Get a family policy
It's usually more cost-effective to add your teen driver to your own policy than it is to get a separate one for them. You can have them pay you for the extra cost if you want them to take on responsibility for paying for their insurance.
Whether or not you add your teen to your policy, it's standard for insurance companies to assume any driver in your house can drive any car. To save costs, you can exclude them from certain cars, but remember they will not be covered at all if they ever drive that car.
Raise your deductible
Raising your deductible can help you offset the costs of adding a teen driver to your policy. By saving insurance for big repairs, you can eliminate the cost of insuring minor scrapes.
Do not forget that if you are currently leasing or financing, your contract may have a minimum deductible, so check before you make changes.
Ask for a student discount
Most insurance companies offer discounts for teenagers with good grades, with the assumption that good students are more responsible, including when they drive. To get this discount, you'll need to call your insurance company and maybe provide a report card.
This can also be a good way to motivate your teenager to do better in school if their insurance payments or driving privileges depend on their grades.
Enroll your teen in driver's education
You may want to teach your teenager how to drive, and you should spend time doing so, but don't skip a driver's education class. This gives them a more formal education, as well as making sure they do not just dismiss the safety tips you teach them.
Insurance companies believe that these programs make safer drivers and will often offer discounts for teens who complete them.
Weigh your buying decision
You want a safe and reliable car to protect your teenager, but this doesn't necessarily mean buying new. Used vehicles may meet your requirements and often cost much less to insure than brand-new cars.
Before you add a car to your family, get insurance quotes for each year and model you're considering.
Set ground rules
If you think getting a ticket or getting into an accident will send your insurance premium skyrocketing, you do not even want to think about what your premiums will be if it is your teenager doing it. Set clear ground rules to keep them safe and out of trouble.
- Limited driving at night
- A limited number of passengers
- No cell phone use at all, even if legal
- Driving only in allowed areas
- Insisting on passengers using seatbelts
- No eating
Learn more about insurance
Adding a teen driver is a big step, and your existing insurance company may not provide the best options even if you're happy with them. You may also be able to save money by bundling your coverage with your homeowner's policy or other policies. To learn more about your options and how to save money, talk to TDECU Wealth Advisors.