Alleviating the Cost of Adding Your Young Driver to Your Auto Insurance Policy
It’s no secret that adding a young driver to your car insurance policy can create a significant increase in premium each year. On average, most families can expect a $2,000 hike in the cost of their auto coverage when an inexperienced driver (licensed under 3 years) is included on their policy.
Although the possibility of having the cost of your coverage go up a few hundred dollars a month might make you cringe, there are ways to alleviate the financial burden of having a young driver added to your insurance policy:
Pick a reasonable vehicle.
If you’re going to finance or purchase a car for your young driver, it’s best to keep it modest and not select a sports car or other type of fast, high-powered vehicle. Not only is it a potentially safer choice for an inexperienced driver, but it will be more expensive to insure than a sedan or small SUV.
Something to keep in mind: Financing a vehicle requires Comprehensive and Collision coverage, which will add to the expense of insuring your inexperienced driver.
Share a car.
If you’d rather not add a new vehicle to your household, consider sharing a car with each other instead. When you share a vehicle, your young driver can be listed as a secondary driver on an existing policy, which will cost less than your young driver being listed as the primary driver of his or her own vehicle.
Eliminate comp and collision coverage on the vehicle your young driver is assigned to.
If you’ve assigned your teen to an older vehicle in the family that isn’t worth much, you might consider dropping comprehensive and collision coverage from your policy. Since this covers the car itself, you can decide if it’s worth paying for this coverage or to simply pay for any damage the vehicle might incur out of pocket, should something occur.
Increase your deductibles.
If you want to keep comp and collision coverage on your vehicle, you might consider raising the collision deductible on your policy.
Take advantage of discounts.
A variety of discounts exist that you and your young driver can and should take advantage of. These discounts include, but are not limited to:
- Defensive Driver Course: This can save you up to 10% on your liability, no-fault, and collision auto insurance premiums.
- Good Student Discount: If your young driver maintains a 3.0 GPA (B+ grade point average) in high school or college, they could be eligible for a Good Student Discount.
- Low Mileage Discount: Some insurance carriers will offer a discount to drivers that are on the road less than 10,000 miles a year. If your young driver is using their vehicle for local driving only, this is something worth checking in to.
Finally, once you have added your young driver to your policy, you can shop your auto insurance to see if you can secure the coverage you need at a more affordable price than what you’re currently paying. Feel free to reach out to our team at J. Hoffman Insurance if you would like more information or to get a quote: (845) 239-4787 or vicki@jhoffmaninsurance.com.
