Is My Teen Driver Insured Under My Policy?

My teenage daughter just got her license last week. Will she be covered by my auto insurance policy?

Not necessarily. As soon as your son or daughter gets behind the wheel with a learner’s permit, call your insurance carrier and find out how this affects your policy and premium. Some carriers automatically add a household’s newly licensed driver to a policy, while others require that you individually add each person. The regulations for automatic inclusion vary by state, so be sure to research your policy and verify the status before your child becomes licensed.

This is extremely important: You don’t want to run the risk of having an uninsured driver because you assumed your carrier automatically extended coverage. Having a teenager on your policy will increase your premiums - sometimes by 100 percent or more. But the cost of not insuring your son or daughter could be immeasurable.

What Should I be Prepared for When Insuring My Teenager?

Know that your premiums will rise, and for good reason. According to the National Safety Council, drivers age 16-17 are three times more likely to be in a traffic accident than adults. Generally, boys cost more to insure than girls, and premiums drop once the driver reaches age 25.

My Teen is Now Insured. What Can I do to Cut Costs?

There are some tools available to parents who are trying to save money on their insurance premiums while their teens are on their policies. Strategies include:

• Raise the Deductible: Raising the deductible will lower your premium. Get quotes and compare pros and cons before making your decision.
• Combine Policies: Take out home and auto insurance polices through the same company. You might benefit from a multiple-policy discount.
• Smart Kids Get Good Deals: Children with good grades save their parents headaches and money. If your teen receives good marks in school - a B or better - his/her insurance rates will drop.
• Safety, Safety, Safety: Parents obviously want to select a safe car for their teens, but did you know that a safer car will save you money on insurance costs, too?
• Be a Role Model: Talk to your children about safe driving, but practice it, too. If your child sees responsible driving daily, it’s more likely that he/she will become a safe driver.