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Published: May 3, 2022Last updated: October 17, 2022

Adding a Teen Driver to Car Insurance

How to save money when you add your teen to your policy

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Aside from the natural fear and anxiety that comes with your child learning to drive, there’s the insurance hike. It makes sense that insurance companies charge more for teenage drivers, as their lack of driving experience leads to more costly accidents. But what can you do to mitigate the cost, and is it better to get your teen a separate policy or add them to your own?

Should You Get Your Teen Their Own Policy?

In most cases, the cost of car insurance for teens will be lower if you add them to your existing policy, although it’ll increase your premiums.

Reasons to Add a Teen Driver to Your Policy

  • While your teenager is just starting out in the world of driving, you have a driving history as well as a credit history, which means they can benefit from your experience. If you are the primary driver on the policy, the insurance company will consider your driving history more than theirs.
  • You can easily update the policy for both you and your teen, such as by lowering or adding limits and adding or subtracting coverages.
  • Your teenager will be able to drive all of the vehicles in your household.
  • Managing one policy is easier than managing multiple policies.

Reasons Not to Add a Teen Driver to Your Policy

  • If you have a luxury vehicle or sports car that you won’t let your teen drive, it’s best to get them a separate policy for the car they will drive.1

How to Add Your Teen to Your Policy

If you’ve decided that adding your teen to your existing auto insurance policy is the way to go, or if you’re still contemplating it, keep reading to learn more.

When to Add Your Teen to Your Policy

Ask your agent when you should add your teen to your insurance policy. It may be best to wait until they get their learner’s permit or even their unrestricted license. However, there’s no hard-and-fast rule as to when you should add your teenager to your policy.2

How to Add Your Teen to Your Policy

  1. Contact your insurance agent and tell them you want to add your teenager to your existing policy.
  2. Answer any questions the insurer has.
  3. Read your rewritten policy to make sure you understand and it’s accurate.
  4. Pay your new premiums. The coverage will kick in on the policy’s effective date.

How to Save Money When You Add Your Teen to Your Policy

  • Bundle. You’ve already bundled your child’s and your car insurance together, but if you have any other types of insurance with different companies (life, renters, home, etc.), bundle them all under the same provider. Most companies offer bundling discounts.
  • Lower your limits. There’s no doubt that lowering your liability limits will also lower your car insurance premiums. Given teenagers’ propensity for car accidents, though, we recommend buying as much insurance as you can afford. Short-term savings could mean higher costs down the line.
  • Drop coverages. You may not need comprehensive coverage on an older car or rental car coverage if you own multiple vehicles. Feel free to drop any coverages your state doesn’t require; again, just keep your financial responsibility in mind.
  • Raise deductibles. You can raise your deductibles to lower your auto insurance costs. However, you’ll have to pay more if your child causes a comprehensive or collision claim.
  • Get them a safe car. Insurance companies base their prices partially on vehicle safety ratings, so get your kid an affordable but safe car (find out more about the best cars for teens below).

CheckTIP

Unless you live in Michigan, Hawaii, Massachusetts, or California, a higher credit score means a lower insurance rate. To raise your credit score, pay your bills on time, use your credit cards, and keep a good credit mix.

How Much Car Insurance Increases With Teenage Drivers

Even if you apply all the best practices for saving money, you should still expect to pay about 45 percent more when you add your teen to your car insurance policy. This is based on the average annual cost of insurance for teens, which is $3,751.02 — 45 percent higher than the average across all age groups ($2,070.62).

Average Car Insurance Rates by Driver’s Age

Car insurance rates vary by age throughout our lives, but for new drivers, they’re the highest they’ll ever be, all else being equal.

Age Average annual car insurance cost
16 $4,368
17 $3,925
18 $3,952.75
19 $2,758.33

When Do Rates Decrease?

You can expect rates to decrease by the time your teen turns 19 or 20, reaching normal levels by age 25. See below for the average insurance costs from Progressive for 2020 to 2021.

