic car insurance provider forbids regular use of the vehicle, which reduces the risk for the insurer and keeps costs low. Classic cars are generally limited to parades, car shows, and pleasure driving up to a mileage limit stated in the policy. As a result, you may need to provide proof that you own a regular car for daily use when purchasing classic car insurance.

Another key difference is that most classic car insurers pay the vehicle's “agreed value” if it is totaled. This amount is decided when the policy is purchased and reflects the fact that classic cars maintain their worth over time. On the other hand, standard car insurance policies usually pay a vehicle's actual cash value in the event of a total loss, accounting for depreciation.

How to Lower the Cost of Classic Car Insurance

You can lower the cost of a classic car insurance policy by comparison-shopping for quotes and taking advantage of discounts. Many discounts will be the same as those for regular car insurance, such as discounts for having an anti-theft device or taking a defensive driving course. Some companies also offer discounts for membership in certain car clubs or for switching from a different insurer.

Car insurance for a 16-year-old costs $3,343 per year, on average, or $278 per month. Sixteen-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim.

Because the cost of coverage for 16-year-olds is so high, it's important to shop around for multiple quotes before buying a policy. Some of the best car insurance companies for 16-year-old drivers are Travelers, USAA and Progressive.

Cost of Car Insurance for a 16-Year-Old by Company 

The exact cost of car insurance for a 16-year-old depends on a few factors, including their driving record, gender, and vehicle type. Additionally, whether a 16-year-old is buying their own policy or being added to their parents' policy makes a difference.

Adding a 16-year-old to an existing policy will raise the premium by an average of 140% to 160%. But even with the added cost, it's still a more cost-effective option than having the driver purchase their own policy.

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for a 21-year-old costs $1,250 per year, on average, or $104 per month. Twenty-one-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim 

Because the cost of coverage for 21-year-olds is so high, it's important to shop around for multiple quotes before buying a policy. Some of the best car insurance companies for 21-year-old drivers are USAA, Travelers and Geico.

Cost of Car Insurance for a 21-Year-Old by Company 

The exact cost of car insurance for a 21-year-old depends on a few factors, including their driving record, gender, and vehicle type. Additionally, whether a 21-year-old is buying their own policy or being added to their parents' policy makes a difference.

Adding a 21-year-old to an existing policy will raise the premium by an average of 140% to 160%. But even with the added cost, it's still a more cost-effective option than having the driver purchase their own policy.

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for an 18-year-old costs $2,415 per year, on average, or $201 per month. Eighteen-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim.

Because the cost of coverage for 18-year-olds is so high, it's important to shop around for multiple quotes before buying a policy. Some of the best car insurance companies for 18-year-old drivers are Travelers, USAA and Mercury.

Cost of Car Insurance for an 18-Year-Old by Company 

The exact cost of car insurance for an 18-year-old depends on a few factors, including their driving record, gender, and vehicle type. Additionally, whether an 18-year-old is buying their own policy or being added to their parents' policy makes a difference.

Adding an 18-year-old to an existing policy will raise the premium by an average of 140% to 160%. But even with the added cost, it's still a more cost-effective option than having the driver purchase their own policy.

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for a 17-year-old costs $2,752 per year, on average, or $229 per month. Seventeen-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim.

Because the cost of coverage for 17-year-olds is so high, it's important to shop around for multiple quotes before buying a policy. Some of the best car insurance companies for 17-year-old drivers are Travelers, USAA and Mercury.

Cost of Car Insurance for a 17-Year-Old by Company 

The exact cost of car insurance for a 17-year-old depends on a few factors, including their driving record, gender, and vehicle type. Additionally, whether a 17-year-old is buying their own policy or being added to their parents' policy makes a difference.

Adding a 17-year-old to an existing policy will raise the premium by an average of 140% to 160%. But even with the added cost, it's still a more cost-effective option than having the driver purchase their own policy.

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for a 20-year-old costs $1,618 per year, on average, or $134 per month. Twenty-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim. 

Because the cost of coverage for 20-year-olds is so high, it's important to shop around for multiple quotes before buying a policy. Some of the best car insurance companies for 20-year-old drivers are Travelers, USAA and Mercury.

Cost of Car Insurance for a 20-Year-Old by Company 

The exact cost of car insurance for a 20-year-old depends on a few factors, including their driving record, gender, and vehicle type. Additionally, whether a 20-year-old is buying their own policy or being added to their parents' policy makes a difference.

Adding a 20-year-old to an existing policy will raise the premium by an average of 140% to 160%. But even with the added cost, it's still a more cost-effective option than having the driver purchase their own policy.

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for a 25-year-old costs $862 per year, on average, or $72 per month. USAA, Geico and Progressive drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim.

The exact cost of car insurance for a 25-year-old depends on a few factors, including their driving record, gender, location, vehicle, and car insurance company. Some of the best insurance companies for 25-year-old drivers are USAA, Geico and Progressive.

Cost of Car Insurance for a 25-Year-Old by Company 

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance for a 23-year-old costs $1,053 per year, on average, or $88 per month. Twenty-three-year-old drivers pay more for car insurance than older, more experienced drivers because insurers consider them to be high-risk, meaning they're more likely to file a claim.

The exact cost of car insurance for a 23-year-old depends on a few factors, including their driving record, gender, location, vehicle, and car insurance company. Some of the best insurance companies for 23-year-old drivers are USAA, Travelers and Progressive.

Cost of Car Insurance for a 23-Year-Old by Company 

To learn more, check out WalletHub's guide to the best car insurance for teens and young drivers.

Car insurance in South Dakota costs roughly $80 per month, or $955 per year, on average. That is less than drivers in other states typically pay for car insurance.

How Much Insurance Costs in South Dakota for:

• Good drivers: $681
• New student drivers: $4,320
• High-risk drivers: $1,334

Where South Dakota Insurance Rates Rank Nationally

South Dakota ranks 12 out of 50 for the most affordable car insurance rates in the U.S. For context, Michigan has the most expensive insurance in the country, with drivers paying an average of $2,693 per year. And on the other end of the spectrum, Maine has the lowest average car insurance rate, at $896 per year.

Below, you can see how car insurance costs in South Dakota compare to rates in other states.

Why Is South Dakota Car Insurance So Cheap?

Low Crime Rate:

South Dakota has a high crime rate compared to other parts of the country. However, South Dakota is mostly a rural state with small cities and towns. This means cars aren't parked in busy downtown areas or getting into crashes on crowded highways, so insurance costs stay lower.

Lower Insurance Requirements:

State laws affect insurance costs, too. South Dakota has lower insurance requirements than many other states, which means insurance is slightly cheaper.

State fault laws: Since South Dakota's insurance is at-fault, car insurance costs are a bit cheaper. No-fault insurance states tend to see a lot of fraud, which raises costs.

In addition to these statewide factors influencing car insurance costs, your personal information also affects the price you pay for insurance. Some of the most impactful data points are high-risk violations on your record (e.g. DUI), your age, and your car's make and model. In South Dakota, a driver's credit score affects their insurance costs, too - a driver with no credit pays an average of 67% more than a driver with good credit.

Whether you are considered a responsible or high-risk driver, it is always worthwhile to compare costs between several insurance companies. In other words, make sure to shop around to find a good deal for your demographic.