It goes without saying that Auto Insurance Clovis premium rates are considerably higher for teen drivers. The primary reason for this is their classification as a high risk driver. This is unfortunate because they are already negatively labeled before they have ever had a chance to prove themselves as being roadworthy drivers. This is really unfair when you consider the fact that the high risk driver category includes individuals who: • Are not homeowners • Do not have a good insurance credit score • Have multiple traffic violations • Were convicted of DUI’s and DWI’s The terminology “high risk” can be applied in a number of ways. For instance, it could refer to those drivers that are higher risks to insure than other drivers. It is also used to refer to drivers who are ineligible for purchasing auto insurance through a preferred provider. But in reality, teenage drivers lack the driving experience that other drivers have and are more prone to being involved in an accident. One way or the other, having a teenage driver in the family could hike the cost of your premiums anywhere from 50% up to 100%. Why is Credit Score Important? As a teenager, having no credit history can be just as costly as having a poor credit history, especially when you are shopping for auto insurance. Although you wouldn’t think that credit scores would impact the cost of insurance premiums, they do. This based on the fact that numerous research studies conducted by insurance companies that there is a strong correlation between insurance claims and a person’s credit score. So as a teenager with little or no credit established, you are automatically categorized as being a higher risk. Helpful Tips for Reducing Your Premium Rates Just because you are already expecting to pay higher premium rates for your teen driver, it doesn’t mean that you can’t offset those costs as much as possible. The following are some helpful tips for reducing your teenager’s share of your insurance premium costs: Encourage your teen to get good grades and maintain them. Your insurance company most likely offers what is called a “good student” discount. The discount is usually available to teenage drivers who: • Are included on the Dean’s List or the honor roll • Be ranked in the top 20% on anyone of the six standardized tests • Maintain a “B” average or higher in their classes Have your teen enroll in a driver’s education class. Some states make this a requirement for high school students already, but not all of them do. However, if your teen enrolls in a driver’s education class, your insurance company may offer you a discount on your premium rates. They should also consider taking a driver training course to further lower the premium rate you are paying. If your teen has a vehicle that they use 100% of the time, you are going to pay a higher rate for insurance coverage. It’s better to hold off purchasing a vehicle for them and just let them drive one of your existing vehicles part-time. Additionally, when they go off to college, your rates will decrease if they go more than 100 miles away to attend school. Increase the amount of your deductible on your current policy. This will help lower your premium rates overall, provided you are smart about this and set aside the amount that is required to pay should you or your teen be involved in an accident. When you eventually purchase your teen their own vehicle, consider getting them an older model. Granted, your teen will most likely prefer the hottest model on the road. However, the bottom line is that purchasing an older make and model will save you money in the long run. Besides that, it will most likely be your money that is invested in a car and not theirs. Closing Thoughts Today’s modern technologies have made it much easier for a parent to track their child’s or children’s whereabouts. A number of insurance companies now provide electronic devices that enable you to monitory teens driving habits. So you should inquire with your current company to see if they offer these. There may be a slight cost involved, but in the long run, it will be worth the savings you incur. CAI offers every type of insurance service you could need. Call us today at 559-326-0700 or stop in to speak to one of our friendly insurance agents.
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