Insuring Teenage Drivers and Earning Teen Driver Discounts

Recently I saw an episode of “Two and a Half Men” where the teenager, Jake, was learning how to drive. As Jake prepared to turn into traffic, Uncle Charlie sat in the backseat and performed the sign of the cross—an apropos gesture, indeed.

After all the soccer games, cheerleading practices, recitals, etc., it’s convenient to have one (or ten) fewer errands to run yourself. A teenage driver may be helpful, but the statistics on teen accidents are alarming. If you allow your teen to become a licensed driver, you may have sticker shock when you see the premium charge of adding a teen driver to an auto policy.

However, there are discounts that can help minimize the auto insurance premium increase you’ll pay. Here are some guidelines for ensuring you get a good price on a family auto insurance plan:

Consider a car that has various safety features, such as antilock brakes and daytime running lights and an alarm system. Consumer Reports recently appeared on the CBS “Early Show” to demonstrate safe cars for teens and seniors.
Find out if your child is eligible for the good student discount. Typically, insurance companies like to see your child pull at least a B average.
Notify your carrier if your teen is away at college. If your college student isn’t driving the car regularly, it will help minimize your premium for that year.
Have your teen take a defensive driving course. (And consider taking one yourself—it will provide a discount for any driver.)
Pay for the entire term period up front to get a “pay in full” discount. It costs the insurance company less, since it saves them the hours it takes to send reminders and reinstate a policy.
Get an annual policy rather than a monthly or six-month policy term.
Don’t wait until the last minute to set up a new policy or renew an existing policy. Some carriers will offer a discount for giving several days’ advance notice.
Have your agent or carrier quote higher limits to see the premium difference. Some carriers will encourage you to purchase higher bodily injury limits by offering a discount.

Unfortunately, teen accidents are usually a matter of when, not if. Get the right insurance for your needs, and make sure your teen driver knows what to do in case of an accident.

Linda Rey is a licensed insurance agent at Rey Insurance with a broad spectrum of expertise in life, accident, health, property and casualty insurance as well as retirement planning and college funding strategies.