Car Insurance for Teenagers. Graduated Licenses Can Help Lower Teen Insurance Costs.


Your 16 year-old novice driver may be the most cautious, thoughtful, law-abiding kid on the planet, but statistically he’s part of an extremely high-risk group as far the insurance companies are concerned.  And the data backs them up: Car crashes are the leading cause of death for U.S. teens; and per mile driven, the risk of crashes is four times higher for ages 16-19 than for older drivers. All of this presents challenges when shopping for car insurance for teenagers.

Teenagers, as a group, pose a bigger risk on the road because they lack the judgment that comes with age and the skills that come from experience. You can’t do much about the former, but you can help them gain driving experience and perhaps lower what you pay for auto insurance quotes for your teenagers. The answer is graduated licensing.

Graduated licensing is designed to delay full driving privileges and let your teenage driver gradually gain experience under lower risk conditions. Typically, it involves three stages starting at around age 15 or 16, and progressing up to full licensing by age 17. The first stage is a supervised learner’s period (a licensed adult is in the car while the teen is driving). The intermediate period allows limited unsupervised driving in higher risk conditions. The third stage is a full-privilege driver’s license.

Most states and the District of Colombia now offer a three-stage program because it has proven to be extremely successful, resulting in a 38% - 40% reduction in the number of fatal and non-fatal car crashes in 16-year-old drivers, according the Centers for Disease Control.

The specifics will vary from state to state. Most restrict night driving because four in every 10 teen car-related deaths happen between 9 p.m. and 6 a.m., but the actual hours will differ depending on where you live. Some also limit the number of other teens who can be in the car since studies show that the crash risk for teen drivers increases incrementally in relationship to the number of passengers in the car. One state currently requires novice drivers to display a decal on their cars identifying them as a newbie. Several states restrict cell phone use by teen drivers and others ban texting outright (that’s comforting). Check with your state’s department of motor vehicles to see what type of graduated licensing is available and enroll your kid in it at the earliest date. Completing such a program will give your kid experience and confidence, and it could count favorably when looking for an auto insurance quote for your teenager.

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