It’s a day most parents endure with equal elements of relief and trepidation.
Fresno, CA -- (SBWIRE) -- 09/29/2014 -- Once a teenager finally obtains his or her driver’s license, mom and dad become refreshingly unshackled from the unrelenting cycle of drop offs and pick-ups, the latter of which tend to reach later into the evening hours the older one’s offspring become. This euphoria is, of course, tempered with the particular parental pattern of worry that’s an integral part of a freshly licensed driver’s vehicular forays into the unknown. Not to scare anyone in this situation, but car crashes remain the leading cause of death among Americans ages 15 to 19 according to the Centers for Disease Control and Prevention.
And then there’s one component of this rite of passage that can be particularly egregious to a family’s budget, namely the ensuing and often astronomical jump in auto insurance premiums.
Got one or more kids with learners’ permits in hand champing at the bit to finish their pre-license requirements in anticipation of a trip to the DMV? Are they sitting down? Adding a teen driver to a married couple’s auto insurance policy boosts rates by an average 79 percent according to a recent report conducted for the website InsuranceQuotes.com in San Francisco, CA.
Courtesy AAA Foundation for Traffic Safety.
Of course, as is typically the case with car insurance, gender matters here. Insuring a 16-year-old son will increase the insurance bill by a whopping average 92 percent, while adding a same-age daughter will result in a somewhat softer 67 percent surcharge. And that’s cheap compared to what a teen driver might pay if he or she were to obtain car coverage separate from the family’s plan. Of course the downside is that they’ll share the burden (not that it would be the first time) of their kid’s mistakes; any ensuing traffic accidents will likely jack up the family’s insurance rates even further and – worse – could expose the primary policyholder to lawsuits resulting from personal and/or property damage beyond the covered limits.
As if this is any consolation, the cost to insure a teen driver has actually dropped over the past year. In 2013, the average surcharge was 85 percent, according to InsuranceQuotes.com, with a typical 98 percent boost for newly licensed males and 73 percent for females. One reason for the decrease could be attributed to the concurring drop in licensed teen drivers. A study conducted by the University of Michigan Transportation Institute suggests that only around 60 percent of those between the ages of 17 and 19 are licensed to drive, compared to 80 percent of teens back in the 1980’s.
As we’ve shown in the past, location matters when it comes to determining auto insurance rates and premiums for teenage drivers are no exception. Policyholders in New Hampshire will see their annual premiums leap by a staggering average 111 percent when a teenager driver is added to a family’s plan. At the other end of the spectrum, residents of Hawaii – a state that prohibits both age and sex as criteria for determining rates – will see their auto insurance bills rise by an average of just 17%.
Here’s a breakdown of the 10 costliest states in the union for teenage drivers, based on their average premium increases:
New Hampshire – 111%
Rhode Island – 107%
Maine – 107%
Wyoming – 106%
Connecticut – 102%
Illinois – 101%
Oregon – 101%
Minnesota – 97%
West Virginia – 93%
Ohio – 93%
On the brighter side, here’s a list of the 10 states in which families will enjoy the lowest average surcharges for adding a teen driver to their policies:
Hawaii – 17%
New York – 53%
Michigan – 57%
Montana – 61%
New Mexico – 62%
North Carolina – 65%
South Dakota – 69%
Mississippi – 73%
Nevada – 74%
Wisconsin – 74%
Fortunately, insurance costs will gradually drop with each successive year a teen driver accumulates experience behind the wheel, provided of course he or she does not accrue any rate-busting moving violations or accidents in the meantime. According to InsuranceQuotes.com data, a teen driver’s premium surcharge will eventually fall to an average of 58 percent once he or she turns 19.
Also, there are a number of ways to help temper the financial sting of adding a young driver to the family policy. For starters, the usual panaceas apply, including shopping around for cheaper coverage, leveraging all available adult driver discounts and/or raising deductibles for collision and comprehensive coverage (but be sure to maintain a high threshold for liability to protect the family’s assets in case it’s needed). If they’re living in a crowded urban area, consider relocating the brood to a sleepy suburb where rates will inherently tend to be lower. Beyond that, insurance companies often give price breaks as high as 20 percent to kids who maintain good grades (a B average or better) and/or who take specified driver safety courses. Another way to help keep rates lower is to seek out a company that rewards safe driving habits – albeit intrusively – based on real-time assessments from an electronic monitor that plugs into a car’s onboard diagnostics port.
Finally, if they’re buying a teen driver his or her own car, choose one that’s inherently less costly to insure. Avoid anything that’s even the least bit flashy or sporty – crossovers/SUVs and minivans tend to deliver the lowest overall premiums – and choose a model that both gets stellar crash-test ratings and is equipped with a modicum of safety features, including antilock brakes, stability control and front/side-impact airbags.
The fine print: Rates for the above rankings were conducted by Quadrant Information Services based on rate calculations from the largest insurance carriers in each state. The averages are based on family coverage that includes a married and employed 45-year-old male and 45-year-old female having clean driving records and good credit who each drive 12,000 miles per year with policy limits of $100,000 for injury liability for one person, $300,000 for all injuries and a $500 deductible on collision and comprehensive coverage.
About Auto Insurance Bakersfield California
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