While young people are excited about getting their drivers’ licenses and obtaining the freedom they have so long craved, the cost of insuring new drivers may cause sticker shock for mom and dad. Fortunately, there are ways to ease the costs of teen and young adult car insurance by taking advantage of the many discounts offered by insurers.
Defensive Driving Discounts
Successfully completing a defensive driving course can reduce the costs of insurance by 5 to 10% for new drivers. In addition to reducing costs, if your child does incur a driving violation, taking such a course may remove points that would otherwise cause premiums to spike.
Distant Driver Discounts
College students may benefit from distant driver discounts. If your son or daughter is heading off to college and will not have access to a vehicle while on campus, you can save money via these discounts since your child is only driving when home on break or during the summer.
While criteria may vary according to the insurer, in most cases the student must attend a school at least 100 miles from home and be enrolled fulltime. This is not a discount for commuting students. Generally, eligible students are under age 23.
A similar option offered by some insurance companies is a deferred driver discount. The student is taken off the policy completely during the school year, and you must add them back on during the summer if they are at home. This alternative saves even more money, but keep in mind a student can’t come home for a short visit and drive the car.
University, Alumni, and Military Discounts
In keeping with the college student vein, check out whether the school your child attends offers a university or alumni discount. Members of certain sororities and fraternities, along with honor societies, may also qualify for auto insurance discounts.
Of course, many young people head into the military after high school rather than pursue a college education. Many insurance companies believe those who defend our country deserve special insurance discounts, so ask about eligibility. If your child is deployed, notify the insurance company. Rates should lower because the member of the armed forces is not currently driving a private vehicle.
Premiums Reflect Household Insurance Health
New Jersey insurance agent Kati Robinson notes that when adding a teen driver to a parents’ auto policy, it is important to remember the premium increase is a direct reflection of the household’s insurance health prior to the new driver becoming licensed. “For example, if the parents have had multiple tickets and accidents, their rate increase for adding a teen driver will be higher than that of a household with squeaky clean records,” she says.
Grades and Apps Discounts
Most insurance companies offer good student discounts for those with all As and Bs, and some offer downloadable apps that track driver activity including hard braking and cell phone use. “If the app reports positive findings, the household could receive a substantial discount for proverbial good behavior. Some insurers will offer discounts for online safe driving course completion, having multiple policies with the same company, or affinity discounts for certain occupations,” says Robinson.
While every parent wants the best insurance deal for their teen driver, it pays to shop around. To a certain extent, you will get what you pay for, and you don’t want to find your family in a situation where you are dealing with a less-than-reputable or financially unstable company should an accident occur. When investigating insurance options, make sure you are comparing apples to apples so that you are not sacrificing your current level of coverage for a lower price.