How to Save Money With Teenage Auto Insurance

You can save money with auto insurance even if your household contains a teen driver. Insurance companies typically charge higher premiums on policies that include teenagers due to the fact that a teenager’s lack of experience places him at a higher risk of an accident. Shopping around for a reasonably priced policy is a must, but you and your teenager can reduce your insurance premiums in other ways as well.

Talk to Your Teen about the Importance of Good Grades

When evaluating a teenager’s risk level, an auto insurance company doesn’t have the benefit of pulling credit reports, and teenagers have very limited driving records--if they have them at all--for insurance providers to go by. Thus, most insurance companies determine a teenager’s responsibility level by reviewing his academic performance. The assumption is that teenagers that work hard in school are more responsible overall than those who don’t. Completing a driver's education course can also reduce your teen's insurance premiums.

Ask Your Teen to Help with Insurance Costs

When your teen gets his driver’s license, allow him to get a part-time job after school. You can then request that your teenager pay a portion of his monthly vehicle insurance bill in order to maintain his driving privileges. Not only does this minimize the cost of auto insurance for you, but it is also a good lesson for your teen in responsibility and managing finances.

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