Six Ways to Lower Car Insurance Costs for a Young Driver

February 21, 2018

As your child turns sixteen there’s likely some excitement and trepidation. As he gets behind the wheel of a car, you hope that you did everything you could to keep him safe. However, you also need to protect yourself in the form of car insurance. If your teen is involved in a car accident, it could end up costing you a fortune.

Just like you carry insurance for yourself, you’ll need it for your young driver as well. However, if you’ve ever heard someone else talk about the insurance rates for young drivers, you know you probably need to start saving.

Before you let your teen’s insurance put you in a financial bind, consider the following six ways to minimize those costs.

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Require Good Grades

Many insurance companies reward teens that have good grades. Studies show that drivers with good grades are less likely to get involved in a car accident. Allstate, for example, offers as much as 20% off the typical teenage rates for teens with good grades. At most insurance companies, this means maintaining a ‘B’ average and carrying a full load throughout high school or college. The discount applies to students all the way up to age 25.

Encourage your child to hit the books not only because it will get him farther in life, but because it will reward him with driving privileges. Students that don’t have the ‘B’ average could cost their parents as much as 25% more in insurance rates.

You can prove the good grades by providing your insurance agent with a copy of your child’s report card.

Take a Safety Course

Many insurance companies offer discounts when teens enroll in driver safety courses. Each insurance company has different requirements in order to get this discount. For example,  Allstate offers a teenSMART program. This tutorial gives advanced training beyond what your student will receive in standard driver’s ed classes. Other insurance providers have similar options. Ask your insurance agent what your insurance company offers. You stand to save as much as 20% off your insurance premium.

Use Today’s Technology

Technology can help you keep track of your child’s whereabouts as well as his driving habits. If you accept the terms, your insurance company may provide a small device that you install in the car. This device lets you know your child’s driving habits. You can learn things like the speed your child drives, how hard he hits the brakes, and even the number of miles driven.

Oftentimes this information also goes to the insurance company. In exchange for the information you share, many insurance companies provide you with a hefty discount, sometimes up to 30% off your premium.

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Purchase a Safe Car

You obviously want your child to be safe on the road, but buying a safe car can also help keep your insurance rates in check. Talk with your insurance agent about the make and model of any vehicle you are considering. Oftentimes, teens drive older cars just because it’s what parents can afford. It’s a common belief that insurance on new cars is too expensive. However, with today’s technology and safety involved in the newer vehicles, you may be able to save even more on insurance with a new car.

Talking to your insurance agent about the options you have will help you determine the right car for your child. Taking insurance into consideration can really help you decide which car works best for your teen.

Add Your Teen to Your Car Insurance Policy

It might be tempting to get your teen his own policy, especially if you worry about collisions and your rates increase. However, it doesn’t pay off. Insurance companies prefer teens be on your existing policy. You can add him/her as a part-time driver, which only increases the rates slightly. You’ll also be privy to a discount when you add another car to your policy. Many insurance companies provide the multi-vehicle discount, making the insurance even less expensive.

Inform Your Agent About Your Child’s College Choice

If your teen goes away to college, you’ll want to let your agent know his whereabouts. If he attends school more than 100 miles away from where you store the car, you could get a reprieve on the insurance. You won’t have to cancel your teen’s insurance, but you’ll get a discount while he is away. This way you have your cake and can eat it too. You save money and your teen still has coverage when he comes home for visits.

Car insurance is required in most states and it just plain makes sense, no matter how old you are. For teens, however, it could really help save you from financial destruction in the face of disaster. Talk to your insurance agent about the many discounts available for car insurance for teens and see how much you can save today!

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