HOW TO LOWER TEEN CAR INSURANCE RATES

Companies offer a range of tools to drive down costs

Although young drivers almost always have higher automobile insurance rates than older drivers, there are ways to lower insurance premiums for teens who’ve earned a license.

One strategy that families overlook is the discount many insurance companies offer for good grades. Insurers have found that, just as adults with higher credit scores tend to be more responsible drivers, teen-aged students with higher grades are less likely to be involved in accidents, are usually more responsible and make better decisions than students with lower grades.

“Good grades are one way teens can reduce their car insurance rates by as much as 20 percent as a student discount,” said Greg Isaacs, president of Coverhound Insurance Solutions in San Francisco. “Students who earn at least a B average are typically eligible for this discount.”

Teens also can lower their car insurance rates by participating in a driver safety course, he said.

Bobbie Reed, office manager at George A. Reed Agency Inc., an independent insurance broker in Ross, noted another way to lower car insurance for young drivers is buying an older car for them.

”A Ford Taurus will likely be a better choice to fit into the budget than a Camaro or some other high performance vehicle for a kid,“Ms. Reed said. ”In other words, use common sense.

“You can call your insurance agent with the VIN number of a car you want to buy, and we can plug it into our system and tell you down to the penny what it will cost to insure that car,” she said. “It’s a call well made. You can save yourself a considerable amount of money that way.”

Choosing a higher deductible, which is the amount of out-ofpocket money that drivers must pay before an insurance company will cover a claim following an accident, also will lower the cost of a policy for a young driver.

“Ask yourself, if your child were to wreck the car, could you afford to pay a $1,000 deductible? Or should you elect a $500 or $250 deductible?” she said. “Some people who can afford it will pick a $1,500 deductible and significantly lower their insurance costs. Pick a deductible you can afford. There’s a give and take at play here.”

Students who go away to college but leave their car at home also get a break on premiums — and they are fully covered whenever they come home and use the car during class breaks.

Thanks to changes in the industry, Ms. Reed said insurance companies no longer discriminate against young male drivers by charging them higher rates than females the same age. “Today companies don’t differentiate. Now both rates are the same.”