Guide to Adding Your Child to Your Car Insurance

More than 60% of teens have their driver’s license before the age of 18, according to 2019 data from the AAA Foundation for Traffic Safety.^[1] And roughly 5% of drivers are between the ages of 15 and 20.^[2]

While getting a driver’s license is a major milestone for young people, it also presents some challenges for parents. In addition to navigating your teen learning to drive, you must also think about insurance costs. While it may be possible for your teen to get their own policy, it’s usually easier — and cheaper — to add them to your policy.

Costs of adding a young driver to your car insurance

It probably comes as no surprise that adding a teen driver to your car insurance can cause your premiums to spike significantly. After all, age is one of the most important factors that affect auto insurance rates.^[3]

Young people are generally more likely to cause car accidents than older drivers and are more likely to be involved in fatal accidents.^[2] The risk is particularly high for young male drivers, who are about three times as likely to die in a car accident as are young female drivers.^[4]

Unfortunately, there’s no way around these added costs when you add a teen driver to your policy, even if you find ways to save money. Parents should shop around to find the insurer that offers the best rate for families with young drivers.

“The cost varies greatly for each insurance company,” says Camron Moss, an insurance broker with A Plus Insurance. “You can be confident, though, that by adding a young driver to your policy, it will be significantly cheaper than if they had a policy on their own.”

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Costs of adding a young driver by insurance company

Adding a teen driver to your insurance policy can increase your premiums, but the amount of the increase is important to know. For example, adding a young driver to your Nationwide car insurance policy can increase your rates by 226% on average, while adding a teen to a CSAA car insurance policy can increase rates by only 64% on average.

The table below shows the average monthly quote before a teen driver versus after a teen driver for 16 top insurers.

Check Out: How Old Do You Have to Be to Drive in Each State?

Do you have to add your child to your car insurance?

With the higher premiums that come from adding a teen driver, you might wonder whether it’s really necessary to add them to your policy at all.

Car insurance companies may use your household rating to determine your car insurance premiums. An insurer might ask you to list every driver you live with who may drive your car, including any teen drivers, to get an accurate picture of your risk. Depending on your state, you may exclude certain drivers from your car insurance policy, but it’s a better idea to include them. 

“If they are not on your policy and they are the cause of an accident, you risk having a claim denied and may be responsible for paying out of pocket,” Moss says. “You want your child to enjoy the same protection as you do.”

However, that doesn’t necessarily mean you must add your teen driver to your policy. It’s possible for a teen driver to get their own policy.

Whether you decide to add your teen to your insurance policy may depend on a couple of factors, including cost. Your teen’s premiums are likely to be lowest if you add them to your policy rather than having them sign up for their own, according to Moss.

“As inexperienced drivers, teens may face higher insurance premiums on their own,” Moss says. “You’ll have peace of mind knowing that your teen is protected under the same policy as you.”

Not only will your teen driver benefit from being on a policy with one or more experienced drivers, but you may also be eligible for more discounts that can help mitigate the cost.

When your child should get their own car insurance

Unlike with health insurance, there’s no set age at which a young driver can no longer be on their parents’ car insurance policy. However, that doesn’t mean it’s best for them to remain insured under your policy indefinitely.

First, most insurance companies require that insured people on your policy live in the same household. There are exceptions for students away at college. But once your child moves out on their own, they’ll usually have to get their own policy.

Your child may also need to get their own policy if they have a car registered and titled in their own name. Some insurers require the primary name on the insurance policy to match the name on the vehicle.

Finally, you as the policyholder might decide to remove your child from your insurance policy before they move out or get their own title if they haven’t shown they can drive responsibly. After all, if your child has caused accidents or received moving violations, they could significantly increase your insurance premiums or even cause you to lose your coverage altogether.^[5]

“As a parent, you have the power to decide whether or not to keep your teen on your policy,” Moss says. “If your teen is irresponsible with speeding tickets or accidents, you can choose to remove them from your policy.”

