Teenagers and Car Insurance – Is it Always More Expensive?

Parents with teens who are about to start driving may have already come to the realization that car insurance for teenagers can be very expensive. However, there may be hope for parents with teen drivers. Read the following information to find out why car insurance for teenagers is more expensive. In addition, we will discuss some top tips for getting lower rates for your teen, as well.

Teen Drivers: High-Risk

Among other factors, insurance companies assess a driver’s risk of being involved in a collision in order to determine their premium rate.

Statistics have shown that teen drivers are more, at risk of being involved in a serious or even fatal car accident. In fact, some studies have shown that teens can be as much as, four times more likely than adults to be involved in a fatal collision. Therefore, insurance companies place teenagers in a high-risk category, which means higher rates.

Why are Teenagers Considered High-Risk?

While it may not be true in all cases, overall, teenagers have a reputation for getting distracted (talking to friends, playing with the radio and texting), driving recklessly (speeding or driving under the influence of alcohol, etc.) and not exercising proper safety precautions when driving — often due to inexperience. Therefore, in an effort to protect their financial investment, insurance companies set the rates higher for teen drivers.

Tips for Getting Cheaper Rates for Teenage Drivers

Everyone can use a few tips for saving money on their insurance, especially parents with teen drivers. Below, are a few suggestions for how to get cheaper rates for your teenage driver.

  • Encourage Good Grades — Many insurance companies offer a Good Student discount to students who receive a 3.0 GPA or higher. Often, this discount can be up to ten percent off the premium, which adds up for parents who are trying to cut corners.
  • Enroll your Teen in Driver’s Education — Insurance companies appreciate driver’s education because it provides teens with the information and instruction they need to be safe drivers. To express their appreciation, most insurance providers offer a discount to teens that complete a driver’s education course.
  • Buy a Cheaper/Older Car — Insurance rates are based, in part, on the vehicle a person drives. Fast sports cars have extremely high insurance rates attached to them. In addition, newer cars are more expensive to insure, as well. Therefore, in order to get cheaper rates — you will want to avoid getting your teen a car that is brand new, fast or considered a luxury car.
  • Teach Safe Driving  — Car insurance rates are based on many different factors, but one of the most critical aspects related to insurance premiums is an individual’s driving record. By practicing safe driving and keeping, their driving record spotless (or as clean, as possible) teens will avoid skyrocketing rates.

While it is inevitable for teenage car insurance to be expensive — these tips are a great way to cut costs and save a little dough for your teenager’s next big expense…college.

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