Tips For Managing The Auto Insurance Costs Of Teen Drivers
Obtaining a driver's license can be one of the most exciting times in a teen's life because it allows them to have some sort of freedom. Parents can also relish the fact that their teen has accomplished something great. They can also begin to give their teen more responsibilities and allow them to grow as a person. But with driving also comes dangers and considerations that must be dealt with. While many parents are concerned at first with getting their teen a car or finding the time to allow them to use the family car, they forget about the insurance aspect of driving. Auto insurance costs have been rising in the last few years for many different reasons. Teen drivers in particular experience high costs for auto insurance because of their lack of experience on the road. However, there are ways that parents can manage the auto insurance so that costs remain low even for teen drivers.
Auto insurance costs for teen drivers are high because teens have little to no experience on the road. That inexperience combined with their youth can sometimes result in any number of car accidents. For insurance companies, that combination spells trouble and puts them in a high risk group since the company will likely have to pay out a claim. Getting full coverage for a teen or putting them on their own policy are two ways to keep costs high.
To keep costs lower, it is a good idea to put the teen under a parent's car insurance policy. This way, they can combine with their own insurance and put them on a policy of a lower risk individual. Also, keeping the deductible at a reasonable level, say $500 or even $750 can help keep the costs affordable while still providing the teen with the right kind of coverage.
There are also discounts that parents can take advantage of for their teen drivers. There are discounts for good grades and staying on the honor roll that can help lower the monthly premium significantly. Just by having studious teens, parents can keep their costs low. The only proof the insurance company will need is the report card for that student — the most recent one works best. The longer they stay on the honor roll, the better the discount for some insurance companies can get.
It may also be beneficial to get the bare minimum coverage for a teen and purchase a used car for them. A new car means higher expenses and combined with a high amount of coverage, the risk becomes big for the insurance company. A car that is a couple of years old can save a lot of money.
