Our son didn’t start driving until he was 19. Since he started at a late age, we hoped his insurance wouldn’t be as expensive as if he had started driving at 16. Unfortunately, we were wrong; insuring an inexperienced driver costs a lot regardless of age. Here’s how we’re handling car insurance for our teen college student.

Should He Have His Insurance or Be Insured Under Ours?

Our first decision was if he should have his car insurance or be insured under our insurance. We already knew we wanted him to pay the car insurance. When the quotes came back, we knew we had to have him on our insurance. To put him on his insurance was almost four times as expensive as putting him on ours.

How Can We Protect Ourselves Financially?

Our next decision was how to protect ourselves financially if he had an accident. Since he’s under our insurance, if our son had an accident with another vehicle, the victims could sue us. So, we decided to get an umbrella policy. Without a teen driver, the umbrella policy was only $260 a year. Once we added our son to our insurance, our umbrella policy increased to $500 a year. However, this policy provides us with an additional $1 million in protection. Our insurance agent also assured us that if we were to get sued, the insurance company would put their lawyers on the case because they wouldn’t want to pay a million-dollar settlement.

Requirements for Umbrella Insurance

To qualify for umbrella insurance, we had to have our car premiums at a certain level. We could not have PL/PD on the 19-year-old vehicle our son drives. Fortunately, we already have insurance on all our cars and our home at the appropriate level.

Finding Discounts

In addition to putting our son on our insurance, we also looked for other discounts. We’re insured with State Farm, and they had several more discounts we could utilize:

Multiple Line

We got a multi-line discount on all our policies because we have several cars and our home insurance through State Farm.

Good Student

Our son maintains a 3.6 GPA at college, so he qualifies for a good student discount. Every semester, he must submit his report card to verify he’s maintaining his GPA.

Drive Safe and Save

He took advantage of this discount by downloading the app on his phone and installing a beacon in his car. This records data on how he drives, and he gets a discount for safe driving. (If the driver’s driving does not warrant a discount, they are not penalized. However, they don’t get the discount.)

In addition, State Farm had an online course that new drivers take to save even more. My son took that course.

Final Thoughts

Car insurance for a new teen driver is expensive. However, we’ve found a way to make it affordable thanks to putting our son on our insurance and utilizing multiple discounts. In addition, while we pay for the umbrella insurance, our son pays for his insurance, which incentivizes safe driving. And his policy will drop significantly once he gets through three years of driving with no accidents. Only two-and-a-half more years to go!

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Melissa Batai

Melissa is a writer and virtual assistant. She earned her Master’s from Southern Illinois University, and her Bachelor’s in English from the University of Michigan. When she’s not working, you can find her homeschooling her kids, reading a good book, or cooking. She resides in Arizona where she dislikes the summer heat but loves the natural beauty of the area.

Our oldest is 18.5 years old, and he finally decided to drive. We’re thankful he didn’t want to earlier because he’s in the highest risk category to cover, according to our insurance—he’s male, under 25, and has been driving less than three years. However, we’re using strategies to lower the insurance premium for a teen driver. We’re also implementing strategies to protect our finances while he’s on our insurance policy.

4 Strategies to Lower the Insurance Premium for a Teen Driver

Even though he’s in the highest-risk category for coverage, we can take advantage of several discounts to lower his premium.

We Have a Multi-Line Discount

We already have our two vehicles and home insured by the same insurance company. Our son will join and benefit from our multi-line discount.

He’ll Drive Our Oldest Vehicle

Generally, the newer a vehicle, the more expensive it is to insure. Since he’s a teen driver with a higher risk of having an accident than us, we’re giving him our oldest vehicle to drive—a 2004 minivan. Having him as the primary driver on the oldest car gives him a lower insurance premium than if he were driving a newer vehicle.

He’ll Get a Good Student Discount

Because he is maintaining higher than a B average in college, he will receive a good student discount.

He’ll Use the Drive Safe and Save App

In addition, he’ll use the Drive Safe and Save app. While this app can’t make his premium increase if he’s a bad driver, it can help him realize a significant discount if he’s a good driver. My husband and I already use this app and have seen our premiums drop by more than 20 percent.

A Future Discount

While he doesn’t currently qualify, he’ll get a safe driver discount if he drives for three years without a ticket or an accident. We’re hoping he will get this discount eventually, but with teen drivers, there is a sharp learning curve, so he may not.

An Additional Step We’re Taking to Protect Ourselves

The least financially risky way to insure him is to have him own his car and pay for his auto insurance policy. However, that will more than double (close to triple) the amount he will need to pay for car insurance.

Instead, we’re adding him to our policy, but we’re also adding an umbrella policy to our line of insurance. So then, if our son causes an accident that results in more money than his auto insurance covers, our umbrella policy will kick in. This will protect us because when he’s under our insurance, the victim can come after our assets if our son causes an accident.

Final Thoughts

After our son, we have two more children who we’ll add to our insurance policy when they learn to drive. So, we’ll continue to utilize these strategies to lower the insurance premiums for a teen driver and to protect our assets with umbrella insurance. While teen drivers raise our insurance premiums, this season of life will only last for the next six to eight years until our teens are on their own and paying for their expenses.

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Melissa Batai

Melissa is a writer and virtual assistant. She earned her Master’s from Southern Illinois University, and her Bachelor’s in English from the University of Michigan. When she’s not working, you can find her homeschooling her kids, reading a good book, or cooking. She resides in Arizona where she dislikes the summer heat but loves the natural beauty of the area.