I have spoken to many families with a new driver, especially a teenage driver, and they are shocked by the increase in their car insurance bill. Many of these families had two responsible drivers with long histories of avoiding accidents, and so they enjoyed good rates. However, when they called up their old company to inquire about rates, many families found that their rates would double, or even triple, when they added their son or daughter to a policy.
Teenagers are one of the most expensive class of drivers to insurance. This is because the young person does not have their own history of good driving, and so insurance companies look at the history of the class of drivers as a whole. What they find is that teenagers, especially boys, make more claims then other age classes of drivers. If the company takes the increased risk of insuring these inexperienced, and possibly reckless, young people, they will certainly charge for that risk!
However, you can take a few steps to minimize the increased cross. First, do not assume that your old company will be the cheapest company. You should take the time to shop around. Another insurer may offer discounts for other things your family does to reduce claims, or they may be seeking business in your area, and so you may find some breaks. Some factors, like credit rating or the zip code you live in, may be cheaper with another company, and the fact that you have done business with one insurer for a long time will usually not affect that at all.
One of the most common breaks, though, is a multiple policy discount. If you move all of your family business, including home insurance, you will probably find substantial savings. I found a ten percent savings on my homeowners insurance by moving both my car and home policy to one place. It also allowed me to enter a better rating class, with the auto policy.
If your young driver is a student with good grades, be sure to mention that. B students, as a class, seem to make less claims then C students. Companies also offer discounts for drivers who take approved driver’s education or driver safety classes. This may chip another ten to twenty percent off of the car policy. And the same discounts that apply to all customers, would also apply to a teenager. Safer cars, safety features, and anti-theft devices can earn a substantial break, and sometimes the investment in these features, will payoff in a very short time with a cheaper premium. A simple alarm system, which only cost a couple of hundred dollars when I bought my last car, paid off in another ten percent savings. Plus, I have the security of knowing that my car, and maybe even myself, will be better protected.
A few minutes spent comparing car insurance premiums, and possible savings on other insurance, can earn you discounts of thirty to fifty percent. In my case, a little shopping saved me $50 a month, or $600 a year. It was certainly worth taking a little time to look into. If your family has more then one young driver, then you could save a lot more!
Tags: car insurance, insurance cars, cars insurance, carinsurance
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