Decrease Your Teen's Auto Insurance Rates

Having a teen driver in your household can be quite expensive, especially if you plan to add a teen to your current auto insurance policy. In fact, it is not uncommon for premium rates to increase anywhere from 50-100% after adding a teen to any given auto insurance policy. Auto insurance companies base premium rates on a number of different factors, but teen accident statistics and statistics related to teen driving behavior affect premium rates the most. 

Teen Accident Statistics

According to the National Highway Traffic Safety Administration (NHSTA), 16-year-olds have the highest crash rates among drivers of all ages. Motor vehicle crashes are also the number one cause of death among teenagers in America today. In addition to costing thousands of young lives, auto accidents involving 15-20 year old driver’s costs the U.S. more than $40 billion a year.

Teen Driving Behavior

It is estimated that more than 31% of teen drivers killed in 2006, were under the influence at the time of the accident. The NHTSA states that 25% had a blood alcohol level of .08 or higher. According to The Allstate Foundation, an independent charitable organization, teen drivers also:

Talk on cell phones while driving (56%)
Speed up at yellow lights (64%)
Speed to keep up with traffic (69%)
Admit to being distracted when other passengers are in the car (47%). In fact, according to the Insurance Institute of Highway Safety (IIHS) teen driver death rates increase with each additional passenger.

How to Decrease Teen Auto Insurance Rates

While the state of teen driving behavior and accident statistics may sound hopeless, it’s not. There are several things you can do as a parent and as a teen driver to avoid accidents and in turn, lower your premiums such as enrolling in a defensive driver or driver safety course, limiting the number of passengers in the car, and limiting nighttime driving. Other ways to lower your premiums on teen auto insurance include: getting good grades to qualify for good student discounts and opting for an economy car over a sports or luxury car.

•    Defensive driver or driver safety courses can be taken at an approved traffic school. You should check with your DMV before enrolling in any given course. Upon completion, your teen will receive a certificate. Most insurance companies offer discounts with a certificate.

•    Limiting the number of passengers in the car can decrease your teen’s chances of being involved in an accident by nearly 50%. Having accidents on your record will lead to higher premiums, having a clean driving record can help keep premiums low. In fact, many insurance companies will lower premiums each year as long as the teen maintains a spotless driving record.

•    More than 41% of all teen accidents occur between 9 p.m. and 6 p.m. According to American Automobile Association data, all but 11 states have taken notice by enacting nighttime driving laws for teens. These laws restrict teen drivers from operating a motor vehicle after a certain time as determined by each state. Even if your state does not have nighttime driving laws for teens, limiting your teen’s driving to daytime only will decrease your teen’s chances of being involved in a fatal accident.

•    Most insurance companies offer discounts for good grades. Maintaining a B average or better can lower insurance rates anywhere from 10-20%.

•    Sports cars and luxury cars cost more to insure due to the nature of sports cars and the cost of luxury cars. These types of vehicles cost more to insure whether you are a teen or a mature driver, so just be practical. Purchasing a sedan or a used car will be much easier on your wallet—in more ways than one.

Before you begin your search for Teen Auto Insurance be sure to have the following documents and information available to help the process run smoothly and to qualify for discounts:

Teen’s Driver’s License or Permit
Copy of Transcripts
Certificate of Completion (driver safety course, defensive driver course)
Copy of Car Title
Mileage

Good Luck!