Auto Insurance for Teen Drivers

Before Getting a Learner’s Permit, Make a Call to Your Insurance Professional

Your insurance agent can explain the costs of insuring a teenage driver. The good news is that insurance rates will drop as your teenager gets older—provided he or she has a good driving record. Therefore…

Involve Your Teen in the Car Insurance Discussion

From the outset, talking to your kid about the relationship between driving a car and the attendant responsibilities, including insurance costs, is essential. Explain and reinforce driving safety tips and the severe consequences of driving infractions or accidents, including increasing the cost of insurance.

Encourage Positive Behaviors

Auto insurers offer discounts or reduced premiums to:

• Students who maintain at least a “B” average in school
• Teens who take a recognized driver training course
• College students who attend school at least 100 miles away from home and don’t bring their car to campus

Choose the Right Auto Insurance Company

It’s generally less expensive for parents to add teenagers to their auto insurance policy than for teens to purchase one independently. By insuring your teenager’s car with your insurer, you may also qualify for a multi-vehicle discount. Insurance companies differ in pricing policies for young drivers, so research prices to find the best fit for you and your teen.

Assign Your Teen to the Right Car

Find out how your insurer assigns drivers to cars. Some insurers assign the driver who is the most expensive to insure (generally the teenager) to the most expensive car. If possible, assign your teen to the least valuable car.

Note that this arrangement has no exceptions; your teen must use only the car to which he or she is assigned, even in an emergency. If your teenager is involved in an accident with an unassigned car, penalties could be imposed, and your premiums might increase.

Increase Your Liability Insurance for More Protection

If your teen gets into an accident, state minimums for liability insurance will not fully protect you from lawsuits. Consider purchasing higher liability coverage. If your teenager is found negligent in an accident and the damages exceed your insurance limits, you will be held financially responsible. You could be sued in court for those amounts not covered by your insurance. Depending on the value of your financial assets, you may even want to have the extra protection that a personal umbrella liability policy provides.

Raise Your Deductible to Save on Your Premium

The higher your deductible, the more money you can save on your premium, so consider raising your deductible from the minimum amount required. You may want to use those savings to increase your liability insurance.

Source: Insurance Information Institute