For a lot of students, driving is their first real taste of freedom. While there’s nothing quite like hitting the open road on your own for the first time, this freedom comes at a cost.
It shouldn’t come as any surprise, but students, specifically young drivers, pay among the highest auto insurance rates. While it many seem unfair, young drivers are more likely to be involved in a collision. The reasons for young drivers getting in an accident is twofold – less experience behind the wheel and a higher likelihood of taking risks.
Here are some of the facts students should know about auto insurance.
Some auto insurers offer student discounts. If you’re living in a college or university residence and seldom drive, you could get a break on your auto insurance rates since you’re less of a risk.
Similar to adults, auto insurers can offer students discounts when they bundle insurance. For instance, if you're a student moving away from home, and purchase renters insurance you might qualify for a discount by bundling your auto with your renter's insurance.
It is commonly believed that your insurance rates drop when you turn 25. Typically, a 19-year-old driver will pay more than a 24-year-old driver, with all other variables being equal. Younger drivers have less experience and therefore pay more for coverage. As you acquire more driving experience and maintain a clean driving record, you could pay less.
How much more can you expect to pay as a young driver? There is no industry standard for exactly how much your age impacts your premiums as different providers weigh your age differently. It's therefore encouraged to shop around and obtain a few quotes.
Do you seldom drive? Don't need your own vehicle? If you answered yes to either of those questions, then it might make sense to piggyback on mom and dad’s auto insurance policy and become an occasional driver.
Make sure that you check with your auto insurer to understand what's considered an occasional driver. Generally speaking, an occasional driver is a person who is not the primary or principal driver of any vehicle in the home. By becoming an occasional driver instead of buying your own policy, you can save a lot of money each year on your auto insurance premiums.