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The Ins and Outs of Teen Auto Coverage

They grow up so fast, and you probably never thought you’d have to worry about it, but the time has come. Today, nearly 60% of teens get their licenses before they turn 18. If yours is finally joining the club, there’s a lot you may worry about.

Fortunately, we can help take one burden off your mind by helping you find the right auto insurance for your teen driver. Here’s what you need to know about teen auto insurance policies!

How Much Does Teen Auto Insurance Cost?

Adding a teen to your policy can be quite expensive. While it varies in every state, the average cost of a policy with a teen can more than double the cost of a policy without a teen. The average price in Pennsylvania is $1,212 without a teen, but $2,533 with a teen, which is a 118% increase.

While that may sound bad, in other states including South Carolina, Nevada, California, and Arizona, it’s more than triple the cost.

Consequently, it’s essential that parents and teens work to find the right insurance plan. This plan needs to cover the needs of the driver, meet the state requirements, and of course, not break the bank. Let’s talk about that.

What Coverage Do Teens Need?

Most states have unique laws regarding minimum coverage, so it depends on where you live. Here in Pennsylvania, the minimum requirements for your coverage include:

  • $15,000 per-person bodily injury coverage
  • $30,000 per accident bodily injury coverage
  • $5,000 property damage liability coverage
  • $5,000 medical first-party benefits

While this may not sound like much for just yourself, the costs of insuring a younger driver are typically much higher. Also, just because it’s the minimum doesn’t mean you should stop there.

We always recommend higher limits of coverage, so you are properly insuring against loss, regardless of state requirements or minimums. Personal injury, property damage, uninsured motorist, and comprehensive costs can add up dramatically when you’re forced to pay out of pocket if you are not properly insured.

While personal injury coverage is required, we recommend going above the state minimum. Medical bills tend to be the most expensive aspect of a car accident when they are needed. Extra protection could literally save your financial future.

For additional coverage, we recommend adding collision insurance with a reasonable deductible. This coverage pays for repairs to your vehicle in the event your vehicle is in a collision.  It’s better to be safe than sorry, as an accident can cost thousands of dollars out of pocket without collision coverage.  As of January, 2023, a new vehicle cost buyers an average of $49,388.00.

We also strongly recommend comprehensive insurance, especially for newer vehicles. This coverage covers repairs to a covered, non-collision claim.  The less you or your teen need to pay out of pocket, the better. A steady, predictable insurance premium is much better than infrequent and large bills in the event you find yourself underinsured and on the hook for repair bills after an accident.

Again, costs can be pretty high for new drivers. So, let’s talk about some ways you can save money on your new policy.

Saving Money on Teen Auto Insurance

The best way to save money on your teen’s auto insurance is to add them as a driver onto your existing insurance plan. If your teen doesn’t have a car of their own, then this is all you will need to fully cover them, assuming your plan meets the state minimum requirements.  Companies such as Erie Insurance require newly licensed drivers to be added to mom and dad’s policy the day they are licensed if they do not have their own policy when they pass their license test.  Many times, since newly licensed drivers don’t own their own vehicles, this is the only place for young drivers to be placed when first licensed.

Teens pay higher rates for insurance due to their inexperience with driving a motor vehicle.  Enrolling your teen in an authorized driver’s education class is a great way to demonstrate your teen’s commitment to responsibility to your insurance company.  This will help you save money and hopefully create safe driving habits for your young driver.  Check with your insurance agent today to see if your young driver qualifies for any savings through driver’s education.

Another area of possible savings are company’s “safe driving habit” apps, available on most smart phones today.  One example is Erie’s YourTurn app, which monitors driving habits, and can incentivize safe driving.  While the YourTurn app is available to all drivers, young drivers have the ability to earn double the rewards, thus incentivizing safer driving and promoting the development of safe driving habits in younger drivers.

Lastly, avoid expensive cars for your teen. Nobody needs a new Tesla for their first car, and if you feel they do you should prepare to pay the premium for this luxury.  Driving vehicles currently on your insurance plan, to start, will save you the most money when adding a new driver. Otherwise, get a reasonable, safe, and affordable used vehicle to help save money.

How to Add a Teen Driver to Your Policy

Adding a driver to your policy is easier than ever. You can simply contact your insurance provider and give them information about your young driver when they get their license. Depending on your provider, this can often be accomplished with a simple phone call.

To do this, you will need your teen’s driver’s license or permit number, as well as their personal information like their date of birth. If you add a new vehicle to the policy, you will need to know who the primary driver of the vehicle will be, the VIN, and other information about the vehicle before adding to the policy.

Adding a new driver to your policy is a great reason to review your current coverages with your insurance agent, and it’s also in your best financial interest to make sure your teen driver is properly insured.  Typically, insurance company’s charge higher rates for teen drivers, so it’s always good to get a quote from different companies to see where you currently stand and to review your current policy to find any additional areas of possible savings.

From there, make sure you review the coverage on the plan to ensure that it meets your standards, not just the state requirements. Remember, there’s precious cargo on board!


Get Covered Today

Now that you know some of the important details of teen auto insurance, enroll in the right policy today for the best results. Remember, insuring your teen doesn’t have to mean breaking the bank if you do your due diligence. Compare different quotes and their coverages and choose a policy that works best for you and your family.

Stay up to date with our latest tips for drivers and their parents, and don’t hesitate to contact us with any questions or for help finding the right coverage for your needs!