Updated October 4, 2019

How Much Does it Cost to Add a Teenager to Car Insurance

Read more about Car Insurance

Adding a teenager to your car insurance doesn't have to mean sky-high rates. How much will teen car insurance actually cost you? Read on for average rates and more.

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How Much Does Car Insurance Cost for Teens?

The cost for insurance will depend on whether your teen will get his/her own insurance or will be added onto yours.

The price difference is significant. Below are two tables illustrating the insurance rates per 6 months:

Prices for an individual insurance policy

AgeMaleFemale
16$4,126$3,923
17$3,616$3,373
18$2,690$2,450
19$2,081$1,969

Note: The above table illustrate rates in New York for a driver with no accidents, and a 2018 Honda Accord. The prices include ONLY liability coverage, and no coverage for the car itself.

Prices for adding your teen to your existing insurance

AgeMaleFemale
16$2,050$1,691
17$1,913$1,439
18$1,724$1,260
19$1,479$1,078

Note: The above table illustrate rates in New York for a driver added onto an existing insurance policy with married parents, high coverage, 2 existing vehicles, and no accidents. The prices do NOT include adding a 3rd vehicle.

The most cost-effective option for teenagers is to add them onto an existing policy. Keep reading to learn why.

Benefits of Adding a Teen to Your Policy

Adding a teen driver to an existing policy costs nearly half what it would to purchase an individual teen car insurance policy. Here are some other benefits:

  • Builds Experience
    This makes it easier for them to qualify for better rates when it is time for them to get a policy on their own.

  • Higher Coverage for a Lower Price
    Adults over age 35 typically choose higher coverage amounts on their policy to protect accumulated assets such as a home, savings, income, and a family.

    These higher limits will extend to any teenage driver added to the policy, which helps protect parents and teens in the event of an accident.

Protect from Unnecessary Financial Loss
When buying a car for their teen, many parents expect them to purchase and pay for their own insurance. However, most are unaware that the name on the insurance policy must match the name on the lease/title of the car.

If it is not done properly, the insurance company can refuse to pay in the event of an accident. This can lead to high medical bills, car repair costs, and liability payments that you are now responsible for.

Downsides of Adding a Teen onto Your Insurance

Adding your teen onto your policy has a few downsides to keep under consideration.

  • Shared Liability Risk
    Teenagers between the ages of 16 and 19 are twice as likely to get into an accident than adults. As the insured and/or legal guardian of your teen, you may be liable if you do not have enough liability coverage to pay for the damage.

  • Potential Rate Increases
    In the event that your teen is involved in an at-fault accident or has a moving violations, you may see an increase in renewal rates.

    This rate increase is typically comprised of two factors, including:

    • Safe driving discount will be removed
    • An accident/violation surcharge

A surcharge can be as high as 30% per 6 months. It will remain on your policy for 3 years from the date of the accident or violation.

What Coverage Does My Teen Need?

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When adding a teen onto your insurance, your existing coverage will automatically include them. However, some adjustments may be necessary to make sure that your coverage is sufficient.

Keep reading to learn more.

Liability

Also known as Bodily Injury, this coverage will compensate the other party for injuries sustained in an accident and will reimburse you for attorney fees in the event of a lawsuit.

Liability coverage is mandatory. Most states have a minimum amount of liability coverage, usually 25/50. Car leasing and financing companies typically require at least 100/300.

How Much Do I Need?
When adding a teen onto your policy, you share the liability. Choose high enough coverage to protect your assets in the event of a lawsuit.

This is especially important if you:

  • Own a home
  • Have a steady income
  • Have savings and/or retirement plans
  • Own a business

Choosing your state minimum liability coverage can save you and your teen money. However, you should increase coverage if you are adding your teen onto your policy to protect yourself and your assets.

Property Damage

Property damage will cover your teen in the event he/she causes damage to someone else's property, including their car, home, trees, or even government property (e.g., traffic signs and light poles).

How Much Do I Need?
Most insurance agents recommend choosing no less than $50,000. Companies usually offer a minimum of $25,000 in coverage. In the event of a multiple car accident or even totaling another party's car, expenses can run much higher.

Coverage for Your Car

There are two main coverages that will cover damage to your vehicle:

  • Collision
    Pays for damage if your car was involved in a collision—whether it was with another driver or a solid object.

  • Comprehensive
    Pays for any damage caused by fire, storm, theft, and vandalism.

Before the insurance company will reimburse you for any damage, a deductible will apply. For example, if you cause $3,000 in damages to your car and you have a $500.00 deductible, you will be reimbursed $2,500.00.

Most insurance companies offer comprehensive with Full Glass coverage. You do not have to pay a deductible to be reimbursed for glass damage.

How Much Do I Need?
The higher deductible you choose, the lower your insurance rates will be. But make sure your deductible is within your budget in the event an accident occurs.

