Your high schooler has been a taxi driver for several years. Now that she has her driver’s licence, she is borrowing your car. This leaves you in limbo. Perhaps it is time to get her a car. But what will this mean for your car insurance?
This is a scary prospect considering that the average annual cost for car insurance was $907 in 2014. According to ValuePenguin , Insuring teens is more costly — an average of $6,456 per year to insure a 18-year-old 2,. However, your teen might get a lower rate. You’ve already taken a significant amount of money if you insure your teen under your policy. In that case, you are simply taking on another vehicle and designating your teenager as the driver. These are some things you should consider:
Which type of car would you choose?
Although it is a subjective decision that has many variables, you might want to think about the impact on your car insurance rates. If your car is damaged in an accident, like a hybrid, you may be charged more. If you do decide to purchase a hybrid car, make sure you check for hybrid discounts. Check with your insurance company before purchasing a car. This will ensure that the vehicle you are considering isn’t too expensive to insure due to its reputation for being costly to repair.
Car insurance be used for?
Make sure you inform your insurer if the car will be used primarily for a commute to school or casual use. A discount may be available for cars that aren’t used frequently or logged with miles.
Have your car insurance policies been bundled?
Bundling is buying multiple types of insurance from one company. If you have the option, you can purchase your home and auto coverage from one insurer. Generally, that company will offer a discount on either one or both of your policies. It’s worth looking into pricing if you are adding a third vehicle to your existing policy.
Have other quotes been obtained?
In general, three cars insured through the same company are cheaper than having them split up. However, with a teenage driver that is not always possible, it’s possible. Review your coverage to ensure you get the best value.
Will your teen attend a class?
It may be possible to get a discount on your insurance if your driver takes a driver education or defensive driving course. You may be eligible for a larger discount if the entire house takes the defensive driving course. Ask your insurance agent what this might mean for you.
There are also student discounts that may be available.
There is so much competition between insurance providers that your family could benefit from enquiring about all possible options to find the best car insurance policy. Think about all the freedom that you will have once your teen stops borrowing your car.