Why You Want To Keep Your Teen Driver On YOUR Policy

One of the options that parents consider in order to save money on their auto insurance, is placing the young driver on a separate policy. They think if they buy a separate policy for their teen driver, the rates for their other cars won’t go up.

Actually, that part may be true. But the flipside is that on a separate policy, the rate for the teen driver’s car goes way up for two reasons:

First, there won’t be a multi-policy discount for the single car on the teen’s policy
Second, you will have to buy a policy from a “high-risk” insurer. “High-risk” insurance companies charge rates that are more than double of a standard company.

Not only that. Placing your teen on a separate policy can cost you much more than higher rates. The most dangerous problem when insuring your teen with a high-risk insurance company is that you can’t buy high enough limits for a teen driver. The liability limits offered by these companies are usually no higher than 100/300/50, that means $100,000 per person, $300,000 per accident and $50,000 for property damage.

Some parents think that’s fine – that in case of a big claim, the other party will only sue their child’s insurance company if there’s a big claim. That’s wrong! Any good attorney will go after the parents too, as long as the child is living in the parent’s home or is a dependent. The smartest way to insure your young driver is to keep them on your own auto insurance policy, with the highest liability limits you can get.