Car insurance rates are based on driving and accident statistics, which are simply not very good for young drivers. Teens continually record the highest possible rates of both fatal and nonfatal crashes when compared with all other age groups. Teenagers are disproportionately involved in more accidents based on miles driven, with an extremely high fatality rate in comparison with older, more experienced drivers. This higher level of risk is reflected in young drivers insurance rates.
Graduated Driver Licensing is an approach used in most U.S. states in an attempt to reduce teenage accidents along with the resulting deaths and injuries. This is accomplished by gradually phasing in young driver permissions, such as driving alone or, nighttime driving – usually between ages 15 and 18.
Parents should also actively train their young drivers about safety and road knowledge. In addition, it’s wise to create and enforce rules such as turning off cell phones while driving, obeying the rules of the road, and abiding by curfews. These can lower the cost of insurance for young drivers over time by creating a more disciplined, safer driver.
Tips for Lowering Car Insurance Rates
- Including the young driver on the parents’ insurance policy can save money. It will definitely increase the parents’ premium, but in most cases will be cheaper than buying a separate policy for the young driver.
- Many insurance companies offer policy discounts when teens maintain good grades (usually a “B” average) and taking driving courses. Every discount helps!
- As the young driver gets older, rates typically drop. At age 19, the cost of insurance for young drivers can drop by as much as 28 percent. At age 21, rates could drop even more assuming a good driving history.
- Compare different insurance company rates while shopping for comparable coverage to find cheaper insurance quotes. Most insurance companies offer a discount for having multiple policies with the same insurer.
- And last but not least, try to maintain a good credit history (yes, it matters!), a clean driving record, and continual insurance coverage without lapses to qualify for as many discounts as possible in the future.
It’s important to keep these tips and suggestions in mind when adding insurance for young drivers. You’ll be glad you did!