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By Mike Causey

One thing most parents know all too well is when their teenage children get their driver’s license, they’ll see an increase in their automobile insurance premiums.

Why? Insurance companies consider teens a higher risk because inexperienced drivers are more likely to get into an accident. According to the Centers for Disease Control and Prevention, the risk of motor vehicle crashes is higher among 16-to-19-year-olds than for any other age group.

Let’s look at an example of a six-month policy for full automobile insurance coverage, which would cost mom and dad $991. Add a 16-year-old driver to the policy, and the family would have a $1,730 bill. If that teenager got into an automobile accident, the family insurance premium could likely climb to $2,094 or more.

The point I’m trying to make is that teenagers can save hundreds of dollars by having safe driving records compared to other teens who get into at-fault wrecks or have moving violations.

Having automobile insurance is important for several reasons:

• It’s the law. In North Carolina, you are required to have automobile liability insurance to legally drive. Most banks and finance companies also require collision and comprehensive insurance if there is a loan on the vehicle.
• It helps protect you financially.
• It helps pay for medical expenses and property damage if you’re in a crash. Without insurance, you have the potential of being sued directly for the damage or injuries you caused.

If you drive without insurance, you could be ticketed and fined, your vehicle registration could be suspended and your vehicle could be impounded.

Other things that could affect your insurance premium include your driving experience, driving record, where you live, the kind of car you drive and how much you use your vehicle.

Having a clean driving record can help you save money. Having at-fault accidents or moving violations, such as a speeding ticket, will cause your premium to go up. It may help to shop around insurance companies to see if you can get a better deal. Prices may vary from company to company. When shopping around, make sure you’re doing an apples-to-apples comparison.

If you are a parent of a teenage driver, your child’s safety is of utmost concern. You can’t always be by their side, but there are some things you can do to help keep them safe.

One thing you can do is educate yourself and your teenager about the risks and insurance implications of unsafe driving. Driving safely saves lives and saves money.

Another effective tactic is to set clear rules for your teen driver. Research suggests that parents who do so can cut accident risks in half. Talk openly to your son or daughter about your expectations regarding their behind-the-wheel behavior.

Finally, you may wish to get your teen driver to sign a contract with you regarding their driving behavior. You can find a sample contract at: insureuonline.org/teen_driver_certificate.htm.

Safe driving can save you money on your insurance premium. More importantly, it can save lives.

Mike Causey is the insurance commissioner for North Carolina.

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