Alyssa Lane
Teenage drivers are considered high-risk due to their lack of driving experience and increased likelihood of accidents, resulting in higher insurance premiums. The cost of insuring a teen can vary depending on factors such as age, driving record, vehicle type, and location. One way to reduce insurance costs for teens is to add them to an existing policy, typically resulting in lower rates. Additionally, insurance companies offer various discounts, including good student discounts, which incentivize teens to maintain good grades and promote safe driving habits. These discounts can help offset the generally high cost of insuring teenage drivers.
| Characteristics | Values |
|---|---|
| Average annual cost of car insurance for a teenage driver | $3,775 |
| Average monthly cost of car insurance for a teenage driver | $315 |
| Average annual rate for adding a teenager to auto insurance policy | $4,050 for a 16-year-old, $3,740 for a 17-year-old, $3,478 for an 18-year-old, and $3,105 for a 19-year-old |
| Average monthly cost for adding a teen male | $2,622 a year |
| Average monthly cost for adding a teen female | $2,473 a year |
| Average annual full coverage premium for a male teen | $5,949 |
| Average annual full coverage premium for a female teen | $5,540 |
| Average monthly cost for a 16-year-old male on a parent's policy | $350 |
| Average monthly cost for a 16-year-old male on his own policy | $628 |
| Average monthly cost for a 16-year-old female on a parent's policy | $325 |
| Average monthly cost for a 16-year-old female on her own policy | $563 |
| Average cost for adding a teen between the ages of 16 and 19 to a policy | $299 per month |
| Average cost of insuring a teen (age 16-19) on a teen policy | $468 per month |
| Average car insurance premium for an 18-year-old female | $413 per month |
| Average car insurance premium for an 18-year-old male | $462 per month |
| Good student discount | 5% to 25% |
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What You'll Learn
Discounts for good grades
Teenage drivers are considered high-risk due to their lack of driving experience and higher likelihood of accidents. As a result, insurance rates for teens are generally higher. However, insurance companies often offer discounts to help offset the cost of insuring a new driver. One such discount is the good student discount, which rewards teens who maintain good grades with lower insurance rates.
The good student discount is based on the correlation between academic performance and responsible behaviour. Unmarried, full-time students who can maintain a certain letter grade or grade point average, often a "B" average or better, may qualify for this discount. The savings amount and eligibility criteria vary by company, with some companies offering an average discount of 8%-20% for good grades. For example, Progressive offers a 5% discount in most states for good grades, while State Farm offers savings of up to 25% for students with good grades.
To qualify for the good student discount, parents may need to provide their teen's most recent report card as proof of their academic performance. Homeschooled students may also qualify by submitting evidence of their performance on national standardized tests. It is important to note that the availability of this discount may vary by state, and parents should contact their insurance company to determine the specific requirements and savings offered.
In addition to the good student discount, there are other discounts that parents of teen drivers can take advantage of to reduce insurance costs. These include the distant student discount, driver training discounts, multi-car discounts, and discounts for vehicles with additional safety features. By combining these discounts with a good student discount, parents can significantly reduce the cost of insuring their teenage drivers.
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Safe driving courses
Teenage drivers tend to have higher insurance rates due to their lack of driving experience and increased risk of accidents. However, insurance companies often offer discounts for teenagers who have completed safe driving courses, which can help to reduce the cost of insurance. These courses can also help teenagers develop safe driving habits and become more responsible drivers.
Another option for safe driving courses is the B.R.A.K.E.S. Teen Pro-Active Driving School, a free defensive driving program for teenagers ages 15-19 (16-20 in NC) with a learner's permit or driver's license and at least 30 hours of driving experience. This course equips teenagers with the skills to handle various driving scenarios and promotes a proactive approach to safe driving.
In addition to these structured programs, some insurance companies offer their own safe driving initiatives. For instance, GEICO's DriveEasy program monitors safe driving habits through their mobile app and offers discounts on car insurance premiums for teenagers who demonstrate responsible driving behaviours. Similarly, Progressive's Snapshot® program uses a mobile app to track driving habits and provides discounts for good drivers.
By enrolling in safe driving courses and taking advantage of insurance company initiatives, teenage drivers can not only improve their driving skills and safety but also benefit from potential insurance discounts. These programs promote responsible driving habits and help mitigate the higher insurance costs typically associated with teenage drivers.
