There are many factors to consider when choosing car insurance, and, with young and first-time drivers, plans can look pricey at first. However, there are many resources online to help you compare the various plans available and choose which one is the best for you and your family.
If you’re looking for the right insurance plan for your teen driver, look at these tips to see how you can save money.
Weigh the Cost of Adding Your Teen to Your Insurance vs. Getting Their Own
Rates for teenage auto insurance will always be more than those for experienced, older drivers. Teenagers and young drivers are statistically more likely to get into accidents than older people. The crash rate for teen drivers is almost nine times as high as for middle-aged drivers.
For this reason, it is often much cheaper for parents to add teen drivers to their existing insurance policies instead of buying independent coverage. However, if you purchase the teen their own vehicle, you may have no choice but to buy them their own full coverage.
However, you can still take advantage of discounted rates by buying their policy from the same provider you use for your auto, home, or life insurance. Doing this can help your whole family benefit from multi-policy discounts, making your teen less expensive to insure.
Look for Teen Driver Discounts
When looking at different plans, search for insurance premiums specifically targeting teen drivers. Insurance companies offer discounts to reduce the cost of insuring young people.
Good Student Discount
Many insurance companies offer a Good Student discount for students with good grades. If you’re a teenage driver with a high GPA, you can qualify for anywhere from 10-25% off your insurance coverage. Every car insurance company is different, but for most, you will need a GPA of 3.0 to qualify.
Low Mileage Discount
If you’re a teen who is only using the car to get around town, to work, or to school, you may be able to get a low mileage discount. As long as you’re not planning any long road trips across state lines, you can save money by talking to your car insurance company about where you’re planning to drive and how far.
Defensive Driver Courses
Some teen drivers may be interested in taking a defensive driver education course. These courses prepare young drivers to deal with unexpected road hazards, reducing their chance of getting into an accident. Many of these courses are now online and are accessible 24/7, so you or your teen can complete them on your schedule.
Completing a defensive driving course can reduce your insurance costs by 5-20%. This discount is worth considering for teen and adult drivers looking to save money or raise their deductible.
Distant Driver
For older teen drivers who are leaving the nest to head to colleges farther away or out of state, it is a good idea to look for Distant Driver discounts. These can apply to teens who won’t be using the family vehicle during college semesters but might need to get around town during the holidays. Your teen might qualify for this discount if their educational institution is at least 100 miles from your residence and they’re 22 or younger.
Enroll Your Teen in Driver’s Ed
Enroll your teen in a driver’s ed program as soon as they are eligible. When they pass the program, they receive a certificate to provide to your insurance company to receive a driver’s ed discount. This is an excellent option for reducing insurance costs, especially if you’re adding your teen driver to your own insurance policy.
Teach Your Teen About Safety and Good Driving Habits
Along with research, if you are looking into auto insurance for your teen, it is important to educate them about auto insurance and the costs. If an accident occurs, teen drivers need to know that their insurance premiums can increase for many years if they are at fault. Safe driving and good grades are essential to keeping car insurance costs down through high school, college, and beyond.
Make Use of Online Resources and Cost Comparisons
Most car insurance rates will stay the same until the driver is 25 years old, at which time they will lower if the driver has a clean driving record. Road safety is paramount, especially in the early years of driving when teens are more likely to get into car crashes or accidents. Education and research are critical for both your wallet and your peace of mind when choosing the right insurance premium for you or your teen.
Finance is us offers free online resources to help you make informed decisions about the insurance coverage your family needs.
Disclaimer: All content on this site is information of a general nature and does not address the circumstances of any particular entity or individual, nor is the information a substitute for professional financial advice and services.
