For all of those parents out there who are about to have a young driver in your household, here are a few tips and tricks to keep your insurance premium from sky rocketing through the roof.
1.) Always make certain that your young driver has taken Driver’s Education or another type of driver’s safety course. This can save you up to 20% or more. (Some states require this in order to issue a license to those under 18.)
2.) Never purchase a young driver a high performance vehicle. Contact your insurance company and have them run a rate if you are not sure if the vehicle is considered high performance. There are several vehicles (even certain Cadillacs) that are considered "high performance" that you would never think of putting in that category. A high performance vehicle purchased for a male young driver and must carry full coverage can run anywhere from $1500 to $3000 a year or even more. For a female the premium could be anywhere from $1200 up to or exceeding $2500.
3.) Opt for a higher deductible on collision coverage. Going from a $100 deductible to a $500 deductible could save you around $300 a year on the insurance premium.
4.) Choose the lowest liability limits which you can carry on a policy. Each state has a different limit usually ranging from $25,000/$50,000 to $100,000/$300,000. Choosing the lowest limits can actually save you around $150 per year on a policy for a young driver.
5.) Be aware that most companies will put a young driver charge on the most expensive vehicle no matter which one they will be driving. So it is in your best interest to let the young driver have a less expensive vehicle (and here trucks have even lower ratings than cars), put it in their name, and put it on a policy just for them. You could be looking at substantial savings by doing this.
6.) Always make certain to ask your insurance companies if they will give discounts to young drivers. Some companies will give them safe driver, multi-car, and other discounts. Some companies will give a substantial discount if the young driver promises (pledges) to use their seat belt at all times and not let any other teenagers ride with them until they have had their license for at least a year. Some companies have good-student discounts.
7.) Ask your insurance company if they have first-accident forgiveness. If they do not, you could be looking at your premium doubling or more if your young driver is in an accident. If the insurance company goes as far as canceling the policy on your young driver, you could be looking at the premium being tripled or more if you have to go to a sub-standard company.
Therefore, young drivers are going to cost on the insurance no matter what you do. However, here are a few tips that could help you keep the insurance premium under control for a young driver.
