As younger drivers finish up high school and either enter college or the workforce they will often have to purchase car insurance. Younger drivers face price discrimination from the auto insurance business because of their risk; however this does not mean you cannot get a good deal. As a young driver in my early 20s I I have managed to get a very good policy for my age and gender. This article is going to take a look at 5 tips for getting cheap car insurance for young drivers.
1. Look for discounts: Good Grades, Low Miles Driven, and Safe Driver
Car insurance companies have discounts for the most obscure reasons, all of which minimize the risk factor for them. If you achieved good grades in school (or are still attending) you may be subject to a “good grades” discount, which can save hundreds. Do you work only a few miles down the road? Insurance companies give discounts for low millage drivers, even at a young age. Do you wear your seatbelt, never been in an accident, and always drive the speed limit? Insurance companies reward safe young drivers by offering discounts for every year they go without an accident. Avoid speeding tickets and other moving violations like the plague if you are a young driver (or any age), or you will notice your premium sky rocket (especially true for male drivers). If you are still attending school you can get a discount for limited use of the vehicle, i.e. only driving on vacations and leaving the car at home.
2. How much insurance do you really need?
If you have just graduated from high school or college and are starting your first “real” job then you most likely do not have an expensive brand new car. When looking for a cheap car insurance policy you should only purchase what you need. As a young driver with an inexpensive car you should avoid a comprehensive insurance plan and go with a plan that covers the other driver in an accident but nothing more. You want to have a plan that will protect you in the case of a lawsuit, but you don’t want to pay $2000/year for insurance on a car that is worth $4000.
3. Don’t be gullible
I went to college for degrees in both management and economics and the sad truth is that insurance companies will try to up sell you policies to make higher commission.
At a young age insurance agents will find you as any easy target and often try to sweet talk a deal. When calling an insurance agent or going in person you should know what you want, do research to find the plan that suits your needs, and always have competitor prices (even ballpark estimates work). The best course of action is to bargain with the agent and politely tell them what the competition is offering for the same policy; as a young driver you have little wiggle room, but if you have maintained good grades and have a stellar driving record they will listen. Most agents work on commission, therefore it is in their best interest to sign you if you are a limited liability as long as there is even a small margin of profit.
4. Higher deductibles
Paying higher deductibles in case of an accident is a good money saver when you are looking to lower your premium and get cheap car insurance. If you have a bare bones insurance policy anyway then having a high deductible will not really affect you; in fact it can considerably lower your premium.
5. Can factors like where I work play a part in higher car insurance?
Believe it or not another tactic of the insurance companies is to jack up your premium if you work a risky job. The thought behind it is that you are more of a liability statistically, and the car is not always in the safest circumstances. If you do happen to work on a construction site or any job where the car has the possibility of being damaged you should try to get an insurance policy that does not cover damage on the vehicle. Statistically if you work at high risk job you will also be a high risk on the road; my best advice is to prove them wrong with good grades, stellar driving record, and no police tickets.
Personal Experience as a young driver with cheap car insurance