Age Average annual rate, September 2020 to August 2021 Price difference from previous age group
17 and under $206 N/A
18 $230 12%
19-20 $203 -12%
21-22 $176 -13%
23-24 $153 -13%
25-29 $136 -11%
30-34 $127 -6%
35-39 $124 -2%
40-44 $122 -2%
45-49 $120 -1%
50-54 $111 -8%
55-64 $100 -10%
65-74 $96 -3%
75 and over $101 4%

Why Is Car Insurance for Teens So Expensive?

There’s a simple reason why car insurance for teens is so expensive: They have the highest rates of motor vehicle deaths and crashes of all types.

Age group 2020 rate of motor vehicle crash deaths per 100,000 licensed drivers 2020 rate of motor vehicle crashes per 100,000 licensed drivers
16-19 44 22,103
20-24 39 15,876
25-34 34 11,941
35-44 26 9,062
45-54 23 7,776
55-64 20 6,187
65-74 14 4,383
75 and over 24 3,3693

In general, a 16-year-old driver is considered a worse driver than any other age, with a higher rate of claims. A 16-year-old driver is 32 percent more likely to get into fatal crashes and 45 percent more likely to get into any type of crash than the average across all age groups. No wonder the cost of car insurance for 16-year-olds is the highest.

How Much Coverage Your Teen Driver Needs

You always need to meet the minimum coverage requirements, which vary by state — but they’re insufficient for your teen driver, no matter where you live. When it comes to your teen’s auto insurance coverage, the more, the better. We recommend full coverage, which includes the following.

  • Bodily injury liability coverage: Bodily injury liability covers any medical costs your child causes to another car’s driver and passengers. Buy as much as you can afford, up to $500,000 when combined with property damage liability.
  • Property damage liability coverage: Property damage liability covers any third party’s property damages in accidents your teen causes.
  • Collision coverage: Collision coverage pays for your property damages in accidents your child causes. The limit will be your car’s actual market value (AMV).
  • Comprehensive coverage: Unless you have an old car, it’s best to get comprehensive coverage to pay for property damages from events other than collisions (such as car theft, vandalism, and inclement weather). As with collision coverage, the comprehensive limit is your car’s AMV.
  • Medical payments coverage or personal injury protection (PIP): Even if you already have health insurance, you can add medical payments coverage in at-fault states or PIP in no-fault states like Florida. Medical payments coverage includes only the costs of your injuries, while PIP also covers any lost wages or child care you have to pay for as a result of your injuries.

If you live in a state with a large number of uninsured motorists, you may want to consider adding uninsured/underinsured motorist coverage. This will cover your bodily injury and property damage costs if your child gets into an accident with someone driving with no insurance or insufficient insurance.

CheckDID YOU KNOW?

The state with the highest uninsured motorist rate is Mississippi, where nearly 1 in 3 drivers lack insurance. Learn more in our uninsured motorist research.

Some other supplemental coverages to consider are roadside assistance and rental car coverage. 

  • Roadside assistance: Unless you already have third-party roadside assistance from a company like AAA, bundle it with your car insurance to get your child access to locksmiths, tows, jump-starts, or whatever they need if they break down on the side of the road. 
  • Rental car coverage: While rental car coverage likely isn’t necessary for households with multiple vehicles, if you only have one vehicle and it’s being repaired under a covered claim, this coverage will pay for a rental ride. This is especially important if you live in an area lacking public transportation. 

