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Young Driver Auto Insurance: The Pros and Cons

Navigating the purchase process of auto insurance can be challenging for anyone and young drivers often face additional obstacles during this process. Underwriters at insurance companies view youthful drivers, who are generally defined as drivers under the age of 25, as both inexperienced and reckless - statistically a dangerous combination. While this information is sobering for new drivers, there are advantages to being on the younger side of the driver spectrum. While youthful drivers typically pay more for auto insurance premiums, they can also benefit from safe driver and “good student” discounts not available to more mature drivers. Here are some of the advantages and disadvantages of being a young driver trying to obtain auto insurance.

Pros
Many automobile insurance carriers now offer “good student” discounts, which are more likely to apply to young drivers. By completing a recognized driver’s education course and maintaining high marks in school, young drivers can demonstrate maturity and responsibility to their automobile insurance carrier. Discuss this discount with any prospective insurance company to find out if it is available and how much of a discount is offered, as this varies by carrier. Some insurance companies offer youthful drivers discounts for remaining accident and ticket-free for a specific period, such as a term of the policy. Defensive driving courses can be taken periodically to reduce premiums, so younger drivers should look to take advantage of this opportunity.

Cons
When it comes to car insurance, being less than 25 years of age is a key factor in the determination of premium and youthful males will typically pay more in car insurance premiums than will young females. Auto insurers base premiums on a statistical calculation of determined risk. The only way to overcome this factor is to await the passage of time. Most insurance carriers want a minimum of three years of driving practice before they will consider someone “experienced.” In addition, if a youthful driver is added to his or her parent’s auto insurance policy, the younger driver’s record will affect the parent’s premium. Any tickets, accidents or claims might cause an increased premium of all vehicles on the policy. It is important to research all coverage options to determine if the young driver should obtain his or her own policy or be added to the policy of a parent.

The Bottom Line
Auto insurance is required by law and serves an important role in society. By thoroughly researching all available discount programs and maintaining a clean driving record, young drivers can minimize the negative impact their age has on their car insurance coverage.