Your child turning 16 is a big milestone. But while you’ve spent time researching the safest cars and how to help them pass their driver’s test, you’ll also need to update your car insurance.
Because they’re newer drivers and statistically more likely to be in accidents, teenage drivers are the single most expensive demographic to insure.
Adding a teen to a family policy with two adults can cause premiums to shoot up 150%, according to the Insurance Information Institute. A teen with their own policy can expect to pay double or even triple what their share would be on a family policy.
Thankfully, there are still some ways to save on auto insurance with a young driver in the family.
1. Add them to your policy
Having a teen driver on their own insurance policy is significantly more expensive than adding them to yours.
In comparison, a policy with two adult drivers and an 18-year-old girl averages just over $5,500. With an 18-year-old boy on your policy, the average is just under $6,000.
2. Shop around for better rates
Once you add a teen, the policy you’ve had for years might not be the cheapest anymore. Insurers consider risk differently, so one may charge more for a young driver than another.
With affordable rates and generous student discounts, Travelers and Geico are two of our top picks for teen car insurance.
Travelers Auto Insurance
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Cost
The best way to estimate your costs is to request a quote
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App available
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Policy highlights
Travelers auto insurance policies are affordable and backed by the sixth largest company for car insurance by market share according to the NAIC. The company also offers a number of discounts to customers, including discounts for bundling, owning a hybrid or electric car, and good student discounts.
Geico Auto Insurance
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Policy highlights
Geico offers 16 discounts and a variety of optional add-ons, such as emergency roadside assistance, rental car reimbursement and mechanical breakdown insurance.
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Availability
Geico auto insurance is available in all 50 U.S. states and Washington, D.C.
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Accident forgiveness
Accident forgiveness is automatic if you remain accident-free for five years. It can also be bought as an upgrade when you buy or renew your policy.
Terms apply.
3. Bundle your car and home policies
Keeping all of your policies with the same insurer makes it easier to manage, but it can also score you a hefty bundling discount, with or without a teen driver.
Amica Auto Insurance
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Cost
The best way to estimate your costs is to request a quote
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Policy highlights
Amica offers a variety of auto insurance policies to fit your coverage needs. The company also offers a total of 18 discounts, including discounts for bundling and for students.
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App available
4. Keep an eye on their grades
Your child’s good grades can pay off with lower car insurance premiums: Providers like Geico, Auto-Owners and Progressive have generous good-student discounts for high school or college students with a B average or better. At up to 25%, State Farm’s is the biggest we’ve seen.
State Farm Auto Insurance
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Cost
The best way to estimate your costs is to request a quote
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App available
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Policy highlights
State Farm is one of the largest auto insurers in the U.S. based on market share. It has an excellent reputation for customer satisfaction and offers discounts for safe driving and young drivers.
There are other ways to save, too: Many insurance companies offer discounts for young drivers who complete an approved defensive driving course or leave their car behind when they go off to college.
If your child has joined a fraternity, sorority, or honor society, they may qualify for an affiliation discount, and students in the armed forces are eligible for military discounts. A number of colleges and alumni associations negotiate their own discounts, as well.
5. Monitor their driving
State Farm Auto Insurance
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Cost
The best way to estimate your costs is to request a quote
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App available
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Policy highlights
State Farm is one of the largest auto insurers in the U.S. based on market share. It has an excellent reputation for customer satisfaction and offers discounts for safe driving and young drivers.
State Farm’s Steer Clear program is designed for drivers under 25 with no at-fault accidents or moving violations in the past three years. In addition to completing lessons, watching videos and taking quizzes, participants clock five hours on the road to receive an in-app certificate of completion and a discount of up to 15%.
The company’s Drive Safe and Save program, another telematics-based offering, collects driving data on acceleration, braking and cornering to help drivers earn a discount of up to 30%.
6. Give them an older car
Because they’re worth more and their parts and technology are more expensive to repair or replace, new cars cost more to insure. Used cars have a lower resale value and parts that are cheaper to replace, so they’re usually cheaper to insure.
If you own the car outright and it’s not worth ten times your annual premiums, you might even consider dropping collision and comprehensive insurance and just keeping a liability policy, which can be a third of the cost of full coverage.
Don’t give them a clunker, though: Many top insurers have discounts for anti-lock brakes, anti-theft devices and passive restraints.
7. Buy an umbrella policy
Nobody wants to think about it, but without years of experience behind the wheel, a teen is more likely to cause a serious accident. If the damages or injuries are beyond your liability limits, you could be on the hook for thousands or even hundreds of thousands of dollars.
American Family Umbrella Insurance
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Cost
The best way to estimate your costs is to request a quote
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Maximum coverage
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App available
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Policy highlights
American Family has a wide variety of umbrella policies available, including personal coverage, commercial coverage and coverage for ranches and farms. It’s also highly rated for auto and home insurance.
Pros
- Wide variety of coverage options available.
Cons
- Not available in all 50 states.
Car insurance FAQs
What is the cheapest car insurance for a teen driver?
We found that Travelers is the cheapest car insurance company for teen drivers. Prices vary by gender, age, location, make, model and other factors, so get several quotes and compare them to find the best price.
Do I have to put my teenager on my car insurance?
All licensed drivers in a household should be listed on the primary policy to ensure sufficient coverage. If your child is of driving age and lives with you but doesn’t have a driver’s license, your insurance company may require you to list them as an excluded driver and they won’t be covered by your policy.
At what age do car insurance rates go down?
Car insurance rates fall as drivers get more experience behind the wheel. Premiums are the highest for 16 to 18-year-olds and tend to decline at 21 and 25. The rates you pay will also be affected by other factors, like their driving record, grades and whether they still live at home.
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Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.
Clinton Mora is a reporter for Trending Insurance News. He has previously worked for the Forbes. As a contributor to Trending Insurance News, Clinton covers emerging a wide range of property and casualty insurance related stories.