How to Prepare Your Teen Driver

  1. Send them to driver’s ed. One obvious teen driver safety tip is to send them to driver training courses if you can afford them. This might be easier (and less nerve-wracking) than teaching them to drive yourself.
  2. Set a good example. When you’re driving, make sure you’re following all state rules and not using any electronic devices. Distracted driving among teens is very common, unfortunately, but you can help discourage it by not partaking yourself.
  3. Involve them in maintenance and insurance. For a teenager, being able to drive is a push toward independence, giving them the power to travel without depending on you for rides. Of course, with great power comes great responsibility. To help your child understand the real consequences of accidents and reckless or negligent driving, involve them in their car’s maintenance and financial aspects, from oil changes to insurance premiums. While it might be unreasonable to expect them to pay the entire premium, paying a fraction will teach them responsibility and turn them into a more careful driver, as they know their rates will increase after an at-fault accident.
  4. Practice with them. If you’re not too afraid, have your child practice driving with you in the passenger seat, starting in an empty parking lot before moving on to low-traffic areas. Always remain calm or at least project calmness, as your mood will affect your child’s mindset and, therefore, their driving.
  5. Use a checklist. To ensure you’re teaching them everything they need to know, use the checklist from the Center for Injury Research and Prevention at the Children’s Hospital of Philadelphia, accessible via https://injury.research.chop.edu/sites/default/files/documents/tdp_goal_guide_0.pdf.
  6. Sign a parent-teen contract. Obviously, your child is obligated to follow state and local laws, but the restrictions don’t need to stop there. You could sign a parent-teen driving contract with your child, outlining any additional restrictions you want them to abide by, like curfews, passenger limits, or supervision. For example, maybe you don’t want your child to drive with a particularly distracting friend, or driving at night at all, even if your state allows it.

The Best Cars for Teen Drivers: What to Look For

  • Good crash test ratings: Safety should be your No. 1 priority in a car, so look for high crash test ratings from the National Highway Traffic Safety Administration4 and the Insurance Institute for Highway Safety5. These data points measure a car’s crashworthiness, how well it protects its passengers, and its crash avoidance or mitigation — how it can either prevent crashes or lessen their severity.
  • Safe technology: Look for cars with safety features such as driver monitoring, anti-lock brakes, and automatic high beams6.
  • Sedans: Sedans are preferable to SUVs and pickup trucks, which are hard to park.
  • Low to medium horsepower: High-horsepower cars are at higher risk of hydroplaning.

Important Insurance Terms for Teen Drivers

  • Permissive use clause: A permissive use clause is a portion of your insurance policy that allows people who borrow your car with permission to get coverage under your policy. It’s designed for occasional, short-term borrowing, not your teen who uses your car regularly and lives in your household. Note that misrepresentation on your application could result in a midterm cancellation.7
  • Driver risk: Driver risk, part of insurance providers’ driver classification, measures how prone someone is to collisions, fatalities, and injuries. Drivers are classified as either safe, acceptable, or risky — or low, medium, or high risk. Teens are rated as high risk automatically because of their lack of experience behind the wheel.
  • Primary driver: The primary driver is the person listed on a policy who drives a vehicle the most. Therefore, the primary driver’s risk level is the main data point an insurance company considers when determining premiums.
  • Secondary driver: A secondary driver is a person listed on an insurance policy who uses a car less than the primary driver. While the insurer takes the secondary driver’s risk level into account, it’s at a lower percentage than the primary driver’s risk level.
  • Excluded driver: An excluded driver is someone your policy excludes from coverage, meaning they’re not allowed to borrow your car. If they borrow your car anyway and get into an accident, they won’t be covered, whereas a rated or named driver would be covered. Not all states allow for excluded drivers.
State Are excluded drivers allowed on personal policies?
Alabama Yes
Alaska Yes, if a driver has proven to be a greater risk than any other covered drivers
Arizona Yes, but cannot exclude vehicle occupants; does not apply to uninsured/underinsured motorist coverage
Arkansas Yes
California Yes
Colorado Yes
Connecticut Yes
Delaware No, unless the excluded driver has violations; must notify the DMV within 30 days of a coverage offer
District of Columbia Yes
Florida Yes, can exclude from PIP, property damage and bodily injury liability, uninsured motorist coverage, and any other coverage not required by law; however, can’t exclude coverage if an excluded person is injured while not operating the car, the exclusion is discriminatory under Florida Insurance Code, or it’s inconsistent with the insurer’s underwriting rules
Georgia Yes
Hawaii Yes
Idaho Yes
Illinois Yes
Indiana Yes, if an insurer is not satisfied with “insurability” of driver
Iowa Yes, but only if their driver’s license has been suspended or revoked; the driver was speed-racing while covered under the policy; or the driver has been convicted or forfeited bail for criminal negligence resulting in death, homicide, or assault from operating a motor vehicle, or driving while intoxicated or under the influence
Kansas No
Kentucky Yes, but for a spouse or dependent, can only exclude coverage above the state minimum
Louisiana Yes
Maine Yes
Maryland Yes
Massachusetts Yes
Michigan Yes
Minnesota Yes
Mississippi Yes
Missouri Yes
Montana Yes
Nebraska Yes
Nevada Yes
New Hampshire Yes, but still required to provide minimum financial responsibility limits for an excluded driver operating a vehicle with permission
New Jersey Yes, but only for comprehensive and collision portions of standard policies
New Mexico Yes
New York No
North Carolina No
North Dakota Yes
Ohio Yes
Oklahoma Yes
Oregon Yes
Pennsylvania Yes, but only if the excluded person proves they have auto insurance with another company or the Assigned Risk Plan
Rhode Island Yes
South Carolina Yes, but only if the excluded person has turned their license over to the DMV
South Dakota Yes
Tennessee Yes
Texas Yes
Utah Yes
Vermont No
Virginia Yes
Washington Yes
West Virginia Yes
Wisconsin Yes
Wyoming Yes

