October 1, 2009

By-the-mile Insurance May Be The Best Option For Students

Two scenarios are possible when a student driver goes off to college. In some cases, they leave their cars behind, tempting parents to completely remove auto insurance coverage. And in others, students take their vehicles right along with them. This can lead to spiked auto insurance premiums because the car is no longer safely parked in a parent’s garage but on the streets of the university. In addition, the driving they will probably do is minimal, as students usually remain pretty close to campus. In either case, parents should resist the impulse to trim auto insurance on these vehicles – no matter how tempting it is. One only has to consider the sobering teen driver statistics to understand the importance of maintaining an adequate student auto insurance policy that. In some cases, students take their cars to school. So, what’s the best way for parents to go about insuring their students and their students’ vehicles when they go off to college at an affordable rate?

Consider the concept of by-the-mile auto insurance. Also known as pay-as-you-drive auto insurance, this type of coverage is based on how much a driver drives. Typically these policies are designed to cover up to 12,000 to 15,000 miles per year, saving as much as 25 to 40 percent on regular auto insurance costs. This means you can have the peace of mind that your student is properly insured, while your wallet avoids taking an unnecessary hit. No matter how much your student drives, there is going to be a monthly bill for insurance so it only makes sense to take steps to lower that overhead while you are budgeting for an education. Since it only makes sense to pay for something when it’s being fully used, this type of auto insurance policy makes for smart spending by parents. Just like turning off the light to save on energy costs, by-the mile auto insurance coverage switches off much of the auto insurance coverage expenses when your student’s vehicle is not in use.

The current state of the economy has caused concern among parents and teens that the increasing costs of obtaining a college education may limit the opportunities for the future. Many college funds took a hit in 2008, and rising unemployment means that families will need to seek savings wherever possible to afford to send their student to college. Owning a car is an unavoidable expense at times, making student auto insurance coverage a major, but necessary, expense for families of teen drivers. Pay-by-the mile auto insurance coverage just makes sense because it allows parents to consider spending less on auto insurance in favor of investing in their student’s future.