Drivers under the age of 21 years in the United States pay more for their car insurance than older, more experienced drivers. This is because younger drivers run a higher risk of being involved in an accident and therefore claim from their insurance provider.
There are however other factors that influence car insurance rates. Taking these into consideration can help young drivers pay less for their car insurance.
1. Multi-policy Insurance
Multi-policy insurance provides different products under one umbrella, often at a lower cost than applying for independent policies. In other words, if you take out the car, life and household insurance from one provider, you will receive a lower rate or discount on your vehicle and other insurance rates.
2. Get Good Grades
Most people are unaware that insurers provide discounted rate for high school and college students who can achieve a B average or greater. A young driver may need a minimum of 12 credits to qualify.
3. Distance Students
After graduating from high school, most school leavers will continue their education at a higher learning or tertiary education establishment, often far from home. If your young driver is studying at a college, university or other types of school that is located more than 100 miles from home and is not using their vehicle during this time, you can take advantage saving on your auto insurance by temporarily removing them from your insurance policy. This offer usually only applies to students under the age of 23 – 25 years, depending on the insurance provider.
4. Safe Driving Course
Taking a driver safety course can provide you with a discount from your insurer. Young drivers are notoriously less experienced at driving and therefore more likely to cause or get into a motor vehicle accident. Safe driving courses, especially those promoted by insurance providers, will minimize this risk and therefore provide a discounted rate.
Liberty Mutual is a leader in promoting young driver safety through their teenSMART program which provides coupons for a simulated driving experience course to enhance their driving skills.
Research has revealed that teenSMART has decreased accident risk in teens and young drivers by a remarkable 30 percent.
State Farm provides drivers under the age of 25 years with a Steer Clear course which can result in a reduction of up to 15 percent on their insurance rate after completion.
Don’t settle for just adding a young driver to your existing auto insurance policy. Rates from different providers for teen and young drivers can vary widely. So shop around and compare prices from a variety of car insurance providers to find the best deal to meet your requirements. Keep in mind that it is most often cheaper to add a young driver to your insurance policy than to apply for an independent insurance policy. This means that you may have to change to a different insurance provider to save on your overall auto insurance costs.
Hope these tips will help you to save few hundred dollars per year if not thousand. Try to shop around to compare rate.