Teen drivers are dangerous. According to the Insurance Institute for Highway Safety (IIHS) the crash rate for teens is three times higher than drivers over the age of 20 and the Centers for Disease Control and Prevention (CDC) says traffic accidents are the leading cause of teen deaths. All of these grim statistics are the reason your insurance rate will increase significantly -- in many cases premiums double -- the moment you add a teen driver. Study hard and be rewarded with a student car insurance discount
There are plenty of ways to drive down the cost of insuring your teen and one of them will not only reward your pocketbook, but it will brighten your teen's future. A good student discount, one of the few car insurance discounts aimed at young drivers, puts the discount squarely in control of your teen -- if he studies hard your rates will drop. Your teen must have a valid driver's license to qualify; learner's permits don't count. According to Glenn Greenberg with Liberty Mutual, "A teen with a permit is automatically covered under their parent's insurance. On the day the teen receives their license and is driving on his or her own, the driver would need to be added to the parent's policy and would become eligible for the discount." Unfortunately, older students are out, so if you are headed back to school for your M.B.A., don't expect your insurance rates to drop. Age limits vary but in most cases the good student discount only applies to students under 25. What's it take to be considered a good student in the eyes of an insurance company? According to Loretta Worters with the Insurance Information Institute, in almost all cases it takes a "B" (3.0) average to qualify for a good student discount. Your insurer is not going to take your word for it when it comes to Junior's grades. "You will need to provide documentation from the school," says Worters.