Given driving lessons to your teenager recently? Then you understand why car insurance for new drivers is expensive. New drivers are some of the riskiest drivers on the road from the point of view of the car insurance company. And premiums for new drivers reflect that. But there are some things you can do to keep premiums to a manageable level:
Add your child to your policy. In nearly every case, it is more economical to add a child to your existing policy than it is to take out a separate policy for your child. Contact your insurance company or agent directly and tell them you want to add a driver. Compare prices if you like, but chances are overwhelming that your best deal is going to come by including your whole family on one policy.
Keep the grades up. Insurance companies keep careful statistics, and over the years, they’ve found that the kids with the best grades also make the best drivers. The correlation is so strong that many companies will discount insurance premiums for kids with good grades. One technique: Tell your youngster you will pay the rate for a good student. If grades slip, and premiums go up, it’s up to your child to earn the difference. Otherwise: No wheels.
Multi-line discounts. Many insurance companies will discount premiums if you hold multiple policies with the same company. If you already have your homeowners insurance, flood insurance or life insurance with a company, consider getting them to quote your auto insurance too.
Use an older car – and skip collision coverage. A young driver can work off the price of an inexpensive car. The real concern is liability coverage. To save premium dollars, skip the collision coverage, but carry plenty of liability insurance.
Raise a good driver. An accident, or one or two moving violations early on, can cause premiums to skyrocket, or even prompt a cancellation altogether. And forget about car insurance if your teen gets a DUI conviction. Level with your kids about the importance of safe, responsible driving. And show them how much it will affect their pocketbook if their rates go up. A $150 per month rate increase equals a lot of hours flipping burgers!