Tips for Buying Car Insurance for the First Time

Last Updated on December 30, 2025

Buying car insurance for the first time can feel intimidating—especially if you’re not sure what coverage you need or what information insurers will ask for. The process is usually straightforward once you know what to gather and what decisions actually matter.

As a first-time customer, you may pay more at first because you haven’t built a long, verifiable insurance history yet. But you can still find a solid policy at a competitive price by comparing quotes, choosing the right coverages, and stacking the discounts you qualify for.

Below is a step-by-step guide to buying car insurance for the first time, what you’ll need to apply, how coverage works, and how to save.

Key Takeaways

• Buying car insurance for the first time is mostly about comparing quotes, choosing coverage, and starting the policy before you drive.
• First-time buyers often pay more initially because insurers have less insurance history to evaluate, even if your driving record is clean.
• Know the difference between required liability coverage and optional coverages like collision, comprehensive, UM/UIM, and rental reimbursement.
• You can often cut costs by shopping multiple insurers and stacking discounts like bundling, multi-vehicle, defensive driving, and safe-driving programs.

What “First-Time Car Insurance” Can Mean

You might be buying car insurance for the first time in a few different situations:

• You just got your driver’s license and need your first policy.
• You bought your first car and need coverage to drive it legally.
• You’ve been driving, but you’re moving off your parents’ auto insurance policy and need your own.
• You had a long lapse in coverage and are starting over with a new policy.

No matter which situation you’re in, the shopping process is similar: get quotes, choose coverages, apply, and set an effective start date.

How to Buy Car Insurance for the First Time

Buying car insurance for the first time usually comes down to three simple steps:

Step 1: Compare quotes. Rates vary by insurer—especially for first-time buyers. Use multiple quotes to see what car insurance rates can look like for new drivers and find the best value for your budget.

Step 2: Choose how you want to shop. You can buy directly from a company online, by phone, or you can work with a broker vs. an agent to compare options and place coverage.

Step 3: Start coverage on the right date. Make sure your policy begins before you drive the vehicle. If you’re in the buying process, you may be able to get car insurance before buying a car so you’re ready when you take delivery.

What You Need to Get a Quote and Apply

You can sometimes start a rough quote with just a ZIP code, but accurate quotes (and the final application) require details about you, your vehicle, and your household.

Before you apply, gather the items in this checklist of documents and information needed to insure your car. In general, insurers may ask for:

• Driver’s license number (for all drivers in the household)
• Date of birth and address
• Vehicle information (VIN, year/make/model, mileage, garaging address)
• Prior insurance information (if any), including coverage lapse details
• Lienholder/lease information (if the car is financed or leased)

Your car matters a lot, too. Insurers price policies differently depending on the type of vehicle you drive and how it affects your insurance rates.

Know Your State Minimum Requirements

Nearly every state requires at least a minimum amount of liability coverage to drive legally. New Hampshire is a well-known exception with unique financial responsibility rules, which we explain here: Is car insurance required in New Hampshire?

Minimum limits vary widely by state. You can look up your state’s rules here: state-by-state auto insurance requirements. Even if you buy only the minimum, consider whether it’s enough to protect your finances after a serious crash.

Understand Required vs. Optional Coverage

First-time buyers often overpay (or underinsure) because they’re unclear on what’s required and what’s optional. Here’s the simplest way to think about it:

Liability coverage (usually required): Most states require bodily injury liability coverage and property damage liability coverage. These cover other people’s injuries and property damage when you’re at fault.

Physical damage coverage (often required by lenders): If your car is financed or leased, your lender typically requires “full coverage,” meaning collision + comprehensive.

