If you’ve recently welcomed a new driver into the family, you know the mixed bag of emotions that comes with it. Excitement, a little pride, and then, the realization about auto insurance costs.

Let’s be upfront: adding a young driver can significantly impact your premiums. We’re talking a potential increase of $400 to $450 a month. That’s a significant jump for any budget!

But before you start worrying about dollar signs, there are smart strategies to help manage these costs. Here are some practical, straightforward tips to help keep those rates in check.

Tip #1: Emphasize Defensive Driving, Constantly.

Our roads, whether urban or rural, demand skilled drivers. Teens, still new to navigating complex traffic, are essentially learning in “expert mode.” Statistics show they are at higher risk for accidents, making ongoing guidance crucial.

So, make defensive driving an ongoing conversation. Regularly discuss anticipating hazards and avoiding collisions. Every incident-free period keeps claims off your record, which directly benefits your insurance rates. It’s a win-win for safety and savings.

Tip #2: Keep Them on Your Policy for as Long as Possible.

It might seem counterintuitive to keep them under your umbrella, but generally, it’s the most cost-effective approach. As the primary policyholder, you benefit from established multi-driver discounts, marital discounts, a strong credit history, and a stable job record. These factors collectively help offset the increased risk of a new driver.

Consider keeping your teen on your policy until they reach 21 or 22 years of age. At this point, their own independent rates often become more competitive.

Tip #3: Reconsider That New Car Purchase.

This tip often surprises parents, but it’s important. While the idea of upgrading your car and passing down your current one to your teen is appealing, remember, a teen driver on your policy impacts the rates across all vehicles insured.

Even if you intend for them to drive only the older car, life happens. Prom nights, special events, or emergencies can easily put your teen behind the wheel of your newer, more expensive vehicle. Insuring a newer car with a young driver can substantially increase your premiums.

For now, embracing a more modest vehicle can lead to significant savings on your auto insurance. Your wallet will thank you!

Adding a teen driver is a significant life stage, and managing the associated insurance costs is a real concern. By implementing these practical tips, you can make informed decisions that benefit both your family’s safety and your budget. Contact us today, we’ll answer all your questions!

Video Transcript:

How to save money with a youthful driver.

I’m going to be honest, it’s challenging.
Youthful drivers add about 400 to $450 a month to your insurance payment.

But here are some tips to keep the rates down.
One, talk with them often and more often and more often about how to be a defensive driver.
Especially with aggressive driving in the cities, even rural areas, teens are having to learn to drive in expert mode.
It’s challenging and teens statistically are not great drivers.
So continuing to have those conversations to keep accidents and Fender benders off your claims history will help.

2 They’re better off with you on your policy.
You have the multi driver discount, marriage discount, you have credit, you have job history, you have a lot of things that teams don’t have.
So keeping them on your policy till they’re about 21-22.
About that time you can start looking to get them quotes off of their policy and onto their own, off of your policy and onto their own policy.
Do not get them a new car.
Don’t even get yourself a new car.
I know sometimes parents get excited and they think, oh, I’m going to give my teen my old car and I’m going to get a new car.
Teens affect the rates on all the cars on the policy because let’s be honest, at some point they’re probably going to drive your new car.
Even though parents swear up and down my teen is not going to drive my car prom, something special comes along and they hand over the keys to that brand new car.
And so, yeah, so there are some tips for saving money on your auto insurance with your teen driver.