10 TIPS TO PAY LESS ON INSURANCE WITH TEEN DRIVERS
by: Remie Longbrake | published: October 23, 2022
Having teen drivers in the house can be anxiety-inducing in more ways than one. Putting a teenager behind the wheel can stress your patience and auto insurance rates.
Car insurance rates rise dramatically for drivers under 25, influenced by factors that increase the risk of an at-fault accident, such as age, driving habits and even gender.
Unfortunately, you can’t escape all of the financial fallout of adding a teen driver to your car insurance policy. But there are ways to get teen driver discounts and minimize the impact on your premiums with these tips outlined below.
1. Pick the right car
Many people buy a car, then find out how much they’ll pay to insure it, but your insurance agent can run those numbers before you ever buy.
If you’re buying a car for your teen, narrow down the options and use a quote calculator or talk with your agent to see what you’ll pay to insure each one. There might be a clear winner. Generally older models will overall cost less to insure, therefore look to buy a used vehicle, perhaps a few years older with safety features built-in such as collision avoidance, anti-lock brakes and dual airbags.
2. Take a defense driving course
Many auto insurance carriers provide discounts for drivers of any age who complete safe or defensive driving courses from certified instructors. So while there might be some expense for these courses upfront, safe driving certifications pay off later with a driver training discount that may last for years.
3. Shop around for lower insurance rates
Experts recommend shopping around for at least three quotes before adding a teen driver to your car insurance policy. If your current car insurance company isn’t the best deal, ask your insurance agent about rate matching or any discounts before switching.
4. Choose lower limits
Using the minimum coverage your state requires can lower auto insurance rates but cost you more in the long run if there’s a car crash. It’s advisable to have an emergency fund before adjusting liability limits with a young driver. You can however consider removing collision and or comprehensive coverages. Just keep in mind if get in an accident that means more out of your own pocket.
5. Raise the deductible
Raising your deductible — or the amount you pay out of pocket for an accident before insurance kicks in will lower your car insurance. However, think carefully about whether you have the savings to cover a minor accident upfront.
6. Apply for low mileage discount
Your student is probably eligible for a low mileage discount if their daily commute consists of zipping a few miles to school and back. Distant student rates are also a great deal for college students who live on campus but keep their car at home.
7. Apply for good student discount
If your teen makes the grade, there could be savings behind those stellar report cards. Several auto insurance companies, like State Farm and Allstate, provide discounts up to 25% for teen drivers who bring home grade-point averages that land them on the honor roll.
Keep in mind that a good student discount usually applies to college students, too, and might even last for a while after graduation.
8. Let the insurance company track you
Insurance companies will offer deeper premium discounts if you’re willing to let technology keep an eye on inexperienced drivers. It’s called telematics, and it involves installing an app or a device from your car insurance company that monitors driving history. Parents should be aware this type of tracking data can be used by major insurance companies to determine liability in the event of a crash, Brown cautions. So if you opt into auto insurance telematics, you may want to adjust the liability limits on the policy’s comprehensive and collision coverage.
9. Apply for group rate discounts
Some companies offer discounts to drivers who are members of AAA, the military, first-responder or other groups and clubs. It doesn’t hurt to ask!
10. Bundle and save
You might be surprised how much you could save by insuring your car with the same insurance company who also insures your home. Sometimes the savings could be as much as 40%. Certainly, worthwhile to quote if not already bundled. Ask your agent or broker to quote you so you can start saving today!
It is our recommendation to always consult with a licensed and reputable financial expert. This educational article is not specific advice. We strive to present quality, effective content. For specific references to our content please use our contact page.