5 Ways Your Teen Can Help You Spend Less On Auto Insurance
So your teenager just passed their driving license exam. Now they will be cruising in their own car and you won’t have to bother with driving to school anymore. There’s relief on your part but also a nagging feeling of worry for their safety. You’ve done all you could to educate them about safe driving practices. What else can you do? Purchasing a separate auto insurance policy for them may be your next best bet.
Unfortunately, auto insurance for teens doesn’t come cheap. Insurance providers generally charge a higher premium for teens because of their lack of driving experience. According to statistics, automobile accidents are the top cause of death among American teenagers ranging from 15 to 19 years old. Aside from age, other factors such as geography can affect policy rates as it varies from one state to another. Gender is also a significant factor with males generally having a higher rate than females.
The good news is that while car insurance for teens can be expensive, there are ways to save money on your teenager’s auto insurance costs.
1. Earn Good Grades
Now your teen has another reason to study hard. Insurance companies typically give discounts of up to 35 percent to students who have a minimum grade of B average. This lower rate applies to students below the age of 25. When you purchase car insurance, make sure to provide proof of their school performance by showing a copy of a report card or a form signed by a school administrator.
Teens who are homeschooled may also get a lower auto insurance rate. Your teen may show results from one of the following standardized tests: SAT, ACT or PSAT and must rank in the top 20 percent of that exam’s national performance to qualify.
2. Enroll in a Safe-Driving Course
Teen drivers are seen to be more prone to road accidents than their older and more experienced counterparts. Because of that, insurance companies are promoting defensive driving courses to teach teenagers how to drive safely and follow road rules.
Allstate offers a discount for teens who choose to enroll in a driver’s education course called teenSMART. It’s a computer-based safety program that lets teen drivers experience driving simulations to enhance their driving skills. Once a teen completes the course, he or she will receive a coupon code that will reduce the purchase cost of the insurance policy.
State Farm, on the other hand, has a safety driving course called Steer Clear. Finishing the course can provide up to 15 percent net discount to families on their premiums.
3. Drive an Older Car
There are several reasons why you should let your teen drive an older car than buy them a brand-new one. In general, newer cars are more expensive to insure than older models. Teens also lack the experience of being on the road and are more susceptible to road accidents. Letting them drive an old, seasoned vehicle would help reduce your car insurance premium especially if the car has built-in safety features.
4. Move Out
Most teenagers leave home at 18. One of the main reasons that teenagers leave home is to attend college. If your child’s college is at least 100 miles away from home and won’t take the car with them, you can inquire for a student-away-at-school discount for your premium.
Liberty Mutual, Amica, Progressive, Erie Insurance and Family Insurance are some of the insurance companies that provide discounts when your teen driver is away from home.
5. Drive with Telematics
New technology now allows parents the opportunity to monitor their child’s activity behind the wheel. Telematics monitors a driver’s habits and can produce collated data which the owner can access online. It can gather data such as the number of hours the car is on the road, the miles it has covered, the speed the car is driven and how frequently hard brakes are used.
When teens meet the telematics’ standards, they can qualify for a discount of 15 to 30 percent depending on the insurance provider.
Allstate has its DriveWise program in which a telematics-enabled device is installed below a car’s dashboard. Those who meet the benchmark imposed by the provider enjoy a 30 percent discount. It’s available in more than 20 states and is optional.
Safeco Insurance, on the other hand, offers a 15 percent discount to teens with a telematics device in their car. If results show a satisfactory driving performance, a discount granted and applicable until they turn 20.