Having a teenager start driving can be nerve-wracking in more ways than one. In addition to worrying about something happening to them, the car insurance rate increase to add a teenaged driver to your policy can put a strain on your budget. Plan ahead to help everything go smoothly.
Why Do Auto Insurance Companies Charge So Much More For Teenagers?
Teenagers are both less experienced and more likely to take risks than more mature drivers. That leads to them getting into more accidents. It also leads to the car insurance companies having to pay out more claims. That, in turn, means insurers have to charge more for teenagers.
When Do You Need To Add Your Teenager To Your Car Insurance Policy?
When you need to add your teenager to your car insurance policy depends on your state and insurance company. Many car insurance companies cover anyone driving your car. So, you may still be insured even without adding them to your policy. State laws requiring drivers to carry insurance vary on whether the parents having their car covered counts. This also varies based on whether the teenager has a permit or is fully licensed.
What Happens If You Don't Add Your Teenager To Your Car Insurance Policy?
In addition to the possibility of not being insured, there are a few things that can happen if you don't add your teenager to your auto insurance policy. First, your insurance company may decide to not renew your policy if you don't add all drivers in your household. Second, your insurance company may require you to exclude your teenage driver to maintain coverage — this would mean that they and you would have no coverage when they're driving your car, even if they otherwise would have.
What About When Your Teenager Buys A Car?
When your teenager buys a car, you will need to add that car to your insurance policy, with your teenager listed as its primary driver. If you want your teenager to pay all or part of the cost, you can ask your insurance agent to break down the total premium for you.
It's possible for your teenager to buy a separate policy, but the insurance companies may require you to exclude each other. Your teenager would not be covered when driving your car, nor would you be covered when driving theirs. The cost is also usually higher.