Being on the edge of adulthood might be scary, but your insurance doesn't have to be
For an insurance company, insuring a 17-year-old driver is a considerably risky undertaking. Statistically speaking, 17-year-olds are more likely to engage in dangerous driving practices, which insurance companies see as monetarily risky investments for themselves. Because of this, insurance companies protect their interests from this risk through higher premiums — which results in you paying more money. Because of this, it shouldn't surprise you the average 17-year-old in 2016 paid an annual premium of $5,403 for insurance compared to the national average of $1,323.
In addition, the age of your young driver, the company you chose, your gender, your location, and what car you drive all affect your premium significantly. So, in order to break down car insurance for 17-year-olds and the best ways to save, we are going to examine all of them. Starting first with your company. Let's get started.
In an experiment to determine which car insurance company was the cheapest for teens, we discovered that Geico provided the lowest rate with all other metrics constant with Progressive coming in second. Our profile was a 17-year-old added to their parent's policy across 5 zip codes in the US. If you don't fall into our specific profile or into the zip codes we surveyed (which is highly likely), use our findings as a starting point while looking at many different companies in order to find the best rate for you and your driver. Because your teen's rate changes so much as they age, we suggest shopping for car insurance every 6 months. Do that here with us.
|Location||State Farm||Allstate||Geico||Progressive||Liberty Mutual|
As your child ages, gender becomes less impactful on their premium. But while they're still a young driver, it's a considerable rating factor as young male drivers as seen as as a riskier customer than a young female driver. They are seen as more likely to take driving risks which can lead to claim payouts by insurance companies. On average, 17-year-old males cost $320 more to insure per 6-month policy period. But don't lose hope! Remember: as you age, the insurability difference between men and women becomes less significant. And in fact, some states don't use gender as a metric for determining car insurance rates.
Because insurance is zip-code specific and state-regulated, it will vary based on where you and your young driver live. Generally, most states require a mandatory minimum coverage for others and their property but the monetary amount of this coverage varies. Some states require higher limits and additional coverage that other states do not. Michigan, for example, is a No-Fault state and requires drivers to carry Personal Injury Protection which increases the costs of premiums significantly.
Futhermore, the number of people in your state can also impact your child’s auto insurance rate. States with a low population density, such as Midwestern states like Ohio, tend to have lower premiums than states with more people such as New York. Keeping with the idea of risk management, the more drivers your state has, the more likely you are to be in an accident and insurance companies have to cover that additional risk.
The type of car your teen drives definitely affects your insurance rate as it does with anyone. For example, a teenager with a brand new Mercedes is, without a doubt, going to have a higher premium than a teenager with a new Toyota Corolla. As a good rule-of-thumb, any vehicle with a high MSRP will have a high premium, at the expense your insurance company who will have to replace it. So, if you’re looking for a cheaper rate for your teen driver, you should stick to a simple sedan or van.
Now that we’ve talked about why it is so expensive to insure 17-year-olds, let’s talk about ways to save.
Taking a professional driving course that focuses on how to be a smart and defensive driver is another way to save some extra money on you or your teen's insurance premium. While it is a pretty common discount, your insurance company will usually require proof of this such as a receipt. Not every insurance company offers this discount, so ask your insurance company beforehand!
Having above a 3.0 grade point average can save you quite a lot on your premium. Like the defensive driver discount, your insurance company still requires proof every policy period (6-12 months depending on your policy) that you or your student has the requirements. A transcript usually serves as enough proof for the discount to be added.
Average Savings for Defensive Driver and Good Student Discount
Given the costs we've outlined, you may be tempted to get your 17-year-old their own policy to avoid having to pay for their high premiums. But unless your 17-year-old has some insanely high-paying job and can afford to pay nearly $6,000 per year on auto insurance, it's actually cheaper to keep them on your policy. On average, it costs $57 more per 6-month policy period for a 17-year-old to be on their own policy than to be on the family plan. While that $57 doesn't seem like a lot of money, you should be aware that most insurance companies require anyone who is living in your household and is above legal driving age to be either added as a covered driver or removed entirely . . . . So, that $57, is definitely a silver lining.
Keeping a clean driving record for your son or daughter is an absolute necessity. Distracted driving, reckless driving, or being in an at-fault accident can cause serious damage to your car insurance premium at an already expensive time. In a state-by-state breakdown, DUIs and racing (seen on average the most expensive citations) raise insurance premiums at least 40%. Moreover, most insurance companies offer a good driver discount which is dependent upon a clean driving record.
As you can see, there are many factors that go into your child's premium. Because of this, it's important to shop around for car insurance with as many different companies as possible every 6 months to make sure you're getting the best rate. Only with The Zebra can you see hundreds of different premiums at once.
The moral of the story for car insurance for 17-year-old drivers is that you're going to pay significantly more than the national average for the anticipated additional risk of a young and inexperienced driver. Using the data we collected over 5 companies across 5 zip codes, starting with Geico and then Progressive as well as looking at the discounts we suggested as good places to start for cheap car insurance. Keeping this in mind, the absolute best practice for finding affordable insurance is to look for it frequently — on average, every 6-months. Only with the The Zebra can you get personalized quotes from over 200 car insurance companies at once.
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