When to Add Your Child to Your Car Insurance
Teen drivers are some of the riskiest categories of people to insure, so parents often want to wait as long as possible before adding the child to the family car insurance policy. Specific rules for when the teen needs to appear on the policy vary depending on your insurance company and what state you live in.
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Learner's Permit
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When your teen is about to get his learner's permit, call your insurance company and ask about their rules for when a child needs to be added to the policy. Some require that all members of the family who operate the vehicle be listed on the policy, while others only require the child be added after getting a license to drive alone.
Driver's License
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Call your insurance company when your teen gets her driver's license and add the teen to the policy as a licensed driver. If you forget to do this and the teen gets in an accident, the company will still likely cover the damages if you have not renewed your policy since the teen's licensing, according to Insure.com. However, they may charge you premiums on the teen dating back to when the license was obtained. If you have renewed your policy since the teen obtained a driver's license, the insurance company may deny the claim because you misrepresented information by not listing the teen on the policy.
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Policy Review
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Insurance companies treat teen drivers differently. If your insurance company will require you to add the child upon entering driver's education and double your premium, you may want to consider shopping around. Another insurance company may calculate premiums differently or not charge you until the child is fully licensed.
Significance
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The timing of adding a teen to an insurance policy can have a huge financial impact. According to MSN, the average family sees a 50-percent increase in auto insurance premiums when adding a teen daughter to the policy and a 100-percent increase when adding a teenage son. If your teen does not need to drive yet and will not have a car of his own, it may make sense to wait a couple years before getting a driver's license.
Discounts
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Teens often qualify for discounts that can reduce the cost of insurance. For example, many insurance companies offer good student discounts for students on the honor roll or those with a "B" average or higher. If the teen will not be driving much, listing him as an occasional driver on the less expensive of the family vehicles can save money over having him as a primary driver on a brand new sports car.
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