Saving on Young Driver Car Insurance

Posted by Jose Lopez on May 17, 2010 | No Comments »

Whether you or your teenager is paying for their car insurance, it helps to save some cash month-to-month. Here are some tips to get you started.

1.) Online driving courses: There are plenty of these on the web, some for only 25 bucks. Insurance companies will lower your overall rate by 10 or even 20%. The course may take a while, but the monthly cash saved is worth the time.

2.) Drive safely: If you’re the one at fault in an accident, it’s standard practice for an insurance company to raise your premium by a whopping 40% of their base rate. So stay away from texting or talking on the phone. (Studies have shown that you’re 23 times more likely to crash while texting.) Keep teens and cell phones apart while in the car.

3.) Pay it all off at once: Get rid of that premium all at the same time instead of paying for monthly processing fees. Some providers will even knock off another $25 or $50 just for paying early.

4.) Make & Model: Some teenagers might like big cars with lots of bling, but since statistics show that kids with fancy cars get into more accidents, their insurance is higher. Have your teen drive a low-profile car and you’ll escape higher rates.

5.) Good credit: It’s simple- If you keep good credit, you’ll have a lower insurance bill. Work on it now and avoid bad credit habits in the future.

6.) Don’t buy what you don’t need: If it’s unlikely your car will be totaled in a 20-car pileup on a major highway, just don’t buy it. Carefully consider every option; make a cost-benefit analysis of what you think you’ll need on the road.

7.) Trust the driver: If someone else besides your teen gets into a wreck, guess whose insurance gets a kick? Yours. Don’t just let anyone drive the car. Make sure your teenager knows the risks involved when he or she lets another person take the wheel.

8.) Just because a kid reaches the driving age doesn’t mean they have to be added to your insurance plan. Don’t do it ’til it’s necessary.

9.) Discounts: Many companies offer a smart student discount (e.g., a 10% discount if a student keeps at least a 3.0 GPA). Staying loyal to one company can earn continual discounts annually. If your kid is at college, at least 100 miles away from home, let the provider know- you’ll see a lowered monthly bill, particularly if they don’t have a car on campus.

10.) Consider a higher deductible: Essentially, they’ll pay for the big stuff if you pay for the smaller stuff.

11.) One last tip for parents: Making your teen pay for their own insurance is a great incentive to get a good old-fashioned J.O.B. Independence is a top priority of theirs right now, so make them earn it: If they get a job, they get insurance; if they get insurance, they can drive. Makes sense, doesn’t it?

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Tags: Car Insurance, Insurance

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