Car insuranceIf a car tops your teen's holiday gift wish-list, give as much consideration to insurance as you do the car's make and model and the debate over whether to buy new or used.

And brace yourself for insurance premium sticker shock.

Young drivers keep insurers up at night, and you'll pay the price once your prince or princess gets behind the wheel. The accident rate for drivers ages 16 to 19 is higher than for any other driver age group. Sixteen-year-olds top the list, with an accident rate 3.7 times higher than drivers of all ages, and 1.8 times higher for accidents involving alcohol. The majority of citations given to teens -- 52 percent -- are for speeding, according to Tasha Lockyer, auto insurance editor for, an independent consumer information site.

Car sales are expected to be healthy this month and into the first quarter of next year as prices decline from summer highs, says Lacey Plache, chief economist for car site So if you also want to get a deal on car insurance for your child, here's what you need to know.

Consider What Counts

When it comes to what makes up the price of your premium, a few factors come into play, such as the type of car being insured, the age and driving record of the person being insured, and the amount of coverage in the policy, notes Phil Reed, senior consumer advice editor at

Where and how often you drive also count. Urban areas are usually more expensive than suburban ones, due to higher rates of vandalism, theft, and accidents. If you live in a city, expect to pay more. The more you drive, the more you can expect to pay. "If your teen is just going to be driving to school and back, make sure you include that information in your quote," says Lockyer.

Speak Up

The squeaky wheel gets the grease. Ask for discounts. For example, full time students can cost a little less to insure because many companies offer "good student" discounts (usually requiring a B average or 3.0 GPA), typically between 10-15%. "The discount is significant. Explain it to your teenager and offer to split the savings if they hold up their end of the bargain by meeting the GPA required by your insurance company," says Reed.

Then too, if you've been a loyal customer with few or no claims over a long period of time, you might be able to use that as leverage in getting a better rate.

According to editors at, if you insure your child on your policy, you might be able to get the insurance company to assign the least expensive car in your house to that teen. Then make sure that's the only car that your teen drives.

Pick Your Car Wisely

You can go back and forth for days about buying new or used. When you're shopping for a car, decide what type you'll be buying, then call your insurance company and ask about the differences in the premium between new and used, and among various makes and models. You can save a good amount of money by choosing a car with a lower premium, says Lockyer. SUVs and high performance cars in particular can be more expensive to insure.

Consider too that discounts are sometimes given for particular safety features and theft prevention items like auto alarms. You also might benefit by agreeing to install a tracking device that monitors your child's driving.

Read Them the Riot Act

As the holidays are a celebratory season, have a serious talk with your teen about the responsibility involved in driving safely and wisely. The majority of teen driver fatal car crashes occur between 9 p.m. and 3 a.m. "Consider limiting your teen's driving after 9 p.m.," says Lockyer.

It might help your rates, as well as your peace of mind, to sign your teen up for a "safe driver" program.

Know the Laws

Many states have graduated driver's license laws. In general, this means that young drivers can only drive with a licensed adult for the first 6 to 12 months of being licensed. Many of these laws exclude driving at night and limit the number of passengers, and/or underage passengers, a teen driver can have in the car. "Be aware of the laws in your state," advises Brian Moody, lead editor for the car marketplace site,

Once you have the insurance figured out, then there's that other matter -- making peace with the thought of your baby on the road.

Increase your money and finance knowledge from home

Banking Services 101

Understand your bank's services, and how to get the most from them

View Course »

How to Avoid Financial Scams

Avoid getting duped by financial scams.

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:

Great article, here are several tips from me on how to get cheaper car insurance:
- Use insurance comparison sites like: . Once you register you'll get free quotes from a lot of insurance companies.
- Ask for group discount.Get as many insurances as you need from the same company.
- Stay insured.If you cancel your plan even for several days, some companies may consider you as high risk and you may need to pay more next time.
- Car Security Devices.Any extra security measures you take to deter thieves from stealing your car will further decrease the risks you pose to the insurance company.
- Good driving records.that will definitely lower your price.

January 12 2012 at 4:23 AM Report abuse rate up rate down Reply

Only problem is, the greedy bastard insurance companies want you to insure your kid on cars they are never going to drive. Atleast mine did and another I called said the same thing. Their excuse was, he might drive it when you are not home and wouldn't be covered. To which I replied, I guess your kids are not scared of what you might do.

December 19 2011 at 6:30 PM Report abuse rate up rate down Reply


December 19 2011 at 5:28 PM Report abuse rate up rate down Reply


December 19 2011 at 5:28 PM Report abuse rate up rate down Reply

Don't let them drive, or drive as little as possible.

Going to the local High School to help my daughter with a dead car battery, I was almost run over by a high school female zipping her car, driving it across the parking lot, not in a lane but through the lanes way past parking lot speeds. She was not looking left or right -- just had a speeding agenda of straight ahead. She does not need to be on the road.

In reality, youth need experience in driving -- they just need to stay away from difficult decision, driving a bit slower, not prodded on by others and learning just what to do in tough situations.

December 19 2011 at 10:18 AM Report abuse rate up rate down Reply

as for cars
ford taurus
dodge stratus/chrysler sebring
these models are pleniful and inexpensive to repair, carry liability insurance only, no comprehensive insurance.

December 18 2011 at 8:22 AM Report abuse +2 rate up rate down Reply

Don't forget to make sure your child has the same Uninsured Motorist insurance coverage limits as you. Uninsured/underinsured motorist coverage pays for personal injury damages (which can run into Millions of dollars) when the person who injures your child is either uninsured or underinsured (carries low limits).

No one (even if you are judgment-proof) should have less than $1 million in liability and Uninsured/Underinsured motorist insurance. Just imagine your child or you being terribly injured, or being significantly disabled, incurring big medical bills, or living with severe pain and suffering. The additional cost is MINIMAL.

Whether you own or rent your home, you can also buy an "Umbrella" policy - INCLUDING Uninsured/Underinsured motorist coverage - with the same coverage amount as the "liability" coverage.

Just because your child is a child (who can easily file for bankruptcy if they seriously injure or kill someone)
they still need the same (and even more) protection against someone seriously injuring them.

It is preferable to deal with a "Broker" (not an "agent"). A broker is responsible for making sure you have enough insurance - and can shop a number of insurance companies to do so. (The Farmers, State Farm, GEICO's, "Progressive's" (what a joke), AAA, etc. .. have no duty to make sure you are buying adequate insurance.)

So .... make your priority protecting your child (and your family) against not just claims against you - but EQUALLY importantly - against being injured.

December 17 2011 at 4:51 PM Report abuse rate up rate down Reply