As most parents find out, covering the insurance rates for teen drivers can be a financial struggle. Insurance companies usually charge a pretty penny, but for good reason. According to the Centers for Disease Control and Prevention (CDC), motor vehicle crashes are the leading cause of death for teenagers. As it turns out, teens also account for around $19 billion worth of motor vehicle crashes annually.
Because such crashes end up costing insurance providers so much, those expenses are passed on to the consumer. The good news is that it is not a lost cause. There are things you can do to get your teen drivers covered and still keep the expenses low enough to fit into your budget. But it will require that you be proactive about the process.
Keep these tips in mind when it comes to covering your teen on a budget:
Budget and Your Teen Plan. Start by figuring out what rate you can comfortably afford. Rather than trying to come up with the payment each month or every few months, figure out what you need to set aside each week to make the payment. A weekly payment will be easier to come up with than one large one.
Get Teens to Chip in. Most teenagers today have at least a part-time job. Come to an agreement with them about what they will contribute toward their insurance payments. If they don’t have money to contribute, find other things they can do to help ease your financial obligations so that the money can be put toward their insurance premiums. For example, if you usually pay to have your lawn cut, have the teen start cutting the lawn, and put the money you would have spent on that each month toward insurance.
Find Teen Discounts. Insurance companies offer discounts for everything from getting good grades to maintaining a clean driving record. Ask what discounts are offered, and see what you can do to lower your rates. You can also check into raising your deductible to save on premiums.
Teen Driving Do’s. When it comes to your teen getting behind the wheel, one of the easiest ways to keep your premiums down is to make sure there are no accidents or tickets, since either of those things will cause an increase in rates. To keep the bills down and keep your teen safe, have them avoid driving with passengers and avoid driving at night. Both of these things, according to the CDC, frequently raise the accident rates of teens. Also, if there is a small fender-bender, consider not reporting it. If you do, it will end up raising your rates in the long run.
Look and Shop Around for Savings. You have likely heard this before, but it deserves to be said again: you get the best auto insurance rates when you actively shop around and keep up on what companies are offering. Doing this at least twice a year will ensure that you are getting the best possible rate.