Teenage Drivers?

What fond memories we have of turning 16… Taking our drivers test, buying a car, driving to school for the first time, or picking up your friends for the first time, many exciting things happen around that age(or at least from the child’s perspective!).  For parents it opens the door for many new worries and anxieties, including “how much is this going to cost me?”  Adding a teenage driver to your insurance policy is very expensive, I will try to help you understand why, as well as give you some pointers to help lessen that, and explain the importance of having them on your policy instead of on their own.

Teenagers are risky, we all know it.  At 16 years old the human brain is not finished developing nor is it common that a 16 year old brain has reached its full capacity for decision making.  The biggest issue insurance companies have with teenage drivers is simply lack of experience.  It is very common that an accident that you or I would easily avoid safely, can cause an inexperienced driver to panic and overreact.  Add on top of that the numerous distractions they have from stereos and smart phones to friends in the car with them.  Aside from smart phones there are other risks associated with younger drivers that may not have been an issue in years past such as the time constraints placed on teenagers these days.  Teenagers today are under more pressure than ever to play sports and practice, study for SATs, figure out where to go to college, all on top of much harder curriculum which requires much more time studying at home.  These factors all lead to the second biggest risk which is speed.

Now, if you are looking to save as much money as possibly when you add your child there are several things that will help significantly!  #1 Be a Good Student, most insurance companies offer sizeable discounts to those underage drivers who can maintain a 80 or above average, some as much as 15%.  #2 Driver Training!  In the state of Georgia you are now required to take a drivers training course to get your license, and some insurance companies still offer a discount for it.  However, there are other programs including an offensive drivers course that can help get some additional discounts.  #3 Choose the right car! If you put your child in a new high performance sports car, you will pay heavily for it.  The best option for saving money is to buy a cheaper car that you do not need comprehensive and collision coverage on, these two coverage is where the bulk of the premium will go.  In the end it is not just the discounts you get on the front end.  The best thing you can do is get them as experienced as possible, and make sure they are aware of the dangers of driving and the importance of paying attention.  When they have the learners permit take them every day to drive, put them in situations that they will experience and get them used to ignoring distractions and issues that can arise.   This may not save you money the day you add them to your policy, but if it helps avoid a ticket or an accident it will be worth more than any discount, let alone if it saved them from injury!

The last topic I want to discuss is a very common mistake that parents make.  Even Clark Howard gets this wrong!  There are certain situations where it is cheaper to put your child on a policy by themselves.  The problem is that while it might save you money it opens you  and your family up to a very large amount of risk!  The problem lies in Georgia State statute that if they can prove that you are supporting your child in anyway, they will name you in the lawsuit.  Your child’s insurance will pay first, but in the case of a serious injury or death it will not be enough coverage.  Your insurance will not protect you because your child was not a listed driver and the vehicle was not insured on your policy so they have no duty to defend you.  Even if the judge and jury determine that you should not have to pay anything(very rare cases), you will be responsible for all of your legal fees which as you can imagine can get very high especially involving death or serious injury.

Please remember the purpose of Insurance.  It is not for you to fix your car when you have a fender bender, it was designed to protect you against catastrophic losses that could ruin you financially.  Think about it; as bad as it would be to get a $30,000 car stolen from you, wouldn’t it be much worse if you seriously injured someone and had a judgement against you for $1,000,000?

The safest option is to do it the right way, when it comes to insurance it usually does not pay to try and skimp on coverage.  The amount of liability you buy is not the most the other person can collect, it is simply the most your insurance company will pay on your behalf!  If you carry 25/50/25 and you seriously injure or kill someone, you will get a judgement against you, and if you do not have anything worth taking, they can garnish your wages fro the rest of your life!

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