I’m lucky; I have a few years to think (worry) about my kids driving. However, I know soon enough, the time will come when they will want their own car, want to start driving themselves to school and head out on the road alone.
Besides being a source of great dread for parents, having a teenage driver can also have a serious impact on parents’ budgets. Of course, there is the obvious expense of buying that first car (hopefully a nice used one), but there are other significant expenses such as gas, maintenance, and, most of all, insurance.
Car insurance for teenagers is often a deal breaker in many families. I remember when I started driving, my mom’s premiums went up significantly when she added me to her policy. Not because I was a fast-driving, irresponsible 16-year-old, but because I was a 16-year-old boy, and statistically, I was more likely to have a major accident.
We offset some of the costs because my first car was not necessarily a sexy choice – it was a 1985 Buick Century with faded silver paint. But it had been my grandmother’s car, and she drove very little. It also had a big engine and drove like a muscle car.
Fortunately, there are a few ways to save on car insurance for teenagers.
Buy a safe, reliable car not for looks but for function.
So many teens expect to see a brand-new red sports car sitting in their driveway the morning they turn 16. For most families, that is simply not realistic. What teens should hope for is a safe, reliable way to get from point A to point B. Besides, those shiny red sports cars often cost the most to insure.
Consider raising deductibles to offset an increase in premiums.
There’s a big IF attached to this advice. Only increase deductibles IF you have an adequate emergency fund saved to easily cover the out-of-pocket expense of major repairs. If you are still paying off debt or have yet to save a fully-funded emergency fund, it’s probably better to keep the deductible low and continue working towards your financial goals.
Sign up for a safe-driving course.
Many insurers offer discounts to those who’ve successfully completed a safe-driving or defensive-driving course.
Keep your grades up.
Many insurers also offer discounts for students who achieve and maintain a high-grade point average.
Consider insuring your home, automobiles, and any other valuables with the same insurer.
Insurance companies can often cover your home, your auto, and any other type of insurance required. Consumers can usually leverage some type of “multi-line” discount for having more than one type of insurance with the same company.
Add teens to your roadside assistance program.
You will sleep better when kids head off to college or off on a long road trip for their senior getaway if you know they have a quality roadside insurance plan. I’m partial to Allstate’s plan because you don’t have to have Allstate insurance to sign up, and you only pay for it when you use it. You can also register up to 5 drivers on your account (perfect for families with teen drivers).