Insuring New Drivers: Permit Protection And Peace Of Mind

Getting car insurance for a new driver with a permit is relatively easy. In most cases, the new driver can be added to their parent's existing insurance policy. However, this will likely cause the premiums to increase, as new drivers are considered to be more prone to mishaps and, therefore, more of a risk. The amount by which the premiums increase will depend on the state and the driver's age and gender. It is also possible to get a separate insurance policy for the new driver, but this is usually more expensive.

Adding a new driver to an existing policy

Most insurance companies allow, and in some cases, require you to add another driver to your policy if they share your permanent residence or drive your insured cars regularly. This can be done by contacting your insurance company, either by phone or by logging into your account online. They will need the new driver's personal information, including their name, date of birth, driving history, license information, and, if necessary, their vehicle identification number (VIN) if you plan to share a policy covering both your vehicles.

It's worth noting that adding a new driver to your policy can provide financial protection and help build their insurance history, which can be beneficial when they eventually take out their own policy. Furthermore, it is usually more cost-effective to add a new driver to an existing policy than to take out a separate, individual policy for them, especially if they are young or inexperienced.

Purchasing a separate policy

If the new driver has their own vehicle, they can purchase their own car insurance policy. This is also the case if they are over the age of 18. However, if the driver is under 18, an adult would still have to co-sign on an individual policy.

When purchasing a separate policy, it is important to consider the state's minimum insurance requirements and the specific situation of the new driver. For example, liability coverage should be sufficient to cover assets in the event that the new driver is responsible for another driver's injuries or property damage. Additionally, comprehensive car insurance coverage and auto collision coverage may be beneficial since new drivers are more prone to mishaps.

The rates for permitted drivers will vary depending on several factors, including age, location, vehicle type, insurer, and coverage levels. For example, the average annual rates for 17-year-olds in 2023 were $5,064 for females and $5,750 for males in the US. It is recommended to speak with an insurance representative and read the policy contract to fully understand the coverages and requirements.

Understanding state insurance requirements

Firstly, it's important to recognize that each state sets its own minimum insurance requirements. These requirements are typically outlined by the state's Department of Motor Vehicles (DMV) or a similar regulatory body. For instance, in New York, the DMV dictates insurance requirements, including the need for New York State-issued automobile liability insurance to register a vehicle within the state. Therefore, it's essential to consult your state's DMV or relevant authority to understand the specific insurance mandates.

Secondly, most states require drivers with a learner's permit to have auto insurance. This insurance can be obtained through a parent's or guardian's existing policy, which is often the most cost-effective option. Adding a teen driver to an existing policy can result in higher premiums due to the increased risk associated with inexperienced drivers. However, it's still generally more affordable than a separate, individual policy. This option also allows the new driver to build an insurance history, which can be advantageous when they eventually need to purchase their own policy.

Thirdly, when insuring a new driver with a permit, it's essential to consider the specific restrictions and requirements of a learner's permit. These restrictions may include curfews, limitations on the number of passengers, or stricter penalties for violations. Graduated Driver Licensing (GDL) laws, implemented in several states, impose such restrictions on drivers under a certain age or in the permit phase. Understanding these limitations is crucial to ensure the new driver complies with the law during their learning period.

Additionally, when reviewing state insurance requirements, it's worth noting that liability coverage limits should be carefully considered. This coverage is designed to protect the permit driver and their assets in the event they are responsible for another driver's injuries or property damage. Given the higher risk associated with new drivers, it may be prudent to opt for comprehensive car insurance coverage and auto collision coverage for added protection.

Lastly, while most states mandate auto insurance for drivers with a learner's permit, there are exceptions. For example, New Hampshire does not require drivers to carry auto insurance but instead demands that they demonstrate financial responsibility in the event of injuries or damages resulting from a car accident. Understanding the specific requirements of your state is, therefore, essential to ensure compliance with insurance laws.

Discounts and premium increases

Adding a new driver to your insurance policy can be expensive, but there are a number of ways to save money. Firstly, it is usually more affordable to add a new driver to your existing insurance policy than to take out a separate, individual policy for them. This is true for both parents and their teenage children, as well as for couples where one partner is a new driver.

Secondly, if you have more than one car on your policy, you’ll probably get a discount. This is known as a multi-car discount and is offered by many insurers. Similarly, you may get a discount for having other policies with the same company, such as a home or renters policy.

Thirdly, if you have a good driving record, you can probably get a discount. Insurers see good drivers as less of a risk, so if you haven’t filed an insurance claim and have a good driving record, be sure to let your insurer know. In addition, if you have anti-theft devices on your car, this reduces the risk of it being stolen, which is good for both you and your insurance company. Therefore, if you have anti-theft devices or add them after you buy a policy, tell your company.

Fourthly, if you have high school or college students who get good grades, let your company know, as many insurers offer discounts for good students. This is known as a "good student discount".

Finally, taking a driver training course can help you get a discount on your insurance. This is because it encourages young drivers to sharpen their skills, making them safer on the road.

Comprehensive and collision coverage

Adding a new driver to your insurance policy can be a daunting task, especially if they are still learning to drive and only have a permit. While it is mandatory in most states to have liability insurance, comprehensive and collision coverage are optional but valuable additions to your insurance policy.

Comprehensive insurance, on the other hand, covers a whole host of common problems that don't always involve your driving. It pays to repair or replace your car if it is stolen or damaged by issues such as a flood, fire, striking an animal, falling objects, or vandalism. The average cost of comprehensive coverage is a little over $134 per year, making it a cost-effective option considering the range of damages it covers.

If you have a car loan or lease, both collision and comprehensive insurance are generally required. They are also necessary if you want to protect your assets in case the permit driver is responsible for another driver's injuries or property damage. While these coverages may increase your insurance premiums, they can provide valuable peace of mind and financial protection in the event of an accident or mishap.

It is worth noting that separate coverage for a permit holder is typically more expensive, but in some cases, it might be unavoidable. You can explore options with your insurance provider to determine the best way to insure a new driver with a permit, including adding them to your existing policy or purchasing a separate policy for them.

Frequently asked questions