Auto Insurance for Teenagers – Ten Tips to Reduce the Cost
Let’s face it – auto insurance for teenagers and drivers under 25 is going to be more expensive than it is for older drivers. Insurance is all about risk, and insurance companies know that teenagers and students are a high risk group. Because they are inexperienced and sometimes careless, they tend to have more accidents and make more claims. You have to pay for the mistakes of others in your peer group! Typical prices are 2.5 to 3.5 times the base rate depending upon where you live and whether you are male or female. The average cost of auto insurance for teens could be around $290 per month for a 16 year old female, and more for a male.
But, there is good news – here are some things that you can do to make sure you do not pay too much.
About the car:
- Choose you car wisely – flashy cars are going to be much more expensive to insure and are also more likely to get stolen.
- Go for older cars with safety and security features because they are cheaper to insure.
About You:
- See if you can be added to your parents policy as a named driver – their premium will go up, but maybe not as much as if you get your own policy
- Ask for a discount if you are a good student – some companies give discounts if you are getting B grades or better.
- Take an approved drivers education course – it may cost to do it but you could get the money back in reduced insurance costs by up to 15%, and you also benefit from being a safer driver.
- Keep out of trouble on the road – no speeding, traffic violations, accidents or DUIs (Driving Under the Influence of alcohol or drugs). A good record will reduce your bill.
About the policy:
- Consider increasing your deductible amount if you can afford it – this is the amount you have to pay if you make a claim. If you can afford to increase it to say $1000 that can dramatically reduce your premium.
- Choose a comfortable level of protection against collision damage and theft so you can stay on the road if the worst happens. You can reduce your premium by not including them in your policy.
- As a last resort, you could take out only the legal minimum basic liability protection – but be aware that you and your vehicle would not be covered if you have an accident. Also, there will be a limit on the amount the insurance company will pay out if you cause an accident, so this could be very expensive in the long run.
- Get on-line quotes from at least five companies in your state – shopping around will ensure the best value, but make sure you compare like for like and not just the headline rates.
After buying your car, the next most expensive item is the auto insurance. For teens, this may be almost as much as the vehicle itself, so it pays to choose your policy wisely.
About the Author
David is now running AutoInsuranceFor.org where you can get great advice on getting a better deal on your next auto insurance renewal