Adding Your Teens to Your Auto Policy: The Costs Involved and Ways to Survive It

As parents, we all want the best for our children in all aspects of life. A good education, a robust social life, a successful career, and most important, we all want our kids to be safe from harm.

One milestone we as parents rarely savor is when it is time for our children to drive. For many of us, this is the first time that our children’s lives are in their hands once they get behind the wheel by themselves. This realization is a remarkable moment in your life but is rivaled by another realization: Your insurance premiums just DOUBLED! In these days and times where many of us are doing our best to maximize resources, adding your children to your auto insurance policy is a definite interruption to the family budget.

In this piece, I will highlight the risks involved in making this change to your policy and discuss ways you can reduce your expenditures during this time in your family’s life. Please understand that no matter who you are and where you live, your insurance rates WILL INCREASE once you add your teen driver. What you as a parent need to do is understand your options and then make the best decision for your situation.

Teen drivers are inherently riskier to insure for many reasons. One is that a teen driver is inexperienced. This is one of many reasons why teens have the highest accident rates out of any other population group that operates motor vehicles. It is not a matter of IF your teen will get into an accident a lot of the time it is WHEN.

“A 2012 study by the AAA Foundation for Traffic Safety shows that young people are 50 percent more likely to have an accident in the first month they drive. The study also shows that accidents can occur in situations that include driving too fast during poor weather conditions, failing to yield and making left turns.”

Texting while driving is something most of us have done in our lifetime and is something that should NOT be done behind the wheel at all. Thanks to technology advances like Bluetooth, ONSTAR and other hands free devices, texting while driving has been reduced. That being said, it is still a problem and teens are especially susceptible to this because of the explosion of social media and the fact that teens spend a lot of time texting, tweeting and on Facebook. This can spell trouble for your teen driver and Insurers price accordingly.

“Although insurance rates are linked to how long and how good a motorist’s driving record is, insurers also know that teenagers have the highest fatality rate in vehicle crashes of any age group. Therefore they have less driving experience and are more likely to engage in risky behavior behind the wheel.”

There are steps you can take to reduce your insurance costs. This is definitely time to shop your entire insurance plans (Home, Auto, RV, MC, etc.). Many Insurance companies give discounts for good grades, driving courses for teens and multi-car policies. It will be less expensive in most cases to add your teen to your policy versus having them go at it alone. Also, taking a look at coverage options is crucial on all of your vehicles. Having an insurance professional go over your current plans thoroughly can help you save hundreds anyway, but especially now since you will need every penny to deal with the costs of insuring your teen driver.
This is a key moment in your life as well as your teen driver. They are excited to be able to cruise with their friends and are about to experience a new level of freedom. With freedom comes responsibility. As a parent it is up to you to instill this in your teen. By making wise choices in your Insurance strategy, you can navigate through this period of time with reduced stress and reduced costs. Maybe not stress though!

  1. TOO COSTLY TO DRIVE? HIGH CAR INSURANCE COSTS HAVE SOME TEENS BREAKING THE BANK Cinthia Nnez De Santiago. The Santa Fe New Mexican [Santa Fe, N.M] 16 Mar 2012: D.1
  2. YOUR WHEELS; The high cost of a teen driver at home; Inexperience and a record of risky behavior behind the wheel jack up auto insurance rates for young people Wright, Jeanne Los Angeles Times [Los Angeles, Calif] 26 Nov 2003: G.1.