According to the Center for Disease Control and Prevention (CDC), teen drivers ages 16 to 19 are nearly three times more likely than drivers aged 20 and older to be in a fatal crash. The risky behavior teenagers exhibit leads to more accidents among their demographic, resulting in higher auto insurance rates that parents pay once teens are on their policy.
Familiarize yourself with your insurance policies.
Before a teenager receives his or her learner’s permit, understand how you’ll be insured by different policies in the event of an accident. As long as damages from an accident are due to negligent rather than criminal charges, auto insurance covers up to the limits of liability insurance you purchased. Homeowners insurance kicks in if an accident affects your property, such as accelerating a car into the garage.
Because of the high risk of teenage drivers, consider purchasing an umbrella liability policy, which allows you to add $1 million or more to your auto and homeowners coverage. If your teenage driver causes an accident, as the parent and owner of the policy, you’re responsible for costs that exceed the limits of your policies, so umbrella insurance could certainly come in handy.
Notify your insurance company that your teen is driving.
Don’t make the costly mistake of failing to inform your insurance company that there’s a new driver in the family. Instead, notify the company as soon as your teen gets behind the wheel with a learner’s permit. If your teen is uninsured and gets into an accident, the company might refuse to cover all damages.
Research ways to drive down costs. There’s no escaping the fact that teenagers are the most expensive drivers to insure, but there are cost-saving strategies. To start, add your teen to your own insurance policy instead of getting them their own, and make sure your current policy is still the best option for your family. Take advantage of deals companies’ offer, such as reduced rates for students who receive good grades or discounts for installing electronic monitoring devices in their car.
Emphasize safe driving habits to your teen. Discuss responsible driving habits with your teen. Distracted driving plays a huge role in the number of accidents on the roads. Texting or talking on the phone, looking up directions, and talking to other passengers are a few of the leading causes for minor and major collisions. Handheld cell phone use is the highest among teenage drivers, which factors into the pricing platform the insurance industry sets for policies for teenagers.
Explain the legal implications they assume when they get behind the wheel. Even though they’re less experienced and skilled than other drivers, they have a duty to drive safely. The legal concept of negligence is a key factor in determining fault in a collision, so if they make reckless decisions, both you and your child are often legally liable for resulting damages.
You can’t always avoid the unavoidable, but as a parent, it is critical to stress to your teenager the importance of responsible driving. Also, don’t forget to protect yourself financially by obtaining proper auto, homeowners, and possibly umbrella insurance for teen drivers. Reach out to your HUB broker today to make sure you have the right coverage.