Pros and cons of adding a teen driver to car insurance

When you’re deciding whether to add your teen to your car insurance policy, consider these pros and cons.

How to add a teen driver to your car insurance policy

Are you preparing to add your teen driver to your car insurance policy? Here’s what you’ll need to do:

1. Contact your insurance company. Depending on your insurer, you may be able to add a teen to your policy on either the company’s website or mobile app. You’ll need to provide information such as the driver’s name, date of birth, Social Security number, and vehicle information.

2. Rethink your coverages. While you’re adding your teen to your policy, you may want to consider increasing your coverage. If you’re concerned about your teen causing an accident, you may want to increase your liability coverage.

3. Pay your new premium. If you pay your premiums month to month, you’ll notice your next month’s premium could be higher than you’ve been paying. But if you pay your premiums up front, you may need to pay the full added amount right away.

4. Get your teen’s insurance card. Nearly every state requires drivers to carry car insurance, and your teen will need proof of coverage in case they get pulled over. Make sure they either have a digital or paper copy of their insurance card.

How to lower car insurance costs after adding a teen driver

Adding a teen driver to your car insurance policy is almost certainly going to increase your rates, but you can take some steps to save a bit of money in the process.

Adjust deductibles

Your deductible is the amount you pay out of pocket for a claim before your insurance covers the rest, up to your coverage limits. Generally speaking, the higher your deductible, the lower your premium. Therefore, you can save a bit of money by increasing your deductible.

Just make sure you don’t increase your deductible so much that you can’t afford it. Keep your deductible low enough that you can afford to pay it if you or your teen is in an accident.

Look for student and teen driver discounts

Many insurance companies offer discounts specifically tailored to young drivers. For example, many insurance companies offer a discount for students with good grades. Others offer discounts for students on your policy who are away at college. Finally, some insurers may offer a discount if your teen takes an approved driver safety course.

Another discount you may be eligible for — though it’s not specifically made for teens — is a multi-vehicle discount. Most insurers offer a discount if you have more than one car on your policy. So if your teen has their own car, you may be able to save a bit of money that way.

Consider usage-based insurance

Depending on how much your teen drives, you might consider usage-based insurance. Many insurance companies offer optional usage-based programs that drivers can enroll in to save money. You often get a small discount immediately just for participating.

Once you enroll in a usage-based program, your insurance company monitors your driving habits using either an app or a GPS device installed in the car. The safer you drive, the more you can save on your insurance policy.

Another type of usage-based insurance is pay-per-mile insurance. As the same suggests, this type of insurance charges a base rate plus an extra fee for the number of miles you drive per month rather than charging just a flat monthly rate. Pay-per-mile insurance may be appropriate if your teen doesn’t drive often.

Buy them a safe car

One factor that insurance companies use to set insurance rates is your vehicle. The safer your vehicle, the lower your premium may be.^[3]

First, an insurance company may consider the crashworthiness of a vehicle. The better the vehicle’s crash safety ratings, the more you save. The Insurance Institute for Highway Safety (IIHS) compiles vehicle safety rankings, and you can search by make and model to find out how safe a car is.

Many insurance companies also consider a vehicle’s safety features. For example, insurance companies often offer a discount for anti-theft devices since they reduce your chance of having your vehicle stolen. Other features that may save you money are those that reduce your risk of a crash. Safety features may include lane assist, forward-collision warnings, and automatic braking.

Learn More: What Are the Best Cars for Teens to Drive?

Promote safe driving for your teen

Ultimately, the best way to keep your insurance rates low is for your teen to be a safe driver. Someone’s driving record is one of the most important factors that affect their insurance rates.^[3] If your teen has an at-fault accident or another violation on their record, your rates are likely to increase.

Not only can safe driving help you avoid a rate increase, but it can even decrease your rates. Many insurance companies offer discounts for drivers who go a certain amount of time without an accident or major violation.

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Adding a child to car insurance FAQs