It may seem to be impossible to find cheap auto insurance rates when a new teen driver is involved. However, affordable auto insurance can be possible when certain factors are involved. The following information will help guide parents and teens to get the best deal on auto insurance rates and help with this very important decision.
How Parents Can Shop For Auto Insurance For Teens
Parents with new teenage drivers need to be aware that if they already are getting great rates with an insurance company, it is going to give them cheap auto rates if they just add their teen to their existing auto insurance policy.
- Typically the parents will be getting cheap auto rates because of the many years driving experience and a good driving history.
- Parents usually have established a long-term relationship with the same auto insurance company, which provides additional discounts to all drivers.
- Parents should add a teen driver as soon as they get their license. This will set them up to have cheap auto rates in the future when they do eventually buy their own car and get their own car insurance.
Parents who buy a car with a loan for their teen driver will expect to pay higher auto rates.
- New, young drivers are at a higher risk for causing a collision. Collision insurance will pay to fix the teen’s car as well as any other property damage they cause.
- The loan company will require the vehicle to have comprehensive and collision coverage, which will cause auto rates to jump much higher.
Parents who buy a car outright for their teen driver will find cheap auto insurance rates because the only requirement for coverage would be for liability.
- If there is liability only coverage, it just pays out for other’s property damage. Therefore, the insurance company will be paying less in claims.
- Less risk for the insurance company means lower auto insurance rates for parents.
Teens Shopping for Their Own Cheap Car Insurance
If a teen driver does not have the option to be added on a family member’s policy, there are two options they can consider.
A non-owner policy will provide cheap car insurance rates and will insure the driver on any vehicle.
- This will begin to establish the teen’s car insurance history. Once they have established six months or more of continuous coverage, shopping for cheap car insurance on an actual vehicle will be much easier.
- The important point to remember is to never be without some form of liability insurance, even for a day. This will set any age driver up for cheap car insurance rates in the near future.
If the teen owns a car and does not have the option to be added to a family member’s policy, they will have to buy regular car insurance. The car insurance is going to be more expensive, and there is no way around that, but there are factors that will reduce insurance rates.
- One big factor is to have a car that is paid for and purchase liability only insurance. Again, liability only is less risk for the auto insurance company and this will translate into cheap car insurance rates.
- A second factor is to check the lower liability limits. However, don’t just assume the lowest state limits are best. Many times, the next tier of coverage will only be a few dollars more, and it would benefit a teen driver in the long run to start off with higher limits. The payoff will be in the reduced rates after continuous insurance history is obtained. Most companies will offer discounts when coming to them with higher than state minimum coverage.
- Ask about all eligible discounts. Good students and safe drivers receive added discounts. Memberships with organizations may provide discounts as well.
Insuring a new, young driver can make it difficult to find cheap auto insurance. However, following these guidelines will provide the best options for getting the best deal for car insurance and help the driver establish insurance history. Once continuous insurance coverage is maintained, rates will begin to come down.