How to pick the right car insurance for your teen driver
Getting a driver’s license is an exciting milestone for new drivers, but it can also be a time of stress for their parents or guardians. Aside from worrying about your child’s safety on the road, the cost of car insurance for teen drivers can be astronomical. To help you choose the right carrier for you and your teen driver, Bankrate’s insurance editorial team evaluated average rate data, discounts and coverage options for teen drivers from dozens of companies. From discounts geared toward new drivers to selecting the right vehicle and coverage types, here is what you need to know.
Key takeaways
- In most cases, drivers under the age of 18 must be insured on a parent's car insurance policy.
- Comparing quotes, coverage options and discounts may help you choose the right auto insurance company for you and your teen driver.
- Insuring a teen driver can be expensive, but maintaining a clean driving record and choosing your vehicle wisely may help keep your rates affordable.
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Powered by Coverage.com (NPN: 19966249)
Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
How to insure your teen driver
Insuring a teen driver should be a relatively simple process. You’ll likely want to add your teen to your auto insurance policy as soon as they begin practicing their driving skills. The following steps may guide you through securing coverage for your teen driver:
- Ask your insurance company about their new driver procedures. Depending on the state and your insurance company’s underwriting guidelines, you may only be able to add your teen to your insurance policy once they have an active learner’s permit. Understanding your company’s policies surrounding teen drivers may help you get coverage in place as soon as they start driving.
- Review quotes from other carriers. Adding a teen driver to your insurance policy can be expensive, but some carriers may offer more favorable rates than others for teens. Comparing quotes may show you if you could get a cheaper premium by switching carriers. This may also be a good time to compare coverage options and discounts from other carriers to see which may be the right choice for you and your teen.
- Once licensed, share the information with your insurer. When your teen has passed their driving test and secured their license, you’ll need to share their license number with your insurance company. Some insurance companies do not adjust your premium to account for the new driver until they are officially licensed. If so, this is when you would begin paying your adjusted premium.
Should I add my teen driver to my insurance policy?
Since purchasing car insurance is agreeing to a legally binding contract, most insurance companies will only issue insurance policies to drivers who are 18 or older. Even if your teen is a legal adult, insurance companies typically charge lower rates for teens on their parents’ policies compared to young drivers on their own policies.
Adult drivers with their own established driving histories and other rating factors may help offset some of the cost of adding a teen driver to their policy. Additionally, insurance companies may assume that there is slightly less risk in insuring a teen driver if their parents are sharing some of the degree of risk by financially tying their child’s auto insurance to themselves.
What should I look for in a carrier when I have a teen driver?
Finding cheap car insurance for your teen driver may be top of mind when you see what it could cost to add them to your insurance policy. However, there are other considerations you may want to take into account when choosing the right carrier for your family. Some things to potentially consider include:
- Available coverage options: What coverage types do you want for your teen driver? You may want to add roadside assistance coverage for extra peace of mind while your teen is on the road. If you’re worried about keeping your rates affordable, you might consider accident forgiveness coverage.
- Discounts for teens: Given how expensive it may be to insure a teen driver, many carriers offer discounts geared toward young drivers. Savings may be available for maintaining a high GPA, taking a defensive driving course or enrolling in a telematics program.
- Customer service and financial strength: Adding a teen driver to your insurance may be a great opportunity to evaluate your satisfaction with your current carrier. Reviewing third-party customer satisfaction scores and financial strength ratings may indicate how easy it could be to manage your policy and file a claim with a company.
Finding the best car insurance company for your family may mean switching insurance providers. If you’re having trouble choosing the right carrier after comparing quotes, speaking with an insurance broker who works with several insurance providers may help.
Why is car insurance for teens more expensive?
Teen drivers are among the most expensive to insure because their inexperience behind the wheel makes them more likely to engage in risky driving behavior and cause an accident. While the national average cost of car insurance is $2,014 per year for full coverage, the average annual cost to insure a 16-year-old driver on their parents’ full coverage policy is $2,494. As your teen gains experience behind the wheel and gets older, their rates will likely drop — as long as they maintain a clean driving record.
