It is the natural progress that children are going to drive one day. Yet parents appear to be caught by surprise and unprepared when that happens. It is an expensive business to be paying for teenage car insurance coverage. So, it deserves some attention and care. It is best to go through the options, advantages and disadvantages of each option, so that parents can make informed decisions and find affordable policies.
Adding Children to Car Insurance
This is probably the easiest solutions that answer many questions at once. Since there is a car and an insurance policy in existence adding the new driver onto the policy and letting him/her drive the car would be a quick solution to say the least. Even you buy a new automobile for the youngster or for his/her use, it can be added onto the parents’ policy as a second vehicle or as part of a multicar policy. You need to be careful when you insure a vehicle that will be driven mainly by a teenage driver. Insurer needs to know this fact so that they can charge appropriate rates. Otherwise, they would unknowingly be offering cheaper auto insurance for teenagers that could be considered as deliberate misleading.
However, the question of would it be a good idea should be discussed in light of your circumstances.
· Use Parents’ Low Auto Insurance Rates: Insuring a young driver almost always attracts high rates. However, this can be off-set by parents’ good driving history and experience. Savings you get will keep the costs down. It is safe to say that adding a teenager to parents’ policy is generally the cheapest option.
· Youngsters Get Protected Better: Mature and established drivers usually keep much larger coverage compared to teenagers. So, children enjoy the comprehensive coverage parents have when they are included in the policy.
· Use of Multi-Car Discounts: Adding your teenager’s auto on your policy can qualify you for further multicar discounts that make this option even more economical.
· Risking Parents’ Policy Perks: Teenage drivers are over 3 times more likely to have accidents than drivers over the age of 20. They may also have traffic moving violation tickets in the early years as well. When they have accidents it will go against parents’ policy and the no claim bonuses will be lost. This will affect everybody under the policy as no claim discounts will be lost.
· Legal Liability: Technically, it is parents’ policy and there is a chance that third parties will be able to sue the policyholder (the parents) for damages caused by the teen driver. Usually, this course of action would be preferred by most lawyers since parents are more likely to have assets to go after. So, it is extra important to have large liability coverage if you are considering adding children to auto insurance.
· Increased Premiums: The premiums would increase quite a bit because of the addition of young driver. However, this may not be seen as disadvantage if the parents would pay for whichever policy is chosen. It would be a lot more expensive to buy a separate policy.
Buying a Separate Teen Auto Insurance Policy
Most parents would see this option as plan B. In most cases, it is a lot cheaper to include your children under your policy when they get their driver license. This is also faster and easier option for practical reasons. Most parents would want to use their good records to get cheap car insurance for teens.
However, there can be circumstances in which it is best to arrange a separate teen policy. One of them would be a terrible parents’ driving or claims history. Parents may be older and wiser but this doesn’t guarantee that they will have clean driving and claim history.
For example, a DUI in parents’ records can make it pointless or impossible to add a youngster on parents’ policy. Or parents may be about to be kicked out by their insurer due to too many accidents and it may not be a good time to add a teen driver.
Also, it may not be practical or possible to add a teenage driver if parents have sports cars in their policy. Most auto insurers would not be happy to insure a teenager with access to a sports car. Then, you would need to buy a separate policy for him/her.
How to Get Affordable Auto Insurance for Teens
A few tips on how to save money when insuring teenagers would complement this topic well. Yes, it is expensive to insure them but there are still ways to lower costs as long as you (or your teenager) are prepared to do what it takes. Here are some of the methods.
Purchase Safe Cars for Teen Drivers: Insurers may not be much comfortable with young drivers but they love safe automobiles. So, you would probably qualify for some discounts if you have one of those cars. You can check the safety ratings of cars before making a purchase. At least, you can avoid making a big mistake by buying a high risk car for a high risk driver.
Alternative Coverage for Cars Driven by Teens: This could work well if you bought or allocated an older automobile for your teen driver. It may be advantages not to insure their cars for Collision and Comprehensive Coverage if they are not much valuable. If you can handle the damages on your own to his/her automobile it may be acceptable to leave them out in terms of Collision and Comprehensive Coverage. Most multi-car policies would allow different level or types of coverage for each car in the package.
First of all, after the deductibles you may not get much from claims you make on older cars. Secondly, making a claim would make matters worse at next renewal. Some companies may ask an arm and a leg to insure you and your teenagers after a car crash that was one of the listed drivers’ fault.
Increase Deductibles: Increasing deductibles is a good alternative to dropping Collision and Comprehensive coverage. Instead of having no coverage, you can choose to contribute to claims a bit more out of the pocket by increasing deductibles and keep the coverage. Usually, this would help in getting cheap vehicle insurance for teenagers.
Look for Other Discounts: Depending on the state regulations and auto insurers, even teen drivers can qualify for further discounts. Taking safe driving courses is one way of getting around 10% discounts in most states and offered by most companies. Multi-car policy savings are already mentioned above. Teenagers in full time education and doing well in their courses may qualify for more economical automobile insurance for teens too.