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Article 1 of 7 in Liability Coverage |
Car insurance for the young driver with a learner’s permit or provisional license |
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Insurance companies will cover young drivers with learner’s permits and provisional licenses, but your costs of doing so may be high because of the risk. In fact, many policyholders report that their rates increased by 200% when adding a young driver to their policy! But don’t despair; there are ways to cut your costs, such as:
- Having the young driver complete a driver’s education course. Insurers may reduce the young driver’s rates by 15%.
- Having them keep their grades up. Probably easier said than done, but young drivers with good grades can reduce premiums up to 25%.
- Finding out how your insurer assigns drivers to vehicles. Many insurers automatically assign the highest risk driver (in this case, the young driver) to the most expensive vehicle – even if the young driver never gets into that vehicle. If that’s your insurer’s policy, your rates may skyrocket. What to do? Switch insurers!
- Increasing deductibles. Higher deductibles generally mean lower rates. You’ll assume additional risk, but if your young driver is careful, it may be worth it.
- Driving older cars. Older cars may not need comprehensive or collision coverage. Eliminating or reducing these may save you big money in premium costs.
- Reducing liability amounts. This is certainly an option that may save you money, but it might not be worth the risk. Even if your young driver has the best intentions and is very careful, it is important to realize that he or she is still learning Reducing liability amounts could mean disaster – especially if you have other assets, such as a home or business. A serious accident could put those assets at risk if damages exceed your liability amounts.
State law requirements. Most states have laws that restrict young drivers who are driving on a learner’s permit or provisional license. These restrictions are generally based upon age, how long the driver has had their permit or license, minimum amounts of supervised driving, passenger rules and limited hours of driving.
For more information about how rates are determined, go to the Free Advice Auto Insurance Center [Brandon: Click on Free Advice Auto Insurance Center and link to ]. For information about insurance law, check out the Free Advice Insurance Law FAQs.
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