In states that allow them as insurance rating factors, age and gender can also influence the price teens pay for car insurance. Statistics show that females engage in less risky driving behavior than males, which may result in slightly lower premiums. For example, the average cost of a full coverage car insurance policy that includes a 19-year-old female is $3,186 per year. The same policy for a 19-year-old male driver is $3,503 per year — $317 more. This does not hold true in every situation or state. Hawaii and Massachusetts do not allow for age as a rating factor, and California, Hawaii, Massachusetts, Michigan, North Carolina and Pennsylvania do not allow for the use of gender.
How to save on teenage car insurance
When you have a teen driver, the increased cost to insure them can be high. However, some strategies may help you save on your auto insurance, even if you have a young driver on your policy.
Shop around for coverage
Comparing quotes from different carriers is likely the best way to see which carrier offers the lowest rates for you and your teen driver. When comparing quotes, you may also want to keep an eye out for discounts that may apply to your teen driver. Good students may save for having a high GPA, while teens who drive hybrid cars may earn a green vehicle discount.
Cost is a concern for many parents of teen drivers, but the right insurance may also help protect your financial future. According to the Centers for Disease Control (CDC), the cost of motor vehicle crash deaths among teens is about $40.7 billion. You may want to talk to your insurance agent about increasing your liability coverage to limits above the state minimum requirements.
Consider usage-based insurance
Some companies offer usage-based insurance, or telematics, for drivers looking to save on insurance. With usage-based insurance, the insurance company tracks the user’s driving habits through a device plugged into the car or a mobile app. Most companies offer an initial discount for allowing them to track usage and then adjust your premium based on driving habits. Some carriers, like State Farm, even offer telematics programs designed for young drivers. This method may also be a good way for you to track your teen’s driving to see if they are being responsible behind the wheel.
Choose your car wisely
The type of car you drive has an effect on your car insurance premium and may make a significant difference when insuring a teen driver. If you are in the market for a new car for your teen to drive, you might want to consider a used car instead. Used cars may be cheaper to insure, and you may be able to save even more if you don’t need full coverage insurance.
Learn more: How does your car make and model impact insurance rates?
Discuss habits with your teen
When teens get their licenses, they have a new set of responsibilities in their day-to-day life. You may want to discuss with your teen how their habits can affect them and others. Being a good driver may help them avoid tickets and accidents, which helps keep everyone safe on the road and likely allows you to maintain more affordable coverage.
Frequently asked questions
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There are a few strategies that may help you save money on teenage car insurance. Comparing personalized quotes may help you find the most affordable carrier for your circumstances. From there, looking for applicable discounts may help you save even more. Considering personal insurance rating factors for you and your teen, like driving record and vehicle type, may help you maintain low rates over time.
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Yes, adding a teen driver to your car insurance will usually increase your premium. One way to save money may be by waiting to get your teen their own car. When the vehicle amount equals the number of drivers listed on a policy, each driver is considered a primary operator. The vehicle assigned to your new driver will likely see a drastic spike in premium, while the other cars will be affected slightly less.
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As long as teen drivers maintain a clean driving record, they should see their rates decrease over time as they age and gain more driving experience. However, teens who purchase their own car insurance separate from their parents’ when they become adults will likely see a rate spike as they move onto their own policy. That being said, rates tend to decrease over time and essentially plateau between the ages of 25 and 30.
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Bankrate utilizes Quadrant Information Services to analyze 2023 rates for ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:
- $100,000 bodily injury liability per person
- $300,000 bodily injury liability per accident
- $50,000 property damage liability per accident
- $100,000 uninsured motorist bodily injury per person
- $300,000 uninsured motorist bodily injury per accident
- $500 collision deductible
- $500 comprehensive deductible
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