Replies

OK.

So, if you are adding a new driver to existing policy. One step to lower premiums is to carry liability limits (Bodily injury (BI), and property damage liability(PD)) ABOVE the state minimum requirements. Most people unknowingly do - simply because their agent automatically selects that for them. HOWEVER, many people carry low BI/PD either because it will give them lower rates//or they just assume it will. The “average” decent level of liability coverage to carry is 100,000 per person for bodily injury/
300,000 per accident for bodily injury and
50,000 per accident for property damage.

Now, that of course is something a consumer can adjust up or down. I would never suggest a person carry less than that, and I personally carry much more. I would suggest a higher PD limit than the above example if adding a teen.

The reason that rates can be lower if you carry BETTER limits in coverage, is simply that it’s an indicator of how responsible you may be. Even if the rate is not lower, it may be only a little higher to carry better coverage and it is worth it.

Specifics that can help if adding a young person: (without knowing which state you live in)

A four door sedan is almost always cheaper to insure the young person on. Lets say you have two cars, and the youth will actually be driving the two door cute car, and you are in the sedan - just tell your agent that you will be having your youth drive the sedan, and you use the two door. Generally, any driver listed on your policy is covered on any car listed in your policy. So, you are not going to have to worry if your teen gets in a fender bender in a listed auto other than the one said child is “assigned” to in the policy. There are only a few states where that may be an issue - CA for example.

Next is defensive driver discount. Most insurance companies allow a discount for a youth who has had either drivers training, or a defensive driver course (both provide a completion certificate).

Another is “good student” discount. Fewer companies offer this, but it’s a good discount. I think the youth has to carry a B+ average, and you have to provide proof to get the discount. You may only be able to use one of the available discounts, but a few companies will combine two.

Next is the deductibles for physical damage done to YOUR vehicles. If the (sedan :)) car that your youth will be driving is an older model and there is no auto loan on it you may consider carrying no collision coverage. So, if your child backs into a pole and dents the car - you live with the dent, or pay out of pocket for the repair. If you go this route I would suggest that you do carry COMPREHENSIVE coverage, which covers most (naturally occurring) damage to a vehicle other than collision. Comp is usually very inexpensive even with a fairly low deductible, and you can often add “full glass”, and roadside assistance, for just a little more. Comp covers broken glass (minus deductible if you do not carry full glass cov.), collision with animals, flood and hail damage, fire, theft, falling tree limbs-you get the picture.

Here is a big issue that most do not know about. Inform your child that under NO circumstances should they allow a “friend” to drive the car. If an accident occurs and the police call you and ask - “Did you give permission for the friend to operate your vehicle?” - say HELL NO! There is a world of legal nightmare waiting if your child is letting other people drive a vehicle listed on your policy. HOWEVER - if you, yourself directly loan your auto to a friend, there is coverage - if that friend turns around and lets their buddy drive your car - there is none.

Again, there are just a couple of states that have VERY specific and hard to follow laws and regs re:insurance. These are the general guidelines for about 90% of the states. For example, in NY we have a coverage called “personal injury protection”. Most NYers do not know that they can reduce their premiums a bit by selecting a per-person deductible on their PIP coverage.

Sorry if it’s a lot to process - I can try to be more specific if you need me to be. :)

IN order-

Teen is assigned to a four door sedan, usually a lower rate.

Auto teen is assigned to has no coverage for collision damage.

Drivers discounts - drivers ed, defensive driving, good student.