Adding a teen driver to your car insurance policy

It takes time for teens to learn how to drive safely. But parents who are going to be adding a teen to their policy often need education themselves. That’s why it’s important to know how to add a teen to an insurance policy and what factors will affect the price of the premium.

Preparing a teen driver

When Lesa Christiancy’s daughter turns 16 this summer, parents and daughter will all be ready. Since Christiancy and her husband, Clair, of Nebraska, have done this before, they know how to prepare for adding a teenager to their car insurance policy.

“One thing we did differently with our daughter from what we did with her two older brothers was to buy her car nine months ahead of her turning 16,” Christiancy says, explaining that Nebraska state laws allow teens to get a learner’s permit when they turn 15.

“This has given her the opportunity to drive with an adult rider for a longer period of time so she could practice driving in all kinds of weather conditions. We’re hoping that will make it less nerve-racking for us the first day she takes off on her own!”

Adding a driver to car insurance

Not all states have the same laws and internal guidelines for insurance companies may vary, so it’s important to check with your agent to find out what laws apply to you. Many companies allow a teen with a learner’s permit to be listed on the policy at no charge until he or she becomes a licensed driver – but don’t assume that’s the case. The best time to talk to your insurance provider is before your new driver gets his or her permit. That’s also a good time to find out what it will cost to add a teen to your policy.

Getting a good deal on teen car insurance

“The biggest shock for us was the increase in rates for all the vehicles on the policy, not just the one our teenager would normally drive,” Christiancy recalls. “The only discount we were aware of was the good student discount, and our agent helped us obtain that.” 

However, other discounts can apply for families, low mileage and signing up for a program to monitor your teen’s driving, so make sure you take time to sit down with your agent and go through all the possibilities. Try to include your teen in the discussion so he or she will realize what kind of impact their actions have on the family budget. 

For the Christiancy family, bundling home and auto policies with their insurance provider helped save them money. She advises that parents ensure their teens help shoulder some of the responsibility of the increased cost, even if they can’t contribute financially.

“Make sure your child understands that earning good grades will help with the financial aspect of insurance. Thankfully, our kids are all good students – and that made a big difference for us.” 

Other ways to get cheap teen car insurance

- Pick the right car. “We started looking at insurance rates the same time we started shopping for our oldest son’s first car, as vehicle age and model had a bearing on insurance premiums,” Christiancy says. Sedans, minivans and SUVs can typically have the best rates for teens.

- Share a car. Instead of adding another car to the policy, share one that is already on the policy and make your teen the secondary driver. It may cost less than if the teen were the primary driver on a car. 

- Consider postponing getting a license. Younger drivers can mean higher car insurance costs, so if a car is a “want” and not a “need” at the moment, you could notice considerable savings by delaying getting a license until your driver is 17. 

- Raise your collision deductible. Increasing your comprehensive or collision deductible from $500 to $1,000 could save money on your monthly premium, although you’ll want to keep in mind that, in the event of an accident, your out-of-pocket costs will be higher. However, a few years before your teen is licensed you can add a vanishing deductible to your policy to help accrue deductible credits, so if an accident does happen you might pay less out of pocket.

Christiancy says the family has saved money by checking with their insurance provider before making car purchases and then choosing cars that were mechanically sound but already had some scrapes and dings. 

“Teenagers are going to get into accidents, even if it’s not their fault,” she says, noting that her second son’s car was hit twice in the school parking lot by other teen drivers. “A new car will cost a lot more to insure and repair.” 

A good place to start is to have a conversation with your agent to learn about your options for adding coverage for your teen to your existing policy.