You know raising a child is going to be expensive the moment you see the hospital bill for your delivery. You probably started a college savings program for them when they were still very young, but have you thought about how expensive it will be to include them in your auto insurance policy when they’re 16?
It doesn’t matter how you want it not to be, because insurance for young drivers is more expensive than for older drivers. There are a number of reasons for this cost differential, and insurance companies know them all. Statistics show that young drivers are involved in more accidents than the rest of the general population. Young drivers have limited driving experience, so the insurance company must bet on that unknown factor as well as a non-existent driving record. Insurance companies are all about the risk factor. If you are someone with a lower risk, they can afford to charge less for your insurance; however, if you bring a lot of risk or unknowns to the table, they will charge you more because they are taking more risk.
However, that doesn’t mean you can’t find auto insurance coverage for your teen driver that’s lower with one company than another. Sometimes, if you’ve had a policy for years with a company, your good driving record will translate into a lower price for your young driver. This is rare, but it happens occasionally, and you’ll want to take advantage of it. However, if this isn’t the case, you’ll want to shop around for a better price elsewhere.
Because your teen driver is part of your household, your family auto insurance will want to keep him covered even if you opt for a separate plan for him, because it’s reasonable to assume he’ll still be driving the family car from time to time. Finding cheap auto insurance to switch not only your teen but your entire family can really save you money. There are many options offered by insurance companies, so when shopping around, you’ll want to make sure you understand what’s on offer. See the differences if you insure just your teen driver and the car they’ll be driving, or if you insure all the family cars together.
You can find discounts for your first driver if he or she is a good student, which is one of those great motivators to help your teen keep their grades up. Sometimes there will be discounts if they took a certified driver training course, and if you have more than one car on the policy, there are usually discounts for multiple cars. If you buy your home insurance through the company or some other type of insurance through the same company, there may be additional discounts.
There are different amounts of coverage available for automobiles, and when the price of young driver insurance is so high, you may be tempted to go with the lower amount of coverage to save money. However, this is not a great idea, because that minimum coverage may be just enough to pay for the cost of an emergency room visit in the event of an accident. If your teen is purchasing a car with a loan, they will be required to have the full amount of coverage. She may want to do comparison shopping and find a happy medium if the car isn’t bought with a loan. By exploring your options and comparing what’s available, you’ll be able to find reasonably priced coverage for your teen.