How to Save Money on Teen Auto Insurance

No matter how much parents try to avoid it, there comes a time in their child’s life where they pass the Department of Motor Vehicle’s driving test and obtain a driver’s license. Shortly after obtaining the license, parents know the next step is getting the teen a car or allowing her to drive the family car and getting auto insurance to cover the new teen driver. There are things that parents and teens can do to save money on teen auto insurance.

Difficulty:

Moderate

Instructions

1. Ensure the teen maintains good grades. Insurance companies offer discounts to teenagers who maintain a B average or better in school. This auto insurance saving perk not only rewards the teen for his hard efforts in school, it also serves as a motivation for him to keep up the good work.

2. Take a safe driver course. In some states, its known as a Points and Insurance Saving Program (PISP), while other states refer to it as a Drivers Safety Course. Taking a state approved and insurance company approved safety course helps to save money on teen auto insurance rates.

3. Once the teen obtains a driver's license, she should do everything in her power to keep a clean driving record. Insurance companies frown upon and penalize new teen drivers that rack up driving violations. Parents must stress the importance of maintaining a violation-free driving record.

4. Purchase a safe car. A safe car goes beyond those equipped with anti-lock brakes and vehicle traction control. It also means one that is not at risk for vehicle turn over, theft or vandalism. A quick look at MSN’s most stolen car list can help the parent and teen avoid purchasing a highly targeted car. After all, insurance companies consider insuring a teenager a higher risk than insuring a seasoned driver. It’s best not to add to the risk factor by purchasing a car that statistics show is at high risk for theft or other insurable loss.

5. Have a talk with the insurance agent. Applying for auto insurance online is fine, but a face-to-face or telephone conversation with an insurance agent can better help to save money on teen insurance rates than impersonal application online. Insurance agents are aware of infrequently offered insurance company discounts. By opening a dialogue with an insurance agent, one can ask more about the underwriting process and maybe divulge information that will encourage the insurance agent to offer additional money saving auto insurance discounts.

6. Shop around. Always get two or more insurance quotes before choosing an auto insurance policy.

Tips & Warnings

• Before taking a safety-driving course, make sure the school offering the course is both state and insurance company approved.

Resources

• Point and Insurance Saving Program
• MSN - America's Most Stolen Cars