In the United States, 4 million new teenage drivers hit the road each year. They all require auto insurance. So, exactly how much insurance do these new drivers need? And how can you get the lowest rate possible for them?
The thought of having your son or daughter behind the wheel of a car can be scary. This fear is totally natural, and to be honest, you should be a little scared. New drivers, regardless of how long they’ve been practicing, just don’t have the real world experience to drive a vehicle safely. Heck, most experienced drivers don’t drive as safely as they should. This is why it is so important to make sure you insure your new driver as soon as they get a license. Not only are you protecting yourself from costs of repairing the damage to your car, others’ cars, and medical bills, but you are also insuring the safety of your child, should they get injured, or worse.
Minimum Insurance Requirements For New Drivers
Before receiving a driver’s license, while holding just a learning permit, it is not required by state law to carry auto insurance. However, as soon as your son or daughter can legally drive alone it is required.
The first step for those who are new to auto insurance is to look into your state’s minimum insurance laws to find out exactly what coverage levels you must maintain to prove that you are a financially responsible driver. Each state operates their auto insurance system differently, although the differences may be very slight between states. Generally you will need to have some form of Bodily Injury Liability and Property Damage Liability coverage; these two policies are required in nearly every state. Other states may mandate that drivers must have insurance that protects against accidents caused by uninsured drivers, or they may state that drivers must purchase insurance that provides coverage for personal injuries. Speak with a local auto insurance agent or search online to find out a bit more about your state’s minimum requirements.
Insurance For Inexperienced Drivers Is Expensive
An unfortunate truth of being a new auto insurance customer is that you are almost certainly going to pay more for your auto insurance than someone who has been driving for a few years. The reason for this is simple – the auto insurance companies have no idea how much of a risk you present, and therefore don’t know how much you may cost in future claims and payouts should you cause a number of accidents. Be prepared for the fact that you will most likely pay a few hundred dollars a year more for your auto insurance than someone who is more established, and you won’t be disappointed when you find out what your new auto insurance costs.
Individuals who are on a budget may want to consider purchasing a low-cost vehicle for the first few years that they have car insurance. Until the major discounts start kicking in a few years into your relationship with your new auto insurance company, insurance costs will remain relatively high. One of the ways to keep these costs low is to purchase an inexpensive car to drive while you build up your safe driving and other discounts with your auto insurance company. Insuring an expensive luxury or sports car is of course going to be more costly than insuring a cheaper vehicle simply because it costs less to repair the cheaper car in the event of an accident. Go with a cheap car for the first few years, and you’ll save a ton on your auto insurance.
Even if you are a relatively new driver, you may still qualify for discounts on your car insurance thanks to the many different discount programs that insurance companies use to attract new business. When you’re researching your auto insurance options, look around for discounts that may apply to your situation, such as a student discount for those attending college or a graduation discount for students who have just left high school and are getting car insurance for the first time. Even if you only qualify for one or two discount programs, you may end up saving over $100 a year on your car insurance so it’s definitely worth looking in to.
Five Tips For Insuring A New Driver
As stated above, due to the high risk of accidents with new drivers, auto insurance companies charge significantly higher rates to insure these individuals in comparison to older, more experienced drivers. With that being said, there is a lot you can do to cut costs, while still maintaining the legal level of coverage. Below are the most effective ways to do so.
1) Insure New Drivers Under Their Parents’ Policy
This is a fast and easy way to lower the costs of insuring your son or daughter. Auto insurance companies will offer a discount for insuring multiple people and vehicles under the same plan. To get started, ask your insurance agent for guidance on adding new drivers to an existing policy.
2) Get Good Grades
Getting good grades (B average or higher) will typically qualify a student to receive additional discounts. (Pro tip – Making them pay the difference between the discounted rate and the normal rate until they get their grades up is also a great way to encourage them to study harder.)
3) Get Multiple Quotes
Car insurance costs are constantly changing. Many are surprised to discover that they could have been paying less for auto insurance all along. Our quote tool allows you to get a variety of quotes from different companies to ensure you are getting the best deal available.
Spending some time shopping around the various different insurance companies that offer car insurance in your state will likely net some additional savings. Every insurance company prices their auto insurance policies differently, so the price that a first-time driver is quoted from one company will be different when the same driver gets a quote from another company.
Competition between the insurance companies is a benefit to everyone who needs insurance, so take advantage and make sure you get auto insurance quotes from at least a few different insurance providers.
4) Encourage Safe Driving
Auto insurance premiums will drop drastically as your son or daughter gets older. Assuming they have a good driving record, these discounts are increased. Additionally, signing them up for a driver improvement, defensive driving, or new driver training course can also help you score points with your insurance company.
It’s also worth mentioning that newer drivers need to keep a somewhat clean driving record until they have built up a relationship (and the associated premium discounts) with their auto insurance company. By avoiding accidents, speeding tickets and other driving infractions, you can protect your driving record and take a lot of leverage away from auto insurance companies who will be more than happy to raise your rates if you start becoming a higher risk.
While you should always drive safely, it’s even more important during your first few years on the roads. Beat the statistics and stay safe, and you’ll also avoid higher auto insurance costs.
5) Choose a Safe Car
Many parents make the mistake of putting their teenager behind the wheel of an expensive and/or fast car. Such cars are extremely expensive to insure, especially with an inexperienced driver at the helm. Choose a safe car for your child, with all the available safety features. Instead of buying them a new vehicle, you can also just insure them to use you car, greatly reducing their time behind the wheel and your premiums.
Where To Go Now?
Armed with the tips above, those who are shopping for auto insurance for the first time should be able to get a decent deal that won’t break the bank. There’s no way to avoid paying a bit more than average when you’re a new driver, so don’t get discouraged if you have to spend a few extra bucks on your car insurance. Focus on keeping your accident record clean, stay away from costly infractions like speeding, and over-time your insurance premiums will gradually be reduced. In the meantime, enjoy your newfound freedom and safe driving!
To start getting quotes for new driver insurance, fill out our free quote from (above or below). You may also want to further educate yourself by checking out some other links we have prepared for you below.