They Turn 16 and Want to Drive, Too.

Insurance for a teenager. The companies insure an inexperienced immortal, who has only been alive for 16 years, who’s brain won’t finish being developed for years to come and who is sitting in the position of power in a machine weighing 5,000 pounds..…there isn’t enough money.

From an insurance company view, the challenge is to charge enough for their coverage, while considering all of the possibilities. They look at a number of “rating points”. Some of those points THAT A TEEN CAN DIRECTLY EFFECT AND EFFECT THEIR COSTS are as follows:

1. What you do has consequences for which you are responsible. Tickets cost in a number of ways. First, paying the state for the ticket might cause short term discomfort since you probably didn’t budget for a speeding ticket. Secondly, you will pay for your ticket through your cost of insurance. The ticket stays on your state driving record for three years, so a longer term consequence. There are some insurance companies for whom the ticket can increase your cost of insurance for up to five years. If you continue making bad driving choices, your insurance company can drop you all together as a bad risk.

2. GRANDPARENT ALERT: before you buy the new big, shiny whoop-d-doo 4×4 truck or shiny, sleek, powerful grumbly sport car for your hard working graduate: don’t, unless you want to pay for the insurance until the teen is 25. A Corvette + two speed tickets (they seem to go hand in hand) would cost the same for insurance as college tuition. A stock Honda with no tickets is MUCH less costly.

3. Keep your grades up to 3.0 or higher. While you are going to school, you pay your parents back by working hard at possibly the only job you’re asked to do: doing well in school and bringing home good grades. Your 3.0 puts up to $200. back in your parent’s pockets every six months as if you had a job outside of school, brought home a pay check and handed it over.

Over time the insurance company will get to know you and find that you are trustworthy, get good grades and keep your eyes on the road and foot off of the accelerator. Until that happy day, keep in mind 1-3 above and use your common sense to keep your cost of insurance down and your families bank balance up.