Unless you lease or finance your car, collision and comprehensive coverage is optional. Opting out of these coverages will lower the cost of insurance and can offset some of the cost of adding your teen onto your policy.

Consider removing collision and comprehensive coverages if your vehicle is 10+ years old or if the value of the car is low.

Uninsured/Underinsured Motorist

This coverage will apply if you or your teen is involved in a not-at-fault accident with an uninsured driver or with someone who does not have enough liability insurance.

If your teen's damages are not covered properly by the other party's insurance, you will be reimbursed by your own policy.

How Much Do I Need?
Typically, this coverage is required, and should match your liability coverage amount.

Rental Reimbursement

If your car is involved in an accident, selecting rental reimbursement will allow you to rent a car while your car is being fixed.

This is especially beneficial if your teen travels to work or school, and there is no other vehicle available while their car is being fixed.

How Much Do I Need?
The basic coverage is $30.00 per day for a maximum of 30 days. However, this will only be enough for compact car (e.g., Honda Civic, Chevy Cruze).

If you prefer a larger vehicle or an SUV, or if you drive a high-end vehicle, choose a higher daily limit such as $40.00 or $50.00.

When renting a vehicle, you do not need to purchase additional insurance from the rental company. Your policy will extend to the rental car.

Best Companies for Teen Drivers

Shop around and get quotes from multiple companies to find the best rates and coverage for your teen driver.

When adding a teen to your policy, look for a company that is financially stable and able to pay out on claims.

Top 10 Insurance Companies by Written Premium

CompanyDirect Premiums WrittenMarket Share
State Farm Mutual Automobile Insurance$41,817,41618.1%
Berkshire Hathaway Inc.$29,596,40412.8%
Progressive Corp.$22,786,0349.8%
Allstate Corp.$21,430,4059.3%
USAA Insurance Group$13,154,9395.7%
Liberty Mutual$11,585,9765.0%
Farmers Insurance Group of Companies (3)$10,357,4974.5%
Nationwide Mutual Group$7,341,4763.2%
Travelers Companies Inc.$4,396,7051.9%
American Family Insurance Group$4,381,9621.9%

*Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

Here are some useful tools to help you find the right company and choose the right policy for you and your teen:

  • Our quote guide can make the process of getting a quote simple and quick.

  • Use our comparison tool to get quotes from many different companies at once. You can easily compare prices and coverage to make sure you are getting the best policy.

  • Our coverage guide explains the different coverages to choose from and can help you find coverage that is right for your family.

Ways to Avoid Insurance Rate Increases

  • Add Accident Forgiveness
    This option prevents a rate increase if you have an accident. It will also allow you to keep any safe driving discounts you currently receive.

  • Take a Defensive Driving Class
    Most states offer an approved 6-hour defensive driving class online.

  • Choose a Safe Vehicle
    Safer vehicles are less likely to cause accidents, so they cost less to insure. Check out the Insurance Institute for Highway Safety's 2019 Top Safety Picks list.

How to Add a Teen Driver

To add a teen to your policy, simply contact your insurance agent. Your agent will ask you for some information about your teen, including their:

  • Name
  • Date of birth
  • Driver's license number

If you are adding another vehicle at the same time, you will also need to provide vehicle information including:

  • Year
  • Make
  • Model
  • If it is a leased or financed vehicle

You will likely be asked some questions to see if your teen qualifies for any additional discounts. Keep reading to learn more.

Discounts for Teen Drivers

When adding your teen onto an existing policy, make sure you are utilizing every possible discount to get the best price.

Good Student Discount
If your teen has a 3.0 average or higher, he/she can receive an extra discount. To qualify, send a copy of their most recent report card/transcript to your insurance agent.

Resident Student Discount
If your teen is a student who resides at least 100 miles away from home, most companies offer a discount of approximately 2%-5%. Proof that he/she lives away from home should be sent to your insurance agent.

Driver's Ed Discount
Most insurance companies will give an extra discount if your teen took a Driver's Education course before obtaining his/her license. This discount will typically fall off after your teen has been licensed for 3 years.

Defensive Driving Discount
Taking a Defensive Driving course can save drivers up to 10% on their insurance. This is typically a 6-hour class that can be taken online. It's also offered in person at local churches, libraries, and community centers.

Monitoring Device Discount
Many insurance companies offer a free safety monitoring device that can give feedback on your teen's driving habits. The discount can range from 10%-30% depending on their driving score.

Bottom Line

While prices may be high, it is possible for teens to purchase their own insurance policies. However, to save the most money AND get the best coverage, consider adding your teen to an existing policy.

It is important to be aware of the additional discounts that are available for teens, and to shop around to ensure you are getting the best policy.

More from CreditDonkey:


How Does Car Insurance Work


Best Car Insurance for College Students


How Long Does it Take to Get Car Insurance

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