Two phrases that typically do not go well together are “car insurance” and “teens and young drivers.” So what’s the problem? Prices. Teens and young drivers pay the highest prices in the car insurance industry. In fact, they can be high enough to cause a real financial burden on young people.
As the parent of a teen or young driver, you may be asked to shoulder some of the financial responsibility for the time being. There are things you can do to help keep a young driver’s premiums as reasonable as possible. Let’s discuss some of those things.
Your Policy, Your Car
The reason young drivers pay so much for car insurance is that they are more dangerous behind the wheel. Statistics from the CDC show that young people between the ages of 15 and 24 are responsible for 30% of all traffic accidents in America, despite making up only 14% of the total number of drivers on the road.
By keeping your teens and young drivers on your policy, and driving your vehicles, you reduce the risk enough to see a difference in insurance rates. Insurance companies assume a couple of things here:
- Less Frequent Driving – Since everyone in a household must share common vehicles, having your teen drive your car means he’ll have less access to it than he would his own vehicle. In theory, this reduces both the amount of driving he does and the likelihood he’ll have an accident.
- More Responsible Driving – The other thing car insurance companies assume is that teens and young drivers are more responsible with their parent’s cars than they would be with their own. This increased sense of responsibility hopefully leads to safer driving.
When you add a teen or young driver to your policy, your insurance company will automatically assign that driver to the most expensive vehicle. They do so as a matter of protecting themselves. But be aware you do not have to settle for those default assignments.
Instead, you can insist your young driver be assigned to the least expensive vehicle. In so doing you will reduce your annual premiums. Assigning a driver to a specific vehicle does not mean he can only drive that car. It simply means that’s the car he will drive most often.
Ask About Discounts
Discounts are great way to save money on your car insurance. Where teens and young drivers are concerned, one of the more popular discounts is one given for good grades. Assuming your young driver is still in high school or going to college, he could qualify for the good grades discount by furnishing a copy of the appropriate paperwork from his school.
You may also qualify for additional discounts including those for multiple drivers, multiple vehicles, safe driving, and bundling your policies together. As long as discounts are available, you might as well use them to offset the cost of insuring a young driver.
Educating Young Drivers
The most important thing you can do where young drivers and car insurance is concerned is to educate those drivers. Most young people do not understand how the insurance system works and, as a result, it never occurs to them that the way they drive will affect how much they pay.
Educate your teens and young drivers about the importance of being safe and legal at all times. Even the slightest blemish on their driving histories could increase their premiums. Eventually your teens will grow up, move out, and get their own vehicles and car insurance. Until then, make sure they know how things work.