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Do I Have to Add My Teenager to My Car Insurance?

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  • Do I Have to Add My Teenager to My Car Insurance?

The excitement your teenage son or daughter feels when they’re able to start driving might be the exact opposite of what you’re feeling as a parent: nervous. They have more responsibility and more freedom, which is an understandable cause for apprehension.

You might also be nervous about your car insurance rates with a teenage driver since you’ve probably heard bad things. Let’s clarify what you need to know, and hopefully ease your nerves a little, by going over whether you have to add your teenager to your car insurance or not and how much it could cost you.

Do I Have to Add My Teenager to My Car Insurance?

Yes, you’ll have to add your teenager to your car insurance if they’re living with you or driving your car primarily. Some states and companies will expect you to add your teen driver to your policy when they get their permit, while other times you’ll need to wait until they get their license.

When you get an auto policy, insurers usually ask you to list all drivers in your household. Online quoting tools often have options to add a child who isn’t yet licensed. This way, a company can be aware of when your teen becomes driving age in your house before it even happens.

If you don’t remember or realize to add your teen when getting your policy, you should notify your insurance company when they start driving. Most young drivers use a parent’s car, at least at first. To receive coverage, your teen will need to be listed on your policy if he or she is going to be regularly driving your car.

If your teen is living in your house and has their own car, it’ll still likely be cheaper (for your kid) to add that vehicle to your policy than for your teen to get separate coverage. Some states allow you to get your own car insurance under the age of 18, but insurers usually require a parent or guardian to co-sign in this case anyway.

This means even if your teen has their own car and policy (that you’ve co-signed), you could still be financially responsible after an accident that exceeds their coverage limits if you’re their legal guardian, or if the car is in your name.

Additionally, rates for a teen driver with their own policy would be astronomical, to say the least. Even with the state minimum required amount of car insurance, young drivers almost always pay more than older drivers for coverage.

“Hiding” your teen from your auto insurance company is always a bad idea. If your teenager causes an accident or any sort of claim, your carrier could deny you coverage if they didn’t know you had a teen driver. This means you and your teen would be personally liable for all damages. In some cases, an insurer will cover the claim from a teen driver of a policyholder they didn’t know about, but they’ll recoup the costs from you over time. 

And, of course, a teen driving without any insurance is illegal. If caught, they can get their license and registration suspended, which is a particularly damaging start to your driving life. Also, once they’re allowed to drive again, such a penalty would make it even more expensive than it already would be for this young driver to get the needed insurance coverage. They would immediately be classified as high-risk.

How Is My Child Covered Under My Car Insurance?

Before they reach driving age, your child is always covered as a passenger in your car for possible medical expenses. When they start driving, your teen has the same coverage levels and deductibles that you do as long as they’re listed on your policy.

If you have only liability coverage to protect against property damage and bodily injury that you may cause to others, then this is the coverage your child will have when they start driving under your insurance. 

If you have a leased or financed car, you probably have full coverage. The same protections of full coverage, meaning collision insurance and comprehensive insurance, apply to your child when they’re driving, too, as long as they’re added onto your policy.

You should contact your auto insurer when your teen gets their learner’s permit if your carrier doesn’t already know your teen has started driving. Some companies will recognize them as regular drivers when they get a permit, while other carriers will wait until they get their license.

According to Fox Business, many companies in Illinois, Indiana, Maryland, New York, North Carolina, Ohio, Pennsylvania, Virginia and West Virginia all expect you to list teens with learner’s permits on your auto insurance.

Car insurance typically follows the car, not the driver. This is why your coverage can extend to someone who you let borrow your car, often called permissive use. But, if someone is going to be driving your car regularly, like your teenager, they need to be added to your policy.

Insurance companies are in the business of calculating risk. They set your premiums based on the level of risk that they are taking on by covering you. To accurately assess the risk you pose, they need to know who will be regularly driving the car. 

Think about it like this. Your car insurance is meant to protect you and your vehicle financially from damage you can encounter on the road. Your carrier needs to know all the drivers of your car to protect you sufficiently. If you don’t add a consistent driver of your car to your policy, like your teen, they typically won’t be covered because your insurer won’t be aware of the risk.

How Much Does It Cost to Add a Teenager to Car Insurance?

Unfortunately, adding your teen to your car insurance can raise your premiums by 50% to 100%, if not more. Your rate can easily double when adding a new teen driver.

Sixteen-year-olds are the most costly demographic to insure in a vehicle. On average, coverage for a 16-year-old can cost $2,661, with premiums being slightly higher for males than females. Young drivers, especially males, are more likely to speed, drive at night, and drive recklessly than older drivers. They have no favorable driving history since they have no experience at all, so insurers must charge them more for coverage.

The good news is that teenage car insurance gradually becomes more affordable over time. Rates steadily decrease from age 16 until about age 25 where they remain largely consistent until your senior years. For example, premiums for a 21-year-old driver average about $916, which is a 65% decrease from the time they were 16.

Additionally, by putting your teen to your policy, whatever discounts you have can factor into your rate to reduce the impact of the overall price increase. If you got a separate policy for your teen, they wouldn’t have your discounts to help.

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The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.