Should You Add Your Teen Or Let Them Get Their Own Car Insurance Policy?

Posted on: 18 August 2015

That moment comes for all parents of teenagers when it's time to make a decision: Should you add your teen to your policy? Or should you let your teen have their own policy? This is an important and weighty decision that can have far-reaching effects.

Should You Add Them to Your Policy?

Adding your teen to your policy isn't like adding another adult. Teenagers are high risk, and adding a high-risk driver to your policy will cause your rates to go up, possibly by a lot.

However, adding a teen to your policy is usually cheaper than letting your teen have a policy of their own. Even though your driving record won't save you from the hit your rate will take, it will soften it a little bit.

Should You Let Them Have Their Own Policy?

First off, a policy that only covers your teen will not come cheaply. Insurance for high-risk drivers is usually more expensive. If you're the one paying the insurance for your teen, then you need to take that into consideration.

If your teen has their own policy, they're only covered for the car on that policy. If you let your teen drive your car and something happens, your insurance may not cover it. If your teen's policy has coverage for situations like that, then you're at the mercy of your teen's policy.

The benefits of your teen having their own policy have more to do with teaching financial responsibility and building a good record. Prompt payments and safe driving will directly translate to good credit and lower insurance costs in the future.

Which Should You Choose?

In most cases, it's cheaper to add your teen to your policy. You may already have discounts in effect, or some kind of bundled insurance package with your insurer. In addition, if you have been with the same insurer for a long time, they may offer you more discounts when you add another person or car to your policy.

Your teen can help you find more discounts as well. Whether with their own policy or on yours, they may become eligible for discounts. Many insurers offer discounts for things like good grades or taking driving safety courses.

Don't Assume, Get Quotes for Both

Insurance companies all have different criteria for how they insure individuals. Don't assume that one option is automatically cheaper than the other. You should go about gathering quotes for both, adding your teen, and a single policy for your teen. It may seem like adding your teen is always the cheapest option, but you never know. Visit Butler & Messier Insurance for more information.

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