What You Should Know Before Adding Teens (& minor) To Your Auto Insurance Policy?
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Learning how to drive in today’s world is vastly different than it was in the past. There are more distractions and more traffic and teenagers often think that they can handle anything. This can lead to some very dangerous conditions for driving.
Talk to your teens about these distractions and help them to understand that that text message or phone call can wait. It’s better to pull over and answer the phone than to answer it while driving. Let it go to voicemail and they can return the call later. This is by and far the largest distraction to teenage drivers today.
Before you ever add your minor to your auto insurance policy, there are some important factors to consider. Let’s examine these factors in more depth and see how we can safely add teens to the family insurance policy.
Do I Have To Add My Teen Driver To My Insurance Policy?
Typically, you’re not required to add a teen to your auto insurance policy until they have their formal drivers license. This means that while they are using their learners permit, you don’t have to add them to the policy.
However, you will need to let the auto insurance company know that they do have their learners permit. Each company will have slightly different rules in place and you’ll want to understand what the rules are for your particular insurance provider before you allow youngster behind the wheel of your car.
Is it mandatory? How can I still save money, is there an age restriction?
Auto insurance is mandatory in all states except these three. Your teen will have to have some form of car insurance before he or she can drive. A few states will allow students to have their own policy.
You can check with your specific state and find out if your state is one of the few that allow students to have their own insurance policy.
How Much Is It Going To Cost To Add A Teen To My Car Insurance?
Young drivers are going to pay more for auto insurance than adult drivers. According to the insurance industry, the pricing is built around risk and statistics.
Statistically speaking younger teen drivers tend to get into more accidents than older, more experienced drivers. Teens aged 16 to 19 years old are up to three times as likely to get into some form of a car crash than drivers who are over the age of 20 years old.
By the age of 25, these rates tend to level out and become more even across the board. This is fairly standard for all insurance companies.
What Are The Average Car Insurance Rates For Teens?
Typically, car insurance rates are going to go up when you add a young driver. Teens that are added on to an existing policy are not going to have to pay quite as much as teens who get their own policy.
Why Do Teens Pay More For Car Insurance Than Older Drivers?
Older drivers are far more experienced and thus more able to handle quick decisions that driving can present. Since young drivers lack that experience they are given a higher premium to make up for the risk factor.
Some stats about youth crash might shock you.
Teens must have the legal amount of insurance required by the state in which they reside. There are liability policies and there are also policies that are set up with comprehensive and collision coverages. These are optional but if the car is still being paid for they will be required by the loan company.
What Is The Best Auto Insurance Company For Teen Drivers?
If the parents have already established themselves with a car insurance company, it’s typically far less costly to add the teen to that policy than to get the teen on their own policy.
Always do comparison shopping and remember to do this annually. As premiums go up and down in the market the premium for your teen’s car insurance may also fluctuate.
Are There Any Mistakes To Avoid Overpaying That I Should Be Aware Of?
Don’t put your teen on your insurance policy until you have to. Thus, if they have a learners permit, it’s not yet required (by most companies) to have him or her on the policy. This can save you a lot of money in the long run.
This is especially true of the teen that isn’t in a huge hurry to get their drivers license. This can help you to save a lot of money on your car insurance premium.
Car Insurance Discounts For Teen Drivers:
To get discounts, teach them that it’s important that they are responsible when driving. One mistake and the rate can go up.
- The teenagers need to learn how important it is to maintain control and responsibility. Don’t take more passengers than the car should have, put the cell phones away and avoid distractions.
- Teens should also strive to maintain a B average to help with a good student discount.
- Avoid accidents and violations by following the law and practicing safe driving practices.
- Parents can teach them guidelines such as providing a safe location for their cell phone and teaching them that nothing, no phone call or text, is worth their life.
- Keep a clean driving record free of accidents and violations.
- Many states require that teens take an approved driver’s education course. If your state is one of them, make sure that he or she is enrolled and takes their studies seriously. If your state doesn’t require this class, enroll them anyway, it will go far in helping you to save on your car insurance and your teen will learn valuable skills for driving.
- Get several quotes from different companies. Quotes will vary. Consider combining home and auto for a multi-policy discount. It can net you some great savings.
- If your teen is away at school, there are some resident student discounts that you can talk to your insurance agent about. If your student doesn’t have the car all the better. The agent can set the policy up so that your teen is only on it when they are home.
- Choose a car that is lower risk. Make sure that the car has enhanced safety features and that it has crash protection. Typically, larger cars are far safer than smaller cars. Avoid SUVs, sports cars and trucks as these are considered far more dangerous.
- Consider increasing your deductible. Instead of a $250 deductible consider a $500 or even a $1000 deductible. This can net you some huge savings.
- Consider the year of your vehicle and whether or not you really need comprehensive and collision coverages. Older cars aren’t generally covered for this and you can save a lot of you’re able to let that go as well. However, keep in mind that if there is a wreck and your teen or you are at fault, you’ll be responsible for all of your own repairs.
- Ask your agent about “occasional” drivers. If the minor rarely drive one of your cars, ask if this status will help to reduce the cost of your premium. Consider putting your teen as the secondary driver on vehicles as well. This way, the primary driver is the one that the policy rate is typically based on.
- Some insurance companies have a “pay-as-you-go” premium. Ask your agent about this. If your teen rarely drives they may be eligible for this. It’s similar to the “occasional” driver status.
- If your state has specific rules such as teens only driving during certain hours, make sure that they are following these rules. Ensure that your teen doesn’t take too many passengers or if you’re in a state where they get a license but have to wait six months until they can drive friends, make sure that they’re obeying this rule.
- Go for a drive with your teen at the wheel and see how they drive. Don’t make them nervous but make a mental note to talk to them later about behaviors that you’re concerned about.
- Encourage them to check in with you when they arrive at their destination, this will give you peace of mind and if there are any issues they can tell you about them.
Following these tips will go far in helping parents to save on their car insurance if they have teens in the home who are going to be driving. Sit down with your insurance agent and talk about other ways to save as well. It’s a good idea to reevaluate your policy on an annual or a semi-annual basis.