17 Apr How to Save on Your Teen Driver’s Car Insurance
When do you need to list your teen driver on your car insurance policy and how can you make this additional coverage fit in your budget?
It is certainly not inexpensive to get car insurance coverage for a new teen driver.
When a teen driver is added to their parent’s policy, the typical insurance premium for a one-car family is likely to increase by about 40-50%. If you’re a multi-car family, then you will probably see your insurance rates go up even higher. And, if you’re opting to reward your new driver with a car, and expecting them to secure their own insurance policy, you should prepare yourself – or your teen – to pay at least a couple thousand dollars in car insurance costs.
So, we understand why parents might want to hold off on getting auto insurance for their teen driver until absolutely necessary. However, even if you think your teen will only occasionally be borrowing the family car, the fact is they are now a licensed household member. As such, if you do not add them to your current policy as a covered driver, you risk being denied by your insurance carrier for any future claims, having your coverage terminated, or both. In addition, should you decide that you want to shop around for a better car insurance rate, you will also need to make sure your teen driver is listed on all of your insurance applications so that you get an accurate quote and adequate coverage.
At HUB International, we are happy to help you explore all of your coverage options and available discounts to keep your costs reasonable once your teen becomes a full-time driver.
Six tips for saving money on your teen driver’s car insurance
At HUB International, some of the strategies for saving money that we discuss with our clients include:
- Taking advantage of discounts such as Good Student, which rewards teens with a grade point average of “B” or higher. If your student is eligible for this discount, it may save you hundreds of dollars on your car insurance premium.
- Completing defensive driving courses can also earn you and your teen significant monetary credits towards your policy premium. Even more, your teen will hopefully drive away from this course with a better understanding of how to keep safe behind the wheel. Since even minor fender-benders can drive up your insurance costs, it’s critical that your teen – as well as all other family members listed on your policy – do their best to keep their driving record clean of any accidents and moving violations.
- Investing in Accident Forgiveness can limit the financial impact in the event your teen does get in a car accident. Since 16-year-olds have higher crash rates than drivers of any other age, we recommend that our clients with teens strongly consider this endorsement which can cancel out the surcharge points that are typically assessed by your insurer after an accident.
- Sharing a vehicle with your teen rather than giving them their own vehicle may allow you to classify your youngster as an “occasional driver” rather than the primary driver, which is another excellent way to keep your insurance rate lower. If you decide, however, that your teen will need a car of their own, it may make financial sense and keep your insurance costs down to assign them as the primary driver of the family vehicle that is the least expensive. Are you adding a vehicle to your household for your teen to drive? Look for a car with safety elements, such as anti-lock brakes, air bags, and anti-theft devices, as insurers will often reward you for having these features with lower car insurance rates.
- Monitoring your teen driver with today’s technology can not only help you keep an eye on your teen when they are on the road, but also earn you discounts on your car insurance premium. Some insurers are now offering devices to parents that can be installed under a car’s dashboard and that create a report card of your teen’s driving behavior. Information may include the number of miles the car covers, how fast your teen is driving, the hours the car is on the road, and how often your teen slams the brakes. Insurers with this program are providing discounts ranging from 15% to 30% to drivers who achieve predetermined safe driving benchmarks.
- Raising your deductibles which in turn lowers your premiums. However, this is only a smart choice if you are comfortable knowing that you might end up having to pay a larger share of costs for an accident out of your own pocket.
The team at HUB International has helped thousands of families like yours across New England adapt to having a teen driver in their home. We know that your child’s newfound independence is exciting but may also cause you some stress and anxiety. As your insurance partner, we want you to know we will not only focus on finding you competitive rates for the newest driver in your household, but we will also make sure that your coverage provides the optimal protection for your family’s increased insurance needs.
HUB can help make sure you and your teenager are insured properly
While there is a natural desire to look for ways to cut costs on your insurance as your teen becomes a full-time driver – and drives up the cost of your premium – it’s definitely not the time to decrease your coverage limits or eliminate optional coverages. In an effort to save money, you could leave your teen and all other drivers in your home dangerously underinsured and at financial risk should they be involved in an accident.
Instead, it’s an excellent time to review your current auto policy with your insurance agent. At HUB International, we strongly recommend that our clients with teens carry more coverage than the state’s minimum required auto insurance levels and that they opt for additional coverages such as collision and comprehensive. We also want to make sure that they are taking advantage of commonly overlooked car insurance policy options that can save them money, stress and time like Bundle & Save, Disappearing Deductible and Loan/Lease Gap Endorsement.
Finally, because teen drivers are unfortunately an accident-prone age group, once your child gets behind the wheel, your liability risk inevitably increases. So, it’s not a bad idea to consider adding an umbrella policy to your insurance solutions for those worst-case scenarios where your teen is in an accident and is found at-fault for bodily injuries to others or damage to other people’s property. For a minimal investment, this type of coverage may give you the peace of mind that your savings, investments, retirement accounts, and your family’s financial future are protected from an accident-related liability claim.
The most important thing to know, though, is that in the event your teen is ever in a car accident, the HUB International team will be here to help the claims process go as smoothly, quickly and fairly as possible.
If you’re ready for a more personal relationship with a trusted insurance agent who can help you make an informed decision about car insurance for your teen driver, please call us today at (800) 243-8134.