Teenager Car Insurance
It feels like just yesterday you were celebrating your child's first birthday. Fast forward 15 years and it is time to start discussing driving privileges and whether or not your teen is responsible enough to stop taking public transportation and start driving on their own.
The idea of your child spreading their wings and enjoying the freedom that comes with driving a car can be just as scary as the thought of how much you will pay for teenager car insurance.
When a teenager goes from a learner with a permit to a licensed driver, they need to be insured regardless of whether or not they own their own car or share with an adult in the household. Car insurance for drivers who have just recently passed the written and practical driving test can be pricey.
As you begin to price shop, you will see just how much of an affect one inexperienced driver has on the insurance policy that you have had for years.
With teenager car insurance being so costly, it is very important that you know what you are buying. Buying a standard policy for an experienced driver can be frustrating, but buying coverage for a high-risk teen becomes an even greater task.
If you would like to learn about how teens can affect your premiums and how you can keep these premiums low, read this straightforward guide to obtaining teen car insurance.
Why are teenagers classified as high-risk drivers?
A high-risk driver in the car insurance marketplace is a driver that cannot receive preferred rates because they are not a good driving risk. There are a variety of different reasons why someone may be called a high-risk. These reasons
There are a variety of different reasons why someone may be called a high-risk. These reasons include:
- bad credit
- DUI convictions
- serious accidents
- gaps in coverage
- being inexperienced
Perhaps the biggest category of high-risk drivers are teenagers who have just been licensed.
Accident Statistics
There is a long list of reasons why teen drivers fall into the high-risk group, even if they have clear records and no accidents. Perhaps the biggest reason is because adolescents who are newly licensed are most likely to get into an accident within 6 months of getting their license.
All teens between 16 and 19 are three times more likely to be in a fatal accident.
Beyond that, teens between 15 and 19 are responsible for $26 billion of injury costs resulting from car crashes. While insurers may not pay all of this, a majority of these costs come out of the insurer's profits.
Risk Factors
Studies have shown that teens simply think differently than adults who have fully matured brains. An adolescent has a brain that has a little maturing left to do.
They may act more impulsively and without thinking about consequences. They could be easily distracted by others on the road, mobile devices, and radios.
These risk factors that are common on the road may not affect you, but they will have a greater impact on a new driver who is not yet an adult.
Recently, studies have also uncovered that lack of experience and lack of sleep contribute to response times and poor decision making. With early school start times and lax rules, teens are lacking the rest they need to respond to hazards on the road.
The lack of sleep is also contributing to high accident rates and premium rates for drivers who are not called adults in society.
How much is insurance for a young driver?
The cost of insurance is not the same from one person to another. Even if you and your sibling were to insure the same vehicle in the same neighborhood, you and your sister would pay varying rates. This is because companies use a long list of rating factors to assess risk.
It is not just the vehicle and the territory that helps determine your rates, it is also your age, gender, usage, and driving record.
If you are wondering how much you will pay for teenager car insurance, the number depends on all of the rating factors.
You will need to consider the teen's age, gender, how many years they have been licensed, the style of the vehicle, how many miles the teen drives, where the vehicle is parked, and what the record is of all drivers on the policy.
Average Premiums
There is not just a fixed number that accounts for how much a teen will raise your premiums. If you really want to know, you will need to call your agent and discuss your situation so that you can receive a quote.
It can be helpful to learn about the average premium increase just so that you are prepared for the sticker shock.
According to a study conducted by InsuranceQuotes.com, adding a teen to an existing policy will raise the policy premium approximately 79%. There is a difference between the surcharge for males and females.
Females who are under 20 will contribute to a 67 percent increase, and males in the same age group contribute to a 92 percent increase. It is not until the driver gets 3 years of experience that they will qualify for a good driver discount with a clean Motor Vehicle Report.
When to Expect Rate Decreases
Every company and every state has its own rules, but typically a carrier will offer a few breaks to teen drivers as they begin to show that they do not drive aggressively. The first decrease will appear around the three-year mark, where the driver could become eligible for accident-free and good driver discounts.
The next mark may be around 5 years, and the biggest decline comes when there are nine years of verifiable driving experience. For those who are licensed at 16, 25 is the golden age where they will finally be charged standard rates.
How can you keep teen car insurance rates as low as possible?
It is only natural to want to pay the lowest possible premiums for car insurance without sacrificing coverage. With car insurance being a form of protection that you do not want to use, it is up to you to exercise your rights as a consumer to find low-priced premiums and quotes chalked full with discounts.
There are a handful of ways that you can keep the premiums down for a teen, you just need to be a resourceful person.
Here are some valuable tips that you should reference while you are searching for teen car insurance:
– Add your Teen to your Policy
Some parents may want to insure their teen separately, but this could be a very expensive decision. When you add your teen to your own policy, you will receive free coverage until they are licensed.
After they are licensed, the cost to add the teen with or without a vehicle is much lower than buying a separate policy. The reason this is the lower-priced option is because the parent will qualify for standard rates. The multi-car and loyalty discounts can also bring rates down significantly.
– Give an Incentive for Good Grades
Did you know that good grades can really pay off? Insurance companies offer discounts when teens show that they are responsible for their age.
For most companies, full-time students who are under 25 will get a discount if they earn a B average or better. Check with the insurer to find out what the criteria is for the Good Student Discount. To receive this each year, the student must provide an updated transcript.
– Shop for Insurance Before Car Shopping:
Most consumers know that a Mercedes will cost more to insure than a Toyota sedan. What you might not know is that inexpensive vehicles can still carry high rates when specific age groups tend to drive the model.
Insurance companies do not just look at the value of a vehicle when setting the insurance rates, they also look at the car's claims and safety record.
If the vehicle has bad crash ratings or it has a structural design that causes a lot of damage, the insurance rates will be high. You should always review the costs to insure vehicles that you like the most before you go to a dealership or a private seller. This can help you avoid the pricier vehicles altogether.
Teens need quality coverage, but you also need to find coverage that you can afford to maintain. There are several ways to save on teen insurance, but you must be prepared to comparison shop to find the best rates.
The best way that you can comparison shop is to use an online tool that gives you instant rate quotes from carriers in your zip code.
These tools are advanced and make the process of sifting through all of the endless quotes quickly and easily. Enter your information in the fields, select coverage, and buy affordable teen insurance.