7 Ways to Make Teen Car Insurance More Affordable

by Ryan Ruffcorn

Watching your teen start driving is both exciting and nerve-wracking. While they gain independence, parents often face another challenge—rising car insurance costs. Since teen drivers have limited experience, they are considered high-risk, leading to significantly higher premiums.

Fortunately, there are smart ways to reduce these costs while ensuring your teen has the right coverage. This guide outlines how teen car insurance rates change by age and provides seven effective strategies to lower expenses when adding a young driver to your policy.

How Car Insurance Rates Change by Age

Teen drivers face some of the highest insurance rates due to their inexperience. Here’s a look at average annual car insurance costs based on age:

16-19 years old – $2,999
20-24 years old – $2,040
25-29 years old – $1,707
30-34 years old – $1,591
35-39 years old – $1,610
40-44 years old – $1,603
45-49 years old – $1,478
50-54 years old – $1,284

If a teen gets their own policy, their premiums will be even higher. On average, a standalone teen policy costs $2,267 per year, while adding them to a parent’s policy increases the premium by about $621 annually—a much more affordable option.

7 Ways to Reduce Teen Car Insurance Costs

1. Talk to an Insurance Agent Before Adding Your Teen

Before making any decisions, consult with an insurance agent. They can:

Explain the costs of adding a teen driver.
Find discounts you may not be aware of.
Help adjust your policy to minimize costs while maintaining proper coverage.

Since every insurance provider has different rules, getting expert advice ensures you’re not overpaying.

2. Assign Your Teen to the Least Expensive Car

The type of vehicle your teen drives significantly impacts insurance rates. To save money:

Assign them to the cheapest and safest vehicle on the policy.
Choose a car with high safety ratings and lower repair costs.
Avoid sports cars and luxury vehicles, as they lead to higher premiums.

Let your insurance provider know which car your teen will be driving. Otherwise, they may default to assigning them to the most expensive vehicle on the policy.

3. Encourage Safe Driving Habits

Insurance companies track driving behavior, and accidents can increase premiums. Teach your teen:

The dangers of distracted driving, including texting or using a phone.
The legal and financial consequences of driving under the influence.
Basic safe driving practices, such as obeying speed limits and using seat belts.

Safer driving means fewer claims—which helps keep insurance rates lower over time.

4. Enroll Your Teen in