3 Reasons Why Teenagers Have Higher Car Insurance Costs
Teenagers have higher car insurance costs because of the assumptions car insurance companies make about young drivers. Three factors that impact your teen's car insurance rate are lack of driving inexperience, an assumed lack of maturity, and statistics that show teens have an inordinately high number of accidents while driving.
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UPDATED: Oct 12, 2021
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A teenager will definitely have higher car insurance costs as this segment of the population has several strikes against them when it comes to underwriting. Insurance rates are based on a variety of factors. The main 3 factors that impact your teen’s car insurance rate are his or her inexperience behind the wheel, an assumed lack of maturity due to age, and the fact that statistics show that teens have an inordinately high number of accidents while driving.
Auto insurance for older adults and those who are experienced behind the wheel will pay less than those who are not. In fact, gender plays a role in rates also, so if your teenager is a boy, expect to pay even more.
Check out the car insurance rates for your teenager today by inputting your ZIP code in the FREE quote tool on this page to get started!
By having a teenage driver in your household, the chances of an insurance claim are much higher than if all drivers are experienced adult drivers. For this reason, it is important to be completely honest with your insurance company and list all drivers, even the costly ones who may drive only rarely. In addition, prudent car owners increase their liability insurance when they have teenage drivers, as the risk of serious accidents is higher.
Understanding Car Insurance for Teenagers
There are some aspects of car insurance for young drivers that are not commonly known. One of the most significant ones is the fact that not all insurance companies treat teenagers the same way. In fact, many companies arbitrarily designate the teenage driver to be the driver who will be using the most expensive car that you have on a policy. This is so the premium is highest, however many parents will not even let their teens drive the most expensive car they have.
As you check around for coverage, ask about the possibility of assigning the least expensive car to the highest risk driver, in order to minimize the cost of coverage.
This will also mean that your teenager will be limited to one vehicle, even if you have multiple vehicles. Otherwise, you could face some problems if you were to make a claim.
Another point to remember is that adding your teenager to your policy will always be less expensive than letting him buy his own policy. Putting all vehicles on the same policy will also usually get you a multi-vehicle discount, which helps bring the cost down.
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3 Best Ways to Save on Insurance for Your Teenager
While car insurance for your teenager can be a costly undertaking, there are things that you can do to help keep the price as low as possible. Be sure to shop around and get a variety of different quotes from different insurance companies. Compare these quotes before making your choice to be sure you have the best coverage at the best price. Look at price, reputation of the company, coverage and other factors before making your choice.
- Look at Your Coverage! If you carry full coverage on the car your teenager drives, consider raising the deductibles for collision and comprehensive. By doing so, your premiums will be lower. Alternatively, if your vehicle is paid off and the value is not high, you may want to forego collision and comprehensive coverage in order to save money.
- Don’t Pay When they Don’t Drive! Make sure that you are not paying for coverage when your teen is not driving. If your teen goes away to college and does not take a car with them, you should make sure your insurer knows it. They will typically reduce the rate, especially if the school is more than 100 miles from your home.
- Find a Discount! Be sure that you are aware of any discounts offered by the company you choose to get coverage with. Some offer a discount if your teenager gets B or better grades in school. Others offer a discount for successful completion of a driver-training course.
Choosing the Best Coverage for Your Teen
As you shop around for car insurance for your teenagers, you will want to do the same things you would do when shopping for any car insurance. Be sure to check out the stability of any company you plan to get insurance from. Independent car insurance ratings companies like A.M. Best are a good source to determine if the company is financially stable.
You can also check out how a company fares according to those who actually use it. Independent research firms like J.D. Power and Associates; compile feedback from actual consumers on a variety of important factors in regards to insurance.
Knowing what others say about the insurer you are considering will help you make your choice.
Make your car insurance shopping a breeze by using the quote tool on this page; simply input your ZIP to begin now!