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Car Insurance For Teens

Written by Todd Clay. Posted in Research Last Updated: 10/30/2008

Essential checklist when buying auto insurance for your teenager

A new chapter in your teen's life.

A new chapter in your teen's life.

Ahhh, teen drivers and their car insurance.

It wasn’t so long ago you were in the same seat, ready to show off your new wheels to friends.  But before getting too nostalgic and hand off the keys, you need to get some your teen insured.  Don’t get caught without a policy when they take to the streets.

Buying auto insurance for your teen is not much different from buying it for yourself.  Basics such as picking a reputable company and getting enough coverage to cover your situation still apply when choosing a company.  But there are some essentials you should consider before signing a policy.

Teen Drivers Are Dangerous?

I know, I know…your teenager is a very safe driver.  But I’m not talking about your teenager.  I’m talking about all the other dangerous, young, hormone-driven motorists on the road.

Fact is, according to the Insurance Institute for Highway Safety, 16-year-olds are nearly six times more likely to get into accidents than drivers aged 30-59.  To a car insurance company that translates into one thing: higher premiums.  Know that you will pay more for the teen driver in your household.  But that’s only part of the story.

Help Your Teen on the Road to Success

The scary part is that auto insurance rates can go up from there.  One at-fault accident and your perfect angel’s rates could jump 10%…or more!   That’s why it’s important to help your young driver get experience.

Take frequent trips with them at the wheel.  The more they drive with you, the more comfortable they will be at the wheel.  This will help them, but it will also help you when you’re mailing in your premium check.

On the flip side: if your teenager bucks the trend keeps a clean record (no accidents & no tickets), many companies offer additional discounts.  Make sure you ask about them when getting quotes.  It never hurts to ask.

Submit Grades for Better Car Insurance Rates

Auto insurance for teenagers is high enough.  Any discount will help lower the burden on your wallet.  That’s why it’s important to submit your teenager’s grades to the company.

Most companies give a good student discount for premiums.  Having your teen maintain a 3.0 GPA or better will help lessen the strain on your checkbook.  Maybe you could pass on some of the savings to your teen – the discount will be more than enough to pay for a movie every policy renewal.  It’s a friendly reminder for them to keep up their grades.

Higher Deductibles Can Save Money for Teen Drivers

If you’re getting full coverage (comprehensive and collision) for your teenager’s car insurance, then you know about deductibles: the higher your deductible, the lower your premium.  In other words, the more financial responsibility you assume for teenage driver, the less you will pay to the car insurance company.

That’s why you should consider upping the deductible on the comprehensive and collision portion of your teenager’s auto insurance.  Instead of a $100 deductibles, consider going to $250 or $500.  Sure, it’s more responsibility for your family – but it could pay for itself in a year.  Put the savings in the bank in case something happens.

Can I Just Add Them To My Policy?

Before collecting auto insurance quotes, ask your current insurer if you can add your teen to your policy.  Some states allow this, while others do not.  Either way, most agents will be able to advise accordingly.

A note of caution: if your teen has a driver’s license, they must be insured on some vehicle.  If your car insurance company doesn’t know about your teen driver, your company could drop your policy – whether or not anything happens.  And you thought it was expensive before, you were cancelled – it’s downright depressing afterward!  If possible, just add your teen driver to your policy when they’re licensed.  It’s the safest, and ultimately cheapest bet.

Before You Hand off the Keys

After you pick up car insurance for your teen driver, they’re almost ready to hit the road.  Help them with the basics behind the wheel – if they get a ticket, make sure they take defensive driving, and if you want to help their sense of responsibility, make them pay some of the premium with a part-time job.  All these things will help you feel more comfortable guiding your teen through their first years of driving.

Now, where are those keys?
Did I miss anything? If you have something to add for other parents, just a leave a comment to help them out.

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Todd Clay

Todd Clay is a former insurance agent with the largest insurance company in the United States. He earned his Bachelor’s from the University of Texas. He’s worked in several fields but has specialized in insurance, financial-related information, and technology. He blogs at Car Insurance Guidebook.

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  • Todd Clay

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    Not sure, Samantha. I get the images from iStockPhoto so she could be anyone. I picked her for her youthful appearance.

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  • Samantha

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    Who is that model in the picture?

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