If you’re a parent, you likely have mixed feelings when your teen becomes a licensed driver. It’s a relief to know your days of playing chauffeur are over. But the cost of insuring your new driver may be frightening. Here’s how to reduce auto insurance rates for your teen and maybe calm your fears at the same time.
Buy used and save
Teens are generally more expensive to insure. To keep policy costs in line, think safety and savings when selecting a vehicle for your teen. Typically, an older car will cost less to insure than a new one, and a vehicle with higher safety ratings could result in a less expensive policy.
With fewer hours behind the wheel, teens may be prone to more accidents. So, give your teen plenty of supervised time behind the wheel in the car that will serve as the primary mode of transportation.
Ask about insurance discounts for teenage drivers
Ask the insurance agent for a teen driver discount based on your teen’s good grades. Most policies require students to maintain at least a B average or better to qualify. If there's a discount, it will likely vary depending on the insurance company. While you’re at it, ask the insurance company about other available discounts for successful completion of a teen driver safety class or signing a safe driver contract.
Let the insurer track driving
Some insurance carriers have rolled out programs using telematics. These small electronic devices attach to the car and allow the insurer to track your teen’s driving habits for a defined period of time. The device collects data on speed, braking, miles driven and time of day your teen is on the road. The insurer then uses the data to possibly offer policy savings.
Tell your insurer when your teen is off to college
Many college students can’t have a car on campus. Be sure to update your insurance company if this is the case, since some companies offer a distant driver discount. This reduces your insurance costs while your teen is away at school.
Shop around for an insurance provider
Take advantage of the competition between companies. Shop online or call around to compare at least three quotes. This will give you a good sample of what's available without becoming overwhelmed with options. It’s often cheaper to add your teen to your policy instead of getting a solo policy. Remember, though, cheap insurance doesn’t always mean good insurance. Don’t sacrifice coverage for price.
While you’re comparing provider options, look for comprehensive and affordable auto insurance for both experienced and newly licensed drivers. That could be a money-saving option, especially when you bundle your teen driver policy with your home and auto insurance.
TruStage® Auto and Home Insurance program is offered by TruStage Insurance Agency LLC and issued by leading insurance companies. Discounts are not available in all states and discounts vary by state. The insurance offered is not a deposit and is not federally insured. This coverage is not sold or guaranteed by your Credit Union.