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Car Insurance: Why Do Teens Pay Extra?

More often than not, when teens get car insurance soon after getting their driver’s license, it’s often more expensive compared to that of older drivers. Considering teens are younger and relatively inexperienced compared to those who have been driving for years, they need to climb the ranks in a way before they can be fully trusted by insurance companies. However, teen drivers can still find affordable car insurance, and a few of the ways can be found below.

Rating Factors Among Teens

Statistically, it’s much more likely for teenage drivers to get into accidents, commit traffic infractions, and be written traffic tickets than older drivers—factors that auto insurance companies must consider when deciding the risk of insuring teenage drivers. As well, strangely enough, male drivers often pay more for auto insurance than female drivers, a difference based solely on statistics.

Statistically, for example, male drivers under the age of 25 are more liable to not wear a seatbelt, drive a faster vehicle and with more passengers, drive more than female drivers, and chalk up more traffic infractions from parking tickets to DUI. Either way, auto insurance companies consider everything they can when determining a teen’s risk factors and therefore car insurance rates.

Other Rating Factors

Most rating factors for car insurance vary by the company and the state, but there are a few standard rating factors, including the following:

Gender and Age: As previously mentioned, younger drivers typically pay extra while female drivers tend to receive better insurance rates statistically.

Location: Drivers from rural regions who also park inside garages often receive lower insurance rates than drivers in urban areas who park in streets.

Marital Status: Often, married drivers receive lower premiums.

Driving Record: This plays a huge part in determining insurance rates. Insurance companies look at traffic violations, license status, accidents, and more.

Vehicle Make and Model: Older and modest cars often receive better insurance rates than flashier, newer models.

Vehicle Use: Everyday use or weekly use of a vehicle can factor in. As well, whether the vehicle is for work or pleasure is also a factor.

Insurance History: Any gaps in coverage can affect a rate quote. Insurance companies also consider how many claims drivers have filed and the reasons why.

How Teens Can Get Cheap Insurance

For teens, there are some ways to get more reasonable insurance, such as the following:

Choose a Safe Car: Often, insurance companies will more likely offer better rates to safe, modest vehicles than any flashier models.

Get on Parents’ Insurance: Teens don’t technically need their own auto insurance policy—they can just get on their parents’ policy. While this may raise their rates slightly, it’s likely less expensive than paying two policies, but compare the prices first.

Opt for a Higher Deductible: If teens are on their parents’ policy, it’s the parents’ choice, but choosing to pay a higher deductible usually lowers the monthly premium. Choose affordable deductibles, however, since, unfortunately, accidents can happen.

Complete Driver’s Ed: Car insurance companies love Driver’s Ed certificates because it indicates teens have learned the state’s rules for the road and have gotten behind-the-wheel training. Some school curriculums and states require the course—if not, consider taking it to lower car insurance rates.

Get Good Grades: Some auto insurance providers offer student discounts or some other form of financial relief for those who get high grades at school.

Keep a Clean Driving Record: Clean records go a long way toward determining auto insurance rates. Drive safely, and insurance rates are more likely to stay low.

Think you or someone you know is in need of Behind the Wheel Training? Training Wheels is a Ventnor driving school specializing in teaching new teen drivers how to stay safe on the road. For more information on our lessons, please click here.

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