Conclusion

That’s all for this auto insurance guide, but if you want to learn more, you can also keep reading about the process of adding your teenager to your car insurance policy in our frequently asked questions below.

Frequently Asked Questions

How much does it cost to add a 16-year-old to my GEICO car insurance?

It costs an average of $1,857 to add a 16-year-old to your GEICO car insurance. However, you can get discounts if your teen takes driver training programs, such as a defensive driving course, or has a B average, dean’s list recognition, or similar academic honors. While the driver training discount will vary, the good student discount can be up to 15 percent for a young driver with good grades.

Can my son drive my car if he’s not insured?

Your son can drive your car if he’s not insured under your policy’s permissive use clause. However, if he drives your car regularly, you should add him to your insurance policy as a secondary driver. Otherwise, your insurance company could cancel your policy for misrepresentation.

Can my daughter drive my car?

Your daughter can drive your car as long as she meets your state’s graduated driver licensing laws. If she only drives occasionally, a permissive use clause would allow your daughter to drive your car and get insurance coverage. If her driving is more regular, you must add your daughter as a secondary driver on your policy for coverage.

Can you teach your child to drive?

You can teach your child to drive. Many helpful resources are available, such as checklists, goal guides, and progress trackers. However, it might be easier to send them to driver training school, where professionals can teach them.

Citations

  1. Car insurance for teens. Progressive. (2022).
    https://www.progressive.com/answers/teen-driver-insurance/

  2. Adding a teen driver to your car insurance policy. Nationwide. (2022).
    https://www.nationwide.com/lc/resources/auto-insurance/articles/adding-a-driver-to-car-insurance

  3. Age of Driver. NSC. (2022). https://injuryfacts.nsc.org/motor-vehicle/overview/age-of-driver/

  4. Vehicle Crash Test Database. NHTSA. (2022). https://www.nhtsa.gov/research-data/research-testing-databases#/vehicle

  5. Vehicle ratings. IIHS. (2022). https://www.iihs.org/ratings

  6. Best Cars for Teens: The List Every Parent Needs. Kelley Blue Book. (2022). https://www.kbb.com/best-cars/teens/

  7. What Happens if a Friend Wrecks My Vehicle?. Farmers Insurance. (2022). https://www.farmers.com/learn/insurance-questions/what-if-a-friend-crashes-my-car/