When your teen driver gets their license, the first step is adding them to your insurance policy. From a cost and safety perspective, it’s best to add your teenager to your policy rather than have them take out their own policy.
A young driver will have a difficult time getting their own insurance policy, and the rates will be very high. Also, since teens cannot sign for documents on their own, you will still need to cosign the documents. The only time that it may be more beneficial for your child to have their own insurance policy is if they have purchased their own vehicle and will be driving that vehicle all of the time. Otherwise, it’s almost always in your best interest to put your teen under your insurance plan.
Teens and young adults with a driver’s license can be insured under their parent’s policy for any length of time as long as they live with their parents. Even when a child goes away to college, they can still be kept on their parent’s insurance plan, providing they are within certain proximity of their parent’s home. While most parents have no problem insuring their teen driver, they are often surprised to see just how much their bill rises.
Parents insuring a female teen driver will see their rates rise by as much as 50 percent, while parents insuring a male teen driver will see rates increase by nearly 100 percent. There are some ways to keep the cost of insurance premiums at bay, such as by purchasing a vehicle that handles accidents well and has features like anti-lock brakes and all-wheel drive. Getting good grades also results in discounts; however, the best way to keep rates down is by having a clean driving record.
Adding your teen to your insurance policy will definitely lighten your wallet, but it’s the best choice to make in most situations. If you have multiple family cars, choose the vehicle that is cheapest to insure and assign your teen to that one. Also, encourage healthy driving habits from the start. Remind your teen that being on your insurance plan is a privilege.