What is a young driver fee, and how much do they cost?

Quick Insights:

• A young driver fee is an extra charge imposed by rental companies on drivers under the age of 25 to offset increased risk and higher insurance costs.
• These fees can vary widely, with some as low as $10 and others as high as $65 per day, influenced by factors such as rental company, location, vehicle type and duration.
• Memberships in certain organizations or using corporate accounts can often help waive or reduce young driver fees.

Whether you’re thinking about renting a car for business purposes, a sightseeing vacation or just getting to and from a special event, it’s important to understand all the costs and what’s laid out in fine print. When it comes to younger drivers looking to rent a car, many car rental companies make the service a little more costly to account for increased risk. In this article, we’ll discuss why this is the case, what young drivers should expect when renting a car and how to potentially waive young driver fees.

What is a young driver fee?

A “young driver fee” is an extra charge applied to a rental agreement for young drivers, typically referring to those between the ages of 18 and 25. In fact, most car rental companies will not even rent to drivers under the age of 18. It’s worth noting that this is not a “new driver” fee as the criteria for these fees are strictly age-based, applied regardless of when the driver got their license or the condition of their driving record. Even as a secondary driver (for example, when renting a car with a parent for a family trip), young drivers in this age range are still typically on the hook for an additional fee.

Why is there a young driver fee?

At a glance, it may seem unfair that younger drivers are expected to pay more simply because of their age. However, there are perfectly valid reasons why these fees have become standard practice for rental companies.

Increased risk factors for young drivers

The main reason for young driver fees is the increased potential for road accidents. Statistics collected by the National Highway Traffic Safety Association show that young drivers are over-represented when it comes to fatal car accidents. While this sad fact does not mean that all young drivers are reckless, it does explain why extra consideration is paid to these drivers when it comes to renting a car.

Added costs for rental companies

The increased risk of young drivers getting behind the wheel translates to higher costs for rental agencies and insurance companies alike. These types of businesses build their cost structures around statistics that estimate the potential for lawsuits, property damage and other resource-intensive liabilities. As a result, rental car young driver fees provide the business with added financial coverage for such outcomes.

Additionally, some rental companies will go as far as to limit young drivers to certain kinds of vehicles. When vehicle choices are limited in this way, it’s typically flashier or more expensive models that are off-limits to younger drivers. Instead of limiting choices, some companies will simply apply a higher fee.

How much are young driver fees?

Calculating the cost of your rental is an important aspect of budgeting for your trip, especially if you want to fit many activities into your time away. In general, young driver rental fees range from $10 to $65 per day, added to the regular daily cost. This wide range is due to the numerous factors that can influence your rental agreement, including rental company, location, type of rental and rental duration. The best way to narrow down how much your actual rental will cost is to visit the rental company’s website and call in to request a personalized quote.

How can you waive a young driver fee?

In some cases, it’s possible for a person under the age of 25 to avoid a young driver fee. Certain car rental companies may allow you to bypass young driver fees if you:

• Join a membership program. Memberships in certain organizations (for example, AAA and USAA) may offer benefits including waived young driver fees.
• Book through a corporate account. If you’re renting a car for work purposes, booking through a corporate account may negate age-based fees.
• Take advantage of a promotion. A quick web search or phone call to the rental company can help surface promotions aimed at students or young drivers.

Young renter fees vs. young driver fees

Depending on where you live, you may find that young driver fees are instead referred to as “young renter fees” or a “young driver surcharge.” Oftentimes, these terms are used interchangeably or regionally. To help ensure you’re booking the right kind of rental, take the time to read all terms and conditions before submitting your payment information.

Bottom line

If renting a car will factor heavily in your upcoming travel plans, gathering all the information ahead of time can help you navigate costs and make prudent financial decisions. Be sure to research your options and ask the rental company for clarification on any lingering questions before the critical moment arrives. Planning ahead can also help you identify ways to potentially waive young driver fees, such as by joining a relevant organization. Once your rental is squared away, all that’s left to do is drive safely and enjoy your trip!