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Insuring Your Teen without Breaking the Bank

This is a guest post from Lauren McClure, writer at I DRIVE SAFELY, the nation's leading provider of approved defensive driving and teen Driver’s Ed courses. For over 10 years, I DRIVE SAFELY has led the way toward giving teens and adults the tools they need to stay safe on the roads. For more information on our self-paced, flexible teen Driver’s Ed course, please visit

It’s a familiar formula: when a teen starts driving, the family’s insurance rate skyrockets. Insurance companies see new teen drivers as a greater risk of liability, and with good reason—according to the Insurance Institute of Highway Safety (IIHS), teens are 3 times more likely to get into a car accident than drivers over 20 years of age. Similarly, the leading cause of death for drivers between 13 and 19 is motor vehicle accidents, and the majority of these occur within the first few months of the teen receiving his or her new license.

While any parent’s first and foremost major concern is the safety and well-being of their child, they understandably will also be concerned about the impact that their newly driving teen will have on their wallet. But there are ways for parents to keep their insurance rates from rising by a huge amount, and possibly even earn a discount in time!

Get Them Started with a Good Education

Before you even consider handing over the keys to your teen, it’s important to ensure that they have the proper set of tools and skills they’ll need to handle the responsibility of driving a set of wheels. You should be absolutely vigilant about enrolling your teen in a state-approved Driver’s Ed program. These courses not only teach the basics of traffic laws, road signs, and traffic signals, but also deal quite closely with common driving hazards and defensive driving techniques, along with the dangers of drugs and alcohol.

While most states include some level of driver education as part of the driver’s licensing process, teens can also elect to take a course voluntarily. A supplemental driver education or traffic school course will go into deeper detail regarding safe-driving techniques. Many insurance companies encourage new drivers to take an additional driving safety course like this as it will increase a young driver’s knowledge and confidence behind the wheel. In turn, they will reward the teen’s efforts with lower insurance rates.

Expensive Cars = Expensive Insurance

If your teen is going to be driving their own car (as opposed to the family vehicle), make sure to keep them in a car that is relatively inexpensive to insure. Sports cars and luxury vehicles are notorious for hiking insurance rates by leaps and bounds. After all, sports cars go faster and are therefore considered higher safety risks… and luxury vehicles cost more to produce and therefore more to repair in the event of an accident. By placing your teen in a safe, reliable, and modestly-priced vehicle, you won’t incur extra charges for flashy (and unnecessary) extras.

Add Your Teen to Your Own Policy

Instead of getting your teen their own insurance policy, it’s wise to add them to your existing one. Most insurers have discounts for multi-car policies; plus, a teen distinguished by themselves on their own policy is a greater liability risk than if the teen is simply added as another driver on an existing adult’s policy. If you own multiple vehicles, ask your insurance company if you can assign your teen to a specific car instead of assuming that all drivers will operate all vehicles. If this is possible, you should then assign your teen to the safest and least expensive vehicle to insure.

Good Grades Earn Lower Rates

Many insurance providers will reward new teen drivers who consistently earn high marks on their school report cars. This is because teens who show dedication and responsibility in the classroom are far more likely to exhibit the same behaviors behind the wheel. Make sure your child keeps up their performance at school—it will not only get them far in their education, but it can also help to keep your hard-earned money in your pocket.

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