Got Teens?

Lets talk about your auto insurance.  If you have a recently licensed teen driver or have one that is will be licensed in the future I hope you read on.  Adding a teen driver can be quite stressful.  Let me walk you thru the process of what you need to do to be prepared. 

To start, once your teen receives his/her driving permit he or she is automatically covered on your auto policy.  You can inform your insurance company of this event but you actually dont add your teen to your policy until they receive their drivers license.  During the permit phase, your teen has the same coverage you have on your policy as long as he/she is driving with you.  Your teen is not allowed to drive solo so should they decide to take the family car for a joy ride your policy will not cover you.

Now, during the permit phase I suggest you have a serious conversation with your child.  Just because the state allows a 16 year old to get a license doesn't mean they are ready for the responsibility.  In Illinois, a teen cannot get their initial license without a parent or legal guardian present.  We all know that most teens really want to drive so now you have some leverage you can use to your advantage.  Personally, I recommend that unless your teen can produce grades of a B average or better you should delay in letting them get their license.  Why a B or better?  Because all major insurance companies offer good student discounts which typically are about a 15% savings on the teen's portion of your premium. 

Adding a teen does increase your cost so having your child have some skin in the game in terms of demonstrating responsibility and reducing your auto premium is a good thing.  In addition, there are programs which will further reduce your teens insurance premium.  We subscribe to a program called TeenSmart as do many other insurance companies.  This program will further reduce your teens portion of your auto insurance another 15%. You can learn more about TeenSmart at the following link http://www.adeptdriver.com/.  

You may be surprised to know but over 60% of teens get into an accident in their first year of driving.  The odds are not good for teen drivers so working together and utilizing programs like TeenSmart will not only save you money but more importantly reduce the odds that your son/daughter will be involved in an accident. 

In 2008, Illinois introduced new laws which restrict how newly licensed drivers can drive.  You will want to pay close attention to these new laws as should your teen break any of these laws, their license will be suspended and your auto rates will skyrocket.  To help parents understand these changes I created the driving log at the end of this blog.  I suggest each new driver fill out the log prior to driving to reinforce good driving habits.  Did you know that if your teen is caught talking on a cell phone while driving its an automatic 90 day license suspension?  I suggest that all teens turn off the phone prior to driving and use the log to reinforce this behavior.  There are other things teens may do that will lead to a license suspension so it's a good idea to understand these laws and the impact they have on your teen and you. 

So what is the best thing you can do to help mitigate the increased cost on your auto insurance when adding a teen?  First make sure your teen has good grades (B) prior to getting a license.  Second, have your teen complete a safe driving course like TeenSmart which will further reduce your auto insurance and reduce the probability he/she will get into an accident.

Third..... Buy your auto insurance from me..... When I sell auto insurance to families with teen drivers I make sure you are on a plan that has a feature called "accident forgiveness".  It costs a little more up front but can save you big dollars down the road.  My policy will allow your family to have three at fault accidents a year and not see a rate increase due to the accidents.  Without this feature you can expect a jump near 40% if your teen has an accident for all of the autos you insure.... 

Teen drivers are the highest risk group that we have as insurers so with a little planning and work with your teen you can make the transition to safely add your teen and prepare for the future.   That's all I have to say about that...