Many families search each year for cheap car insurance for their teenagers. Even though coverage is easy to locate, the outrageous cost of premiums is a real problem for many families.
Teenager car insurance premiums will vary in cost by state and local price factors, but the average yearly rates in the United States for teens is over $3,500. Another way to estimate teenager rates for your area is to multiply the parents’ yearly rates by 2.5 to 3 times. This will give a general idea of the expense you’re about to incur.
Since teenager car insurance can really impact family finances, it’s wise to seek out and take advantage of all available discounts offered by insurance companies. Here are 3 important tips for saving money on teen car insurance:
1. Insure the right vehicle. Teenagers will already be rated in the highest risk class. Don’t increase your premium costs by allowing the teen to drive certain types of cars. Avoid luxury cars, any car with a high performance engine, tiny lighter cars, and large SUVs (not only are SUV insurance costs higher due to rollover risk, these are harder to maneuver in and out of traffic for a new driver). Sometimes it will be cheaper to actually purchase a somewhat older used, mid-size vehicle for the teenager. You can also raise the deductible, and if the car is paid off, collision and comprehensive insurance can be eliminated to save even more. Cars that aren’t stolen as often will also be less expensive to insure.
2. Take advantage of a Good Student Discount if possible. When a teenager makes good grades, usually at least a B average, they generally qualify for this discount. This can add up to 10-15% savings on insurance rates for the teen. If the teenager is away at college and doesn’t drive often (limited access to a vehicle), you can apply for a Distant Student Discount with many insurance providers.
3. Defensive Driving Courses. Most insurance companies will provide discounts if a new driver successfully completes a defensive driving course. These are available in most cities, and there are plenty of online resources to help. This shows the insurer that the teenager is interested in being a responsible driver, and also helps with the education process. Parents should take the time and energy to train the teen driver, and set expectations and rules for them to follow. This will be time well spent, since positive early driving skills and knowledge go along way toward developing a safe driver.
Most of us are of the opinion that there is no such thing as cheap car insurance for teenagers, but if you take advantage of the several options you have to reduce the cost, savings can really add up.