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Vehicles with safety features
The cost of insuring a teenage driver can be high, with rates tending to be more expensive for teens than for older drivers. This is due to a variety of factors, including their lack of driving experience, their tendency to take risks, and the fact that they are more likely to be involved in accidents.
One way to mitigate these costs is to add a teenage driver to an existing policy, which is usually more affordable than taking out a separate policy for them. Many insurers offer discounts for teens, with some offering lower rates for students with good grades.
Another way to reduce insurance costs for teens is to choose a vehicle with safety features. Insurance companies take into account the make, model, age, safety features, and repair costs of a vehicle when determining insurance premiums. Cars with high market value, powerful engines, or those considered luxury vehicles tend to have higher insurance rates for teens. Conversely, vehicles with good safety ratings, reliable models, and those equipped with advanced safety features like anti-lock brakes, airbags, and electronic stability control tend to be cheaper to insure. The Mazda 3 and Toyota Camry, for example, are said to have the cheapest insurance prices for teenagers.
The Insurance Institute for Highway Safety (IIHS) and Consumer Reports (CR) have compiled lists of recommended vehicles for teens, including both new and used options. These vehicles have been rated highly for safety, with good scores for braking, emergency and routine handling, and usability. When purchasing a used vehicle, it is important to check for recalls and notify the manufacturer of your purchase to receive future recall notices.
In addition to choosing a vehicle with safety features, parents of teen drivers can also assign cars with more safety features to their teens, which can help decrease insurance costs. By considering both the safety features of the vehicle and the insurance costs, parents can make informed decisions that balance their teen's safety with financial considerations.
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Age, driving record, vehicle type
Age
The cost of car insurance for teenagers is generally higher due to their lack of driving experience and increased risk of accidents. According to CarInsurance.com, adding a teen driver to a policy can increase rates by 70% to 150%. However, rates typically decrease as young drivers gain experience and demonstrate safe driving practices. For example, Progressive reports that rates drop by an average of 8% when a driver turns 19 and a further 6% at 21.
Driving Record
Maintaining a clean driving record and completing driving courses can help lower insurance premiums over time. Some insurance companies offer a good-driver discount, which typically requires the driver to have a clean license for three to five years. Driver training discounts are also offered by some providers, usually ranging from 5% to 15%.
Vehicle Type
The type of vehicle a teenage driver uses can impact insurance rates. Collision and comprehensive coverages for older cars, for example, may not be worth the added premium relative to the vehicle's actual cash value. Additionally, vehicles with safety features may be eligible for discounts from certain insurance providers.
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Adding teens to existing policies
Adding a teenage driver to an existing insurance policy is typically more affordable than purchasing a separate policy for them. This is because teens are considered high-risk drivers due to their lack of driving experience and higher likelihood of accidents.
The cost of adding a teen driver to an existing policy varies depending on several factors, including the teen's age, gender, driving experience, location, and vehicle type. According to CarInsurance.com, the average annual rate for adding a teen driver to a policy is $4,050 for a 16-year-old, $3,740 for a 17-year-old, $3,478 for an 18-year-old, and $3,105 for a 19-year-old. The cost of adding a male teen is generally higher than that of adding a female teen, with the exception of New York, where male teens are charged less.
It's important to note that some insurance companies offer discounts to help offset the cost of insuring a new driver. These discounts may be available for good grades, safe driving courses, or vehicles with additional safety features. For example, Progressive offers a 5% discount for students with a B average or better, while State Farm offers savings of up to 25% for good grades. Additionally, parents can consider assigning cars with more safety features to their teens, which can help decrease insurance costs.
When adding a teen driver to an existing policy, it's recommended to involve them in the process and educate them about car insurance. This empowers them to make informed choices and develop good driving habits that can lead to lower insurance costs in the future.
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Frequently asked questions
Yes, some insurance companies offer discounts for students with good grades. These good student discounts are available for unmarried, full-time students who maintain a certain letter grade or grade point average (usually a "B" average or above).
The average cost of adding a teen driver to your policy is $299 per month, or $3,594 annually. The cost of insuring a teen with their own policy is $468 per month.
Teenagers are considered high-risk drivers due to their lack of driving experience and their likelihood of being involved in accidents.
Aside from good student discounts, insurance companies offer savings for completing driver training programs, choosing a car with high safety ratings, and comparing quotes from different companies.
According to Bankrate's research, Auto-Owners, Geico, Nationwide, Progressive, and State Farm are some of the best insurance companies for teens.
