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Top Ways To Reduce Teen Car Insurance Rates

Your teenage child is probably thrilled about being able to drive. Though you may appreciate being freed from transportation duties, this comes at a price…and it is usually steep. Auto insurance premiums for teenage drivers tend to be sky-high, jacking up the cost of family policies. However, there are ways to reduce this expense significantly so the teen can remain behind the wheel without sucking the bank account dry.

Parents with confidence in their driving abilities can increase deductibles for collision and comprehensive coverage to $1,000 or higher. In addition to reducing insurance premiums, this prevents the adults from filing small claims that would erase any claim-free discounts. By stashing away some cash to cover this deductible, parents prepare themselves for the worst.

The retail and trade-in values provided by a reputable source like Kelley Blue Book should be used to determine the value of an older insured vehicle. If the car is not worth much more than the policy deductibles, parents can drop the comprehensive and collision coverage on it. There is no reason to throw money away by paying higher auto insurance premiums than will be recouped in the event of an accident.

Many insurance companies offer multipolicy discounts, reducing the cost of all policies held with the same company. Parents can insure their homes and cars at a discount through a single insurance provider and may receive an additional discount for purchasing an umbrella policy that features additional liability coverage. By shopping around for coverage on an annual basis, parents get the best deals each year.

Teenage drivers with good school grades do their part to reduce car insurance premiums. Most major auto insurers offer substantial discounts for young adult drivers who maintain a B or higher grade average in high school or college. A college student may be required to carry a minimum class load of 12 credits to qualify. If the child attends college at least 100 miles from home and does not take a car, the insurance company may offer a large premium discount for continuing to cover this driver.

Teen drivers who participate in driver safety programs may be eligible for additional discounts from auto insurance providers. Attending a special class, reading a driver safety manual, watching a DVD, and taking a test can really pay off. Getting the young driver a safe car should also reduce premiums and has the added benefit of decreasing parental worry.

*Photo Courtesy of Steven Saus via Creative Commons License