Car Insurance for Teens: How to Find the Cheapest Rates

Car insurance rates for teen drivers can vary widely. Read on to learn about car insurance for teenagers and how to save money on teen auto insurance.

Auto Insurance for Teenagers

When it comes to auto insurance rates, driving experience matters, and teenage drivers simply don’t yet have it. Even though it takes time for a teenage driver to acquire a good driving record, there are ways you can save on car insurance premiums for your teen’s auto insurance from the time they receive their license.

The cheapest way to insure a teenage driver is by adding them to your own policy. Buying a teen their own policy is very expensive and generally not advised. Depending on the state, a teen driver’s annual premium could cost up to twice as much on an individual policy as being added to a parent’s policy. Even so, parents are usually surprised when they see how much rates spike when their teen is added to their policy. That’s why shopping around for the best teen car insurance rates and coverage is essential!

What’s the Cheapest Way to Insure a Teen Driver?

According to a recent study by Coverage.com, the average rate increase for adding a teen driver to a policy is 130%! The study shows that adding a male teen driver sometimes has a larger rate impact than a female teen and that overall impact varies a great deal from state to state. That’s why it’s important to do your research and read these tips before choosing car insurance for your teen.

Find a Teen Driver Discount

Some insurance companies offer discounts to help you save on auto insurance for teens. These can include good student discounts for those with at least a B average or a 3.0 GPA.

Passing a defensive driving course may also reduce rates. According to the National Safety Council, those taking defensive driving courses have lower accident rates and, in turn, lower insurance premiums. Depending on the state and your insurer’s guidelines, completion of such a course can reduce rates by as much as 10%.

Available online, these classes teach students techniques to use in emergencies, how to handle stressful driving situations, and how to anticipate and react to potential hazards. They learn to recognize dangerous and potentially threatening conditions as well as how to avoid them. All in all, it’s sound advice to enroll your teen driver in education programs. The more prepared they are, the less likely they are to be involved in an accident, and we all know how an accident affects auto insurance rates! 

Perhaps your teenager is not using the car a great deal. If your teen is listed as a secondary or occasional driver, you could potentially save money on the premium.

Keep in mind that, if your teenager is away at college and is not driving a vehicle, many insurance carriers will lower the premium during that period. Make sure to inform them if your teenager is not able to drive for a significant amount of time.

Raise Your Deductible

You can save money on your teen’s insurance premium by raising the deductible on your vehicle if you carry collision and comprehensive insurance. For example, if your current deductible is $500 and you raise the amount to $1,000, you will save money on your premium. That means you must pay out of pocket for repairs costing less than $1,000, but maybe that’s a deal you can make with your teenager. Let’s say they get into a minor car accident and repairs are under $1,000. Your teen should understand that coming up with the money is their responsibility as a new driver. Just make sure you have the funds to cover the costs if or when your teen can’t do so.

Choose the Right Car

If your teenager wants his or her own car, buy them a safe, older vehicle in good working condition that doesn’t require collision or comprehensive coverage. Young people may want the flashy sports car with a powerful engine, but such high-end autos really increase those insurance rates, especially for teen drivers! Old vehicles are usually cheaper to insure, leading to more affordable premiums for your teen.

If you take out a loan to purchase your teen a car, you’ll probably require collision or comprehensive coverage. However, if the car has advanced safety and crash protection technology, you may be eligible for a discount. On average, older vehicles cost less to repair than newer models but have older safety technology.

If you are shopping for a car for your teen’s use, check online to calculate premiums by comparing car makes and models. You can also speak with or email an insurance agent to learn which models are the best value when it comes to a teen’s car.

Your teen can also save money if they own their car by bundling their insurance with yours and receiving a multi-vehicle discount, if available.

Raise Your Liability Insurance

Buying additional liability insurance once your teenager starts driving doesn’t sound like a way to save money. However, while you will pay more in car insurance premiums, you are protecting your family and your assets when an inexperienced driver joins your policy.

All states have minimum amounts of liability insurance that drivers must carry. Many people carry more than the minimum in case they are involved in a serious accident. Because teenage drivers are more likely to get into accidents than other drivers, paying a little more for liability insurance can put some of your financial concerns to rest once your teens take to the highway.

Do the Math

While it is almost always cheaper to insure your teen driver by adding them to your policy, there are exceptions. That is why you must do the math before figuring out your best insurance options.

It’s vital to understand how insurers rate teenage drivers. If you have several vehicles on the policy, the insurance company will usually rate the new driver for all vehicles, not just the one set aside for your teen’s use. If every car has full coverage, meaning collision and comprehensive insurance as well as liability, getting your teenager a separate policy could be cheaper than adding them to yours. Many insurers will offer a discount on a separate teen policy if they live under your roof.

You can also discuss alternatives, such as excluding the teen from driving the other vehicles. However, that could end up causing inconvenience if the teen’s car is undergoing repairs or otherwise unavailable, and they cannot use another family car due to lack of insurance.

Compare Quotes

Compare online quotes and see which company has the best insurance for teenage drivers. While price is a big factor, the best quote is for coverage that meets your needs and that of your new driver, while still being affordable.

Teen Drivers and The General®

At The General®, we specialize in providing car insurance for teenage drivers and others considered high-risk by insurers. Get quoted for a car insurance policy for your teen in under two minutes and see how much you can save or read more articles about safe driving on our insurance blog. Have a tech-savvy teen? They can download our mobile app and manage their policy conveniently from their smartphone.