5 Ways to Reduce Car Insurance Premium for Teenage Drivers
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So, it’s little wonder that car insurance premiums for teenagers range from 20% up to 40% or more compared to those who have passed the age of 26.
Most teenagers will not be able to take advantage of good credit or bundling simply because they have yet to purchase a home or build up an excellent credit rating.
The good news is that there are five good ways that teenage drivers can reduce the amount they spend on car insurance. This assumes that you cannot stay on your parents’ policy which is arguably the best way to pay less.
Find the Lowest Rate
Do not purchase from the first insurance company that you come across. Instead, shop around for the best rate. You may be surprised at how much you can save by taking the time to see what is available and looking for rates that may be 5% to 10% lower all because you shopped around.
Raise the Deductible
The easiest way to lower the premiums that teenagers pay for their car insurance is to increase their deductibles. To go from $300 to $500, for example, may save you a considerable amount of your premiums.
Find out what the maximum deductible is so that you can save even more money. Keep in mind that you will need to put back that amount in case you need to pay for out-of-pocket expenses associated with your insurance.
State Minimum Insurance
If you own the vehicle outright, you can get the state minimum requirement which usually consists of liability, uninsured or underinsured driver.
A vehicle that has a lien which means you used a loan to make the purchase requires comprehensive insurance which is far more expensive. So, if you own the vehicle and especially if it is an older model, you may want to consider the state minimum levels of insurance.
Take a Driver’s Safety Course
One way you can save from 5% to 10% is to take a recognized driver’s safety course. This provides some of the experience needed to know what to do behind the wheel which promotes safe driving behavior and helps avoid accidents from occurring.
Be sure the course you take is recognized by the insurance company so you can get the benefit.
Purchase a Safe Vehicle
The type of vehicle you drive helps determine the insurance rates that you pay. So, start off with an older, more reliable car to get the lowest prices possible.
This means staying away from high-performances vehicles and sports cars and focusing more on larger vehicles with proven safety records.
You may not look very cool driving one, but you may be saving 15% or more by choosing a safer car to drive.
A little research can go a long way for teenagers trying to save money on their auto insurance premiums, so take the time to look before you make the purchase.