How to Lower Car Insurance for a Teenager
Statistics show that teenage drivers are more likely than drivers in other age groups to get into an accident. Accordingly, car insurance is expensive for teenage drivers. The bad news is that you cannot escape these extra expenses. However, you can leverage opportunities to reduce the costs, in the following ways:
- Teach your teenager how to drive. Your children learn by example, observing and mimicking your driving behavior. That means it is up to parents to teach their kids how to drive by setting the best example, making sure that teenagers know and observe all the rules of the road, and ensuring that they realize what can happen if they disobey them.
- Invest in driver education courses. In addition to teaching by your own example, it is a good idea to enroll your teenager in an advanced driver's education safety course. This would be an extra-cost program that goes above and beyond the minimum state requirements to pass a driver's exam and road test. Give your teenager the opportunity to develop advanced skills in a controlled environment, where they can learn from mistakes before hitting public roads.
- Bundle policies to reduce rates. Before you start your search for insurance, keep in mind that most insurance companies offer discounts for bundling your car, home and life insurance policies together with the same provider. If your family hasn't consolidated policies with a single insurance company yet, now is the time to consider doing so as a way to offset the additional costs of adding a teenager to your car insurance coverage.
- Comparison shop for the best rates. As with any other purchase, it is always a good idea to comparison shop insurance policies to find the best rates. Start with your family's current insurance company, apply any teen driver discounts that might be available, such as good grades, a clean driving record, or any advanced driver's education courses, and then shop for identical coverage with other insurers.
- Put your teenage driver on the family policy. Once you've determined where you can get the best rate, and whether it makes sense to consolidate all of your family's insurance policies with that single provider, you should add your teenager to the family policy rather than purchase a separate policy for your son or daughter. By putting your teenager on the family insurance policy as a covered driver--as opposed to buying an independent policy--you can save money because all available family discounts will also apply to the teen. Additionally, you should see if your child can qualify for an occasional-use or pleasure-only driver discount. Adding a teenager as a primary driver costs additional money.
- Assign your teenager to the least expensive car to insure. If your household owns multiple cars, and you're benefitting from a multi-car discount, be sure to assign your teenaged driver to the car that is the least expensive to insure. In most cases, that will be an older model, with a smaller and less powerful engine, and a 4-door sedan or station wagon body style.
- Raise your deductible or drop coverage. If you've taken the steps listed above, but the insurance is still too expensive, you can raise your deductible or drop coverage to reduce the rate. Of course, this means you take on additional risk in the event of a collision. A higher deductible means you'll need to pay greater out-of-pocket expenses if an accident occurs, and dropped coverage means you'll need to pay all repair or replacement expenses out of your own pocket if the car is totaled in a wreck.