Cheap Auto Insurance for Teens: How to Get the Best Rates
Did you know that teenagers and young adults around 16 years of age have some of the highest car insurance rates in the country? They typically pay more for car insurance than mature drivers because insurers consider them high-risk behind the wheel.
The good news is that there are plenty of teen driver discounts that can help lower the cost of premiums for young and new drivers – and we’ve found them all. If you’re looking for the best rates on insurance for younger drivers, we’ve got you covered. Here’s a rundown of our best tips for keeping your child safe on the road—while also saving big on your monthly premium.
How Much is Car Insurance for Teenagers?
Teenagers and new drivers are often still learning how to drive safely on the road. The cost of insurance for teenagers is often much more expensive as they are considered a higher risk driver to insure.
A 16 year old driver can expect their auto insurance costs to be anywhere from $2,955 to $3,400 a year for full coverage, while an 18 year old driver will pay a little bit less after being on the road for a couple of years with a clean driving record.
The average car insurance rate for drivers ranging in age from 20 to 25 years old is about $2,200 a year for full coverage – which is nearly $700 more a year than the average rate for a 40-year-old driver.
Why Is Insurance So Expensive for Teen Drivers?
It should come as no surprise that teen drivers are the most likely to engage in risky driving behaviors. And because insurance companies determine their rates according to a driver’s level of risk, it makes sense why drivers under 25 years are burdened with higher insurance premiums. According to the CDC, younger drivers are more of a danger to themselves and other motorists on the road than nearly any other age group for the following reasons:
- Less driving experience
- More likely to speed
- More likely to drive without a seatbelt
- Higher rates of alcohol use
- More likely to be involved in an accident
How Teen Drivers Can Save on Auto Insurance
The good news is that while insurance is most expensive for younger drivers, it is still possible to save money by taking advantage of discounts and programs that can lower costs significantly. Here are a few discounts and options for teen drivers that can help them save on their overall costs for auto insurance:
- See if Your Teen Qualifies for the Good Student Discount
If your kids are getting good grades, it can actually help alleviate your car insurance bills. Most insurance companies offer a big discount for young drivers who can demonstrate that they do well in school, maintaining at least a B- average in high school or college. College kids generally need to take at least 12 credits to qualify for the discount.
And just how much can the good student discount impact your rates? Most drivers see between 10 and 15% in savings on their monthly premium, although some insurers may offer as much as a 25% discount for high-achieving students. Best of all, the savings last as long as the good grades do, until a student turns 25.
- Enroll Your Teen in a Driving Class
Even if your state doesn’t require it, signing up for drivers ed or a defensive driving course can keep your child safer behind the wheel by lowering their chance of being involved in an accident. And because that can make them less of a risk on the road, most insurers offer a discount on insurance rates once your young driver has completed a course. Drivers who take these courses may be eligible for a 10% to 15% discount on coverages.
- Encourage Them to Drive Safely
It’s no surprise that young, inexperienced drivers are more likely to take risks like speeding and not wearing a seatbelt. In fact, one study found that drivers ages 20 to 24 are involved in more crashes than any other age group besides teens. As a result, 25-year-old drivers pay nearly 25% more a year for full coverage car insurance after one speeding ticket and almost 50% more annually after a car accident. As simple as it sounds, a clean driving record—free of tickets and accidents—can save hundreds and even thousands of dollars a year on insurance expenses.
- Ask Your Provider About the Distant Student Discount
If your young adult driver lives away from home to attend college and leaves their car parked in your driveway, they might be eligible for a distant student discount. Most insurance companies will reduce your monthly rate if the student lives a specified distance away (usually 100 miles or more) and is attending college full-time. Best of all, your young driver will still have coverage when he or she comes home for vacation. The distant student discount can give you a big break on your premiums, especially when combined with the good student discount.
- Look at Low-mileage Discounts
From an insurer’s perspective, the less time spent on the road means the less chance of an accident or claim. If your child drives under a certain number of miles per year, you may be eligible for a low-mileage discount. The price break varies depending on your insurer, but it can save a lot—especially when paired with the similar distant student discount. Young drivers who qualify for the low-mileage discount typically see a savings of anywhere between 5% and 30% on monthly rates.
- Consider the Car
Your teen may be dreaming of a brand-new, high-performance car for their sixteenth birthday. Unfortunately, that type of ride won’t do anything to help lower monthly premiums. If you’re eager for better insurance rates, an older, simpler vehicle with high safety ratings is the best bet for your young driver. A gently used or modest sedan will be cheaper to repair or replace in the event of a collisionAre inexpensive to repair or replace. Regardless of the age of the car, make sure it’s stocked with safety features such as anti-theft devices, airbags, and anti-lock braking systems, which can net lower premiums or make you eligible for specialty discounts. If you plan to buy a car for your new driver, talk to your insurance company before you begin car shopping. An agent will be able to tell you which makes and models will be the cheapest to insure.
- Increase Your Deductible
If you’re in a financially stable position you might want to consider raising your comprehensive and collision deductibles. This simple move will lower your premiums by up to 5% to 10% and will also prevent you from filing small claims that could jeopardize a claims-free discount. Keep in mind that while increasing your deductible will lower your rates immediately, it may cost you more money in the long-term if you can’t afford to make a claim.
- Drop Unnecessary Coverage
If your teen will be driving an old car that’s not worth much—say, little more than the deductible—it might make sense to drop collision or comprehensive coverage entirely. After all, if the car were involved in an accident, you could be responsible for paying more in premiums than your insurer would ever reimburse. If you do decide to reduce your coverage, make sure that you are still complying with your state’s insurance laws, as well as any coverage requirements from your lender.
- Compare Quotes From Multiple Car Insurance Companies
In addition to age, insurers use a variety of factors to determine rates, including gender, location, and a car’s make and model. Because each company weighs these factors differently, it’s important to compare costs to ensure that you’re getting the best deal. Before you settle on a provider, make sure to get car insurance quotes from at least three carriers for equal amounts of coverage. To really maximize your savings, you may even want to shop around every six months to a year, before the policy is about to be renewed.
Lower Your Rates for Good With Affordable Car Insurance
Now that you know how much you can save on your teen’s auto insurance each month, it’s time to find a policy that fits your needs and your budget—and we’re here to help. Thanks to our fast and affordable online car insurance quotes, you can choose a plan and get your coverage in just minutes. Get yours today and rest easy knowing that your teen will be a safer driver—while you’ll be saving money each month.