Adding a new teen driver to your auto insurance policy may come as a bit of a surprise, but it’s crucial to protecting your family’s finances. Fortunately, there are a couple of things you can do to help with the jump to premium. Here’s everything you need to know about adding a newly licensed driver in your household to your auto insurance policy.
Do I have to add my child to my car insurance?
If your child has a driver’s license, lives at home, and drives a car that’s registered to your home, you’ll need to add it to your auto insurance policy. This will be the case regardless of her age, as anyone living in her household with access to her cars will need to be a driver listed on her auto insurance.
However, if your child has their driver’s license but doesn’t plan to drive in the foreseeable future, you can choose to formally exclude them from your auto insurance policy. You may need to sign a form with her insurance company to confirm that your son will not be driving any of her cars. If they get behind the well and have an accident, your car insurance company won’t cover the damage. Once you and your child decide that you will return to driving, you can contact your insurance company to list your child as a driver on your policy again.
benefits of adding your child to your car insurance policy
While you’ll likely see a premium increase when you add your child to your policy, there are also benefits. Some common advantages of adding your child as a driver on your car insurance policy are:
- Lower premiums for your child: If your teen is 18 or older, you may be able to purchase a policy in their own name (assuming they own, lease, or finance their own car) . however, car insurance for 18-year-olds alone is usually quite expensive. If your teen lives with you and his name is also on your vehicle, he’ll likely save money by staying on your policy.
- qualify for new discounts: There are many car insurance discounts available for teen drivers. you may be able to offset some of the cost of adding your teen driver by taking advantage of good student discounts, distant student discounts, and teen driving programs.
- Simplified policy management: Having your entire household under one policy could make it easier for you to make changes, pay bills, and keep track of your insurance documents.
- Getting coverage for your teen: Adding your teen driver helps provide coverage if an accident occurs. If your child is not listed as a driver on your policy, but still regularly drives one of your vehicles, coverage could be denied after an accident.
- that the unlisted operator be added to the policy.
- proof that the unlisted carrier is insured elsewhere.
- proof that the unregistered operator resides elsewhere.
- are married or have children of their own.
- they are the only owners of the vehicle who drive and do not live in their household.
- are financially independent.
Also, adding your teen to your auto insurance policy could present a learning opportunity. You could teach your child about car insurance, why it’s an important purchase, and how to pay bills.
costs of adding a young driver to your car insurance
Adding a teen driver to your auto insurance policy will likely increase your rate. A recent Bankrate study of cheap teen car insurance found that 16-year-old drivers faced some of the most expensive car insurance premiums of any age group. when added to their parent’s policy, the overall premium cost increased by between $2,000 and $2,300 per year for a full-coverage policy, on average.
Some of the higher cost to insure teen drivers is attributed to their lack of driving experience, but other factors may be at play as well. In most cases, teens don’t have a credit history or credit score, which is used in some states to determine car insurance rates. they also cannot get discounts like loyalty, bundles, or multi-vehicle discounts. however, teens can access special discounts on student auto insurance to help offset some of the premium increase.
when do you add your teen or young adult to your auto insurance?
Generally, you should add your teen or young adult to your policy as soon as they get their driver’s license. however, to be safe, you may want to contact your insurance provider before your child starts driving.
Some states, like Florida, provide insurance companies with “risk alert” reports. These reports tell them about any licensed operators that have the insured’s address on their driver’s license. After receiving risk alert reports, insurers typically contact policyholders and request one of the following:
Official documents, such as a utility bill, lease, or deed, are typically the types of official documents that are accepted as proof of residency. lack of proof that the unlisted carrier is insured elsewhere or resides elsewhere requires it to be added to the policy. furthermore, failure to provide adequate information to allow the unlisted operator to be added to the policy could lead to mid-term cancellation or non-renewal of the auto policy.
when should your adult son or daughter get their own auto insurance policy?
There is no age requirement for your child to have their own policy. As long as they still live with you and you have an insurable interest in the vehicle they drive, there is no set age at which you must remove them from your auto insurance policy. however, if any of the following factors apply, it may be time for your child to have their own policy.
If none of the above factors are still in play, many insurance experts recommend keeping your teen or young adult on your policy.