Tips for Lowering Teen Auto Insurance Premiums

Any household with a teenaged driver recently added to the family’s auto insurance policy needs to find ways to lower the premium cost.  Having a teenaged driver is a mixed blessing.  No longer do parents have to chauffer their child all around town at all hours of the night, however, the parents probably don’t sleep any better knowing their teenager is out and about driving with a brand new driver’s license.

There are several rating factors that go into rating an automobile insurance policy; obvious things such as type of car, driving record, number of accidents/violations, limits, deductibles, garage location, business or pleasure use, number of miles driven each year and so on. In order to lower the cost of adding a teen to the policy, the policyholder must consider a few policy rating factors that aren’t quite so obvious.

Here are a few things to consider when looking to lower the cost of adding a teen to the family’s auto policy:

1. What type of driving example are the parents setting? Parents must realize that teens ‘do what you do, not listen to what you say.’ Parents who have developed poor driving habits such as talking on the cell phone while driving, driving too fast, tailgating, not wearing a seatbelt or even driving home after enjoying a few drinks with dinner must understand that they are setting an example. While these habits may not make an initial impact on the family’s auto insurance premium, there is a good chance they will a little down the road when Junior is caught with a DWI because he had 1 or 2 beers with friends and decided to drive home.
2. Pull out the report card. Auto insurance companies offer a discount to students with a grade B or above. The rationale is that good students translate into good drivers.
3. Allow the teen to drive. This one is real difficult for parents to do. Get in the car and allow the teenager to drive. Watch with a discerning eye, not a critical one. Once Junior relaxes, the parent can see if the teen is developing good or bad driving habits. Reassure Junior when he does things right and lovingly explain the preferred method of handing a situation when he does things incorrectly.
4. Take a family driver’s education class. Every driver can benefit from taking a driver’s education class. Insurance companies offer auto premium discounts for taking such classes. Make it a family event to help reinforce the importance of being a safe driver. Before signing up for the class, however, make sure it is one approved by the Department of Motor Vehicles.
5. Have a chat with the auto insurance agent. In today’s online society, most policyholders don’t speak to a real person until they have an auto accident. With automated telephone services and obtaining auto insurance quotes online, who talks to people anymore? Break the habit and talk to an insurance agent to see if she knows of auto insurance discounts the teen and/or the family may qualify for such as a discount for being a veteran or member of an association for which discounts are granted.

It is always a bit of a shock to watch the family’s automobile premium increase when a newly licensed teen is added to the policy.  However, implementing a few of the above recommendations may help to lessen the financial pain.