If you have a teen kid at your home, be prepared to hand them the keys to the cars soon. Or perhaps they already have gotten the taste of the tarmac and now are about to get the license to legally drive. But a car and a driver’s license are not the only things needed to drive a car. Your kid needs to have a vehicle insurance policy to legally drive a car. The expensive and logical question is, should your kid have their car insurance policy or not?
There are two options at hand here; either buy your kids their car insurance policies, which include liability insurance, comprehensive and collision insurance, personal injury protection, Med Pay, and some other additional ones. This is the first option.
The second option is you can add them to your car insurance coverage so they can drive and learn. So which one of the two is preferable? The second one. Adding your kids to your vehicle insurance policy is much better than buying separate policies for them. But why? Let us elaborate.
Car Insurance for Teens is Expensive
It is already a difficult task to find affordable and great car insurance coverage for adults. But when it comes to teens, it becomes downright impossible. Auto insurance rates are decided mostly by looking at statistics. Teens are responsible for most road accidents in the US.
A higher risk of a car accident or an insurance claim results in higher prices for auto insurance coverage, and car insurance companies understand this. Teens are charged the highest, especially people under the age of 20 with rates decreasing as age increases.
So let’s say that you want to get complete car insurance coverage for your teen child. This includes the essentials such as liability insurance, personal injury protection plan, comprehensive and collision coverage, Med Pay, etc. The estimated average price of all these policies combined for teenagers can go as high as $7,000. That’s more than the price of a used car!
This excessive cost is the reason why buying a separate car insurance policy for your kid is not recommended. Adding them to your existing car insurance policy is a much better and cheaper way of protecting your child from getting into a legal and financial pit.
Adding Your Kid to Your Policy
If your kid is about to get a driver’s license or has one but no auto insurance policy, then adding them to your car insurance policy is the best thing to do. This will increase your insurance premium rates for sure, but it would still be cheaper and more convenient than getting separate policies for them.
On average, you can expect a price hike of anywhere between $1,500 to $1,800 if you add your kids to your policy. Girls are charged less than boys due to the statistics that show boys are more likely to get in a car accident, drive under the influence, or get speeding tickets.
It is important that you already have great and affordable car insurance. This would prevent any extra costs from piling up and make your policy even more unaffordable. If you are looking for any additional car insurance policies, make sure that you search with specific questions, especially in your state.
For example, if you live in Georgia, look for the cheapest car insurance quotes in Georgia and select the policy that not only offers great policies at a low price but also has great reviews and a faster claim resolution process.
Now that it’s clear what should be done when your kid starts to drive a car, let’s look at all the possible ways you can bring down the cost a little more and save some money. Here are all the tips to save money when you add a kid to your car insurance coverage.
Tips to Save Money
No matter what you choose, adding your kids to your policy will be expensive. But there are ways you can mitigate the damage a little and save some money. Follow these tips and you might be able to save hundreds of dollars.
Get a Used Car for Your Kid
If your kid needs a separate car, and you want to save money, then do not get a new car. Always go for a simple, used car. This works in two ways to save you money. First, you don’t have to pay a lot to buy a brand-new car. Used cars can be bought at a low cost while they serve the same purpose. And if your kid is learning to drive, it is better to get a used car since you can expect a few dents and scratches here and there. A dent on a new car hurts more than on a used car.
The other way of saving money this way is for car insurance companies to charge less for insuring used cars than new cars. This is because it is much easier and cheaper to fix a used, daily-use car than a brand new imported car with a fancy name. Ford, Honda, Toyota, etc are the best brands to go with, while choosing the type, getting a small car is much better than going for an SUV or a sedan.
Students Discounts and Other Discounts
Almost all the popular car insurance companies offer students discounts. If your kid gets good grades (could be a GPA of 3 or above, but the specifics vary from company to company), you can save as much as 25% of your car insurance costs. Just make sure that you ask about this to your insurance agent. Getting into driving courses such as defensive driving or something similar can also get you great discounts.
The bottom line would be to ask your insurance agent or company about all the possible discounts that they offer to reduce the cost of adding your kid to your car insurance policy.