posted
by Insurance Assistant
Turning 16 is one of the most exciting times in a young person’s life. It means he or she can get their DRIVER’S LICENSE.
Unfortunately, it can also nearly drive (pun intended) their parents into near bankruptcy. Adding a teenager, especially boys, to a family auto insurance policy can nearly triple the amount of money you currently pay.
A typical family adding said teen to their auto insurance policy can see their rates skyrocket from around $377 every six months, to $1,280, according to State Farm. Of course, that is auto insurance without any discounts.
Why is auto insurance so expensive for teenagers?
According to the Insurance Institute for Highway Safety, 16-year-old drivers are more than three times as likely to be involved a crash as their 20- to 24-year-old counterparts are. Plus, automobile accidents are the leading killers of people from 15 to 20 years of age.
What can be done to lower auto insurance for teens?
Some companies, State Farm among them, do offer several discounts for auto insurance. One of them is good grades. If your teen driver maintains a 3.00 grade point average (considered a B), that $1,280 auto insurance policy will drop to $1,041 every six months. Smarter students are considered to be less of a safety risk for auto insurance purposes.
There is another discount that State Farm offers on auto insurance called their Steer Clear program, which, combined with good grades, will reduce the premium on that auto insurance policy down to $911.90, still not a bargain but more than $300 below the open rate.
If a teenager signs up for the Steer Clear program, State Farm gives them a video to watch and a log book that helps them become more responsible and aware of their driving surrounds.
While some auto insurance providers may give anywhere from 5 to 15 percent discounts for driver’s education classes, State Farm discontinued the practice some 15 years ago.
There are a few other ways of keeping auto insurance costs down for the newly licensed driver.
Of course, shopping around is at the top of the list for all your needs, not just auto insurance. Be careful to make sure what kind of policy you are getting and how reliable the insurer is before laying out money for auto insurance policies.
Some auto insurance companies will allow families to assign their teen drivers to the oldest car in the family to lower costs. If you can afford it, increasing the deductibles on your cars can also lower those auto insurance rates. New cars cost more to insure than older ones, naturally.
Be sure to inquire of your auto insurance carrier what other discounts that are available. You may be able to save on the policy.