In general, getting cheap insurance for young drivers requires many of the same steps as for older drivers. However, there are some exceptions. Young or old, with the following information, the cheapest, or least-expensive insurance, can be found.
The biggest factors in car insurance premiums are:
- Gender: females get lower rates
- Location: Urban rates are higher than rural areas and there is a difference according to state (since state law affects insurance costs).
- The type of the insurance coverage
- Type of vehicle
- Driving record to include violations, accidents and claims as well as how long one has been driving.
While little or nothing can done about the first three factors other than move or not drive, the other three can be influenced to help young drivers get the cheapest insurance rates possible.
Type of insurance coverage
As with most insurance, having a higher deductable usually saves money over time. The savings in premiums will add up, and it also eliminates the need to report smaller incidents to the insurance company (although these will generally not affect premiums). Therefore, go with the highest deductible that can be afforded. In addition, holding young drivers responsible for the deductable in the case of an accident can add extra incentive to drive safely.
When the car is not being financed, it may be a good idea to drop collision coverage entirely. This of course is a gamble, but it is often worth considering, particularly of the car has a lower value.
Type of vehicle
Not surprisingly, newer cars, sports cars and those that have been modified are going to cost a lot more to insure, and collision will be required if the car is financed. Furthermore, remember than those cars that are popular with thieves cost more to insure, so check before purchasing.
Finally, remember that safety and anti-theft and safety features can sometimes reduce premiums. Therefore, an older car that lacks anti-theft and safety devices such as anti-lock brakes, air bags, etc. may not be any cheaper to insure than a newer, more valuable one.
Car insurance for young drivers costs enough without adding a bad driving record to it. This, combined with the very real danger of death or serious injury from careless driving, makes it vital to do everything in one’s power to get young drivers to be as safe as possible. This is obviously easier said than done. Parents need to use every method available from education and setting a good example to sanctions. For something this important, the following book is highly recommended and suggested for any parent with a young driver.
How claims and infractions can affect rates
In the case of accidents, its severity, who was at fault and if there were injuries will all affect premiums. Every insurance company has a cutoff point where the claim is considered minor enough not to drive up costs. When larger accidents or driving infractions to include speeding tickets do occur, they will remain on record and count against rates for 3-5 years, and can drive up rates 20-40%. At the end of this period, check with the company to see whether rates will come back down. If they do not, it may be time to look for another company.
When will rates start dropping?
16-24 are the most dangerous years, and teenagers are four times more likely to be involved in an accident than other age groups. Depending on the driving record, there will likely be changes in rates at 18, 21 and 25. It is a good idea to check with the insurance company at these points also and consider changing companies if there are no changes in rates.
However, keep in mind that the most important thing is to keep a clean record. Once the driver has three years of experience and has kept a good record, they will be far more likely to qualify for various discounts. If the driver has been insured for three years without any accidents, many companies will reduce rates by up to 20%.
Joining parent or guardians insurance
For most young drivers, the cheapest rates, and often the only way they can get car insurance, is to join a parent or guardian’s protection plan. Not surprisingly, any serious claims or violations will drive up the parent’s premiums.
Safe driving programs
By completing an approved course (some, to include those at I Drive Safely can be done online), drivers are often eligible for special discounts. Check with the state DMV and the insurance company to see what may help.
Other things to do to get cheap rates for young drivers
- Good grades: A GPA of 3.0 or better, and sometimes majoring at a certain subject in school, will qualify a driver for a good student discount.
- Resident student: When drivers live at the school and leave their car at home, they can qualify for lower rates. As with any age, those who live close to their occupations and show they drive less can also get low mileage discounts.
- Good credit: Insurance companies sometimes look at one’s credit rating as a risk factor. Therefore, building a good credit score can lower rates.
- Marriage: For those who are ready, getting hitched may lower their rates.
Monitoring devices: Electronic systems that record driving data can help with some insurance.
- Do not let coverage lap: Maintaining continuous coverage when comparing rates with different companies helps.
- Pay premiums up front: There are lower billing fees when premiums are paid up front for longer periods. In addition, since rates are adjusted when policies are renewed, sometimes paying up front can delay rate increases for driving infractions.
- Just ask: Insurance companies are not always eager to inform customers of special discounts. It never hurts to ask.
While it is nice to use a local insurance company, and sometimes bundling and buying more than one type of coverage from the same company brings cheaper rates, everyone needs to use the power of the internet to get multiple quotes from different companies. The best way to do this can be found at direct car insurance.
Most of the same tricks for getting cheap insurance for young drivers can also work for older drivers. Keep above information in mind regardless of age.