Optional coverages that can be worth it:

• Collision coverage helps repair/replace your car after an accident (including at-fault accidents, subject to your deductible).
• Comprehensive coverage helps protect your car from theft, vandalism, weather, and other non-collision losses.
• Personal injury protection (PIP) may help cover medical bills and related expenses after a crash (required in some states).
• Medical payments (MedPay) can help with medical costs in certain situations, depending on your state and policy.
• Uninsured/underinsured motorist (UM/UIM) coverage helps protect you if the other driver has no insurance or not enough insurance.
• Rental reimbursement coverage can help pay for a rental if your vehicle is in the shop after a covered claim.
• Many policies extend coverage to rentals in certain situations—see whether your auto insurance policy covers rental cars.

If you’re trying to maximize protection, start here: buying full coverage auto insurance. If you’re only trying to meet legal requirements, a minimum-liability policy is cheaper—but it offers far less protection for your own vehicle.

Why First-Time Buyers Often Pay More

Even if you’re a careful driver, insurers often charge more at first because they have less history to evaluate. They’ll typically review your motor vehicle record (MVR), which is why most insurers check your driving record during quoting or underwriting.

On top of that, many companies also price based on “insurance history” (like continuous coverage and claim patterns). If you’re brand new—or you’ve had a lapse—you may not qualify for certain tiered pricing and discounts yet.

What should you budget for? Costs vary massively by state and driver profile, but in recent years, national averages for full coverage have often been in the mid-$2,000s per year, with minimum coverage commonly under $1,000 per year. First-time buyers can pay significantly more than those averages until they build a clean, continuous history.

In many states, credit history can also affect pricing. If you’re curious how that works (and where it’s restricted), see whether credit score affects car insurance rates.

How to Save Money on First-Time Car Insurance

First-time buyers can still save—often a lot—by stacking discounts and making smart coverage choices. Start with these high-impact strategies:

• Shop multiple quotes: One company may treat you like a brand-new driver, while another prices you more favorably.
• Choose a vehicle that’s cheaper to insure: Safety ratings, repair costs, and theft rates all matter.
• Consider a higher deductible: This can lower premiums, but make sure the deductible is affordable in an emergency.
• Build a clean record quickly: Avoid tickets and claims when possible so you can earn pricing tiers and better discounts over time.

Also ask specifically about discounts that apply to your situation:

• Safe driving discounts (sometimes including telematics/usage-based programs)
• Bundling discounts (auto + renters/home)
• Multi-vehicle discounts if you insure more than one car
• Good student discounts (helpful if you’re a student of any age and your insurer offers it)
• Defensive driving course discounts in states/companies that offer them
• Homeowner-related discounts, if you own a home
• Claims-free discounts as your history develops

If you’re a younger first-time buyer, you may also want to compare providers that focus on affordability for young drivers.

Best Car Insurance Companies to Quote for First-Time Drivers

There’s no single “best” insurer for every first-time buyer. Pricing varies by state and by company appetite for newer customers. If you want a broader roundup, check out our list of top auto insurance companies for new drivers.

As a starting point, here are reputable insurers that are commonly worth quoting (availability varies by state):

• Progressive
• GEICO
• State Farm
• Allstate
• Travelers
• Liberty Mutual
• Nationwide
• Erie Insurance (available in select states)
• American Family Insurance (available in select states)
• USAA (if eligible)

USAA can be an excellent value for eligible drivers, but it’s only available to military members, veterans, and qualifying family members.

Common Mistakes First-Time Buyers Should Avoid

• Buying only the state minimum when you have a financed or leased car (lenders usually require collision and comprehensive).
• Choosing limits that are too low to protect your savings and income if you seriously injure someone in a crash.
• Not listing household drivers correctly, which can create claim headaches later.
• Letting coverage lapse, which can raise rates when you return to the market.
• Forgetting to set the effective date to match when you actually start driving the vehicle.

FAQs on Buying Car Insurance for the First Time

Final Word on Buying Car Insurance for the First Time

Buying car insurance for the first time doesn’t have to be complicated. Gather your info, compare quotes, choose the coverages that match your situation, and ask about every discount you might qualify for.

If your first quote feels expensive, don’t panic. First-time pricing often improves as you build a clean record and continuous coverage—especially if you re-shop your policy at renewal.