July 11, 2015
Affordable Car Insurance for Under-25s
by Nik Donovic
Car insurance for young drivers can cause sticker shock, but there are apps and other methods for bringing rates down.
Parents of new drivers know what they are up against when they are faced with insurance rates, but the increased premiums can still be a bit of a shock. Because teen drivers are considered to be the most “at risk,” insurance rates are expensive. In fact, insuring a young male driver may boost an insurance bill by 92%, while a female driver of the same age will boost the bill about 67%.
Before You Insure, Talk With Your Teen
Your teen may assume that, as soon as she is licensed, she has the freedom to drive immediately and as freely as she wishes. Before you insure your teen, talk to her about your expectations, such as distraction-free driving or driving during daylight hours. Make it clear that if your expectations are not met, you can cancel insurance and revoke driving privileges or you can ask your teen to take some of the financial responsibility of the insurance premium. Given the hefty price tag, you will probably have a teen committed to safe driving. Make decisions that work for you and your family and stay firm with your expectations. Remember, your teen driver must be insured, even if she drives infrequently.
Holding Your Teen Accountable for Safety
If your teen agrees to drive safely and adhere to any of your driving rules, he will most likely have the best intentions of sticking to it, but teens are sometimes easy to persuade; the whole peer pressure thing is still alive and well, including when it comes to driving.
Fortunately, there are apps and tracking devices to monitor the way your teen really drives. While you may feel like you are overstepping your grounds of trust, think of monitoring as added security. These apps/devices will not only encourage your teen to drive safely and keep him safe on the road, but may also get you an insurance discount from certain companies:
- Tracking Driving Habits With GPS: There are several relatively inexpensive products on the market that plug directly into the car’s diagnostic port and track driving habits. You can set particular speeds or perimeter limits, and if your teen driver exceeds the speed or goes “out of bounds” you will be notified via text or email. Being able to “see” the way your teen really drives can help you have constructive conversations about her driving choices and habits. There are also a few apps on the market that will do the same thing as the plug-in tracker.
- Prevent Texting and Driving: One thing that most teens will continually try to do is text and drive, regardless of the laws or safety concerns. Rather than struggling to take the phone away, install an app that will prevent your driver from texting while driving. This app must be turned on by the driver (so there is a level of responsibility and trust required), but once it’s working, the app will prevent the driver from seeing or hearing any incoming messages or calls.
Decreasing Insurance Rates Before 25
While insurance rates often decrease when the young driver turns 25, there are ways to have discounted insurance for your teen. Depending on your insurance, you may be able to receive a reduced rate if:
- Your Teen Gets Good Grades: Some insurance companies offer a discount if your teen driver maintains a certain GPA. This is just another incentive for your teen to try harder at school. The situation is basically a math problem: Good grades=Car privileges.
- Drive a Safer Car: Although a standard sedan may not be your teen’s dream car, if it’s got a good safety rating and airbags/anti-lock brakes, you may be able to receive reduced insurance.
- Take a Class: Many older drivers can receive an insurance discount if they take a class to brush up on their driving knowledge, and some companies offer the same for teen drivers.
If your teen commits to driving safely, makes efforts to keep insurance rates low and keeps a clean driving record, his car insurance premium should be lower before the magic age of 25.
Whether your teen driver is in a crash with an uninsured driver or if you fail to provide your young driver with insurance, you may need to hire a car accident lawyer to help you sort out any legal issues in the event of a car accident.