There's no doubt about it. Car insurance for teenage drivers is expensive! New drivers are 5 times more likely to have an accident. The good news is there are ways to lower your cost without sacrificing coverage. The biggest mistake I see parents make is reducing coverage when they add their son or daughter. If your child has an accident the parents will be sued, not the child.
If you are going buy a car for your child buy an older vehicle and stay away from sport cars. A Mustang GT is not a good option for lowering your cost. If you are not going to buy a vehicle and have more drivers than cars, then you can list your child as an "occasional driver". Most companies also offer Good Student Discounts and a discount for completing driver's education so make sure you inquire about both of these for additional savings.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
This is a very complicated subject. In California all the drivers in a household are included on an auto policy. Parents don’t want the additional expense of insuring their cars with an inexperienced driver in the household. Some purchase a car and place the car in the 18 year old’s name. They then buy the cheapest auto insurance with just the bare legal limits. The problem arises when the inexperienced driver injures others in an accident and the injured party starts suing. The lawyers will not stop at the limits of the policy purchased for the 18 year old. I have seen them even go after grandparents who loaned money to the 18 year old. Your only recourse is the low limit policy purchased for the car. The rest of the lawsuit comes after everything that you own. It is usually cheaper to include the inexperienced driver on the family policy. If you add another car you can isolate the expense to that car but at least you can have the advantages of discounts and perhaps save yourself from bankruptcy down the road.
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Cheap car insurance rates for an 18 year-old are sometimes possible.
As an experienced broker with 33 years of experience, our job is to find the lowest rates offered by the most reputable carriers. But the coverage you have on the vehicle is critical. While low liability limits and high deductibles may result in affordable prices, it is important to understand what the "sweet spot" is when picking the right policy.
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If you are going buy a car for your child buy an older vehicle and stay away from sport cars. A Mustang GT is not a good option for lowering your cost. If you are not going to buy a vehicle and have more drivers than cars, then you can list your child as an "occasional driver". Most companies also offer Good Student Discounts and a discount for completing driver's education so make sure you inquire about both of these for additional savings.
As an experienced broker with 33 years of experience, our job is to find the lowest rates offered by the most reputable carriers. But the coverage you have on the vehicle is critical. While low liability limits and high deductibles may result in affordable prices, it is important to understand what the "sweet spot" is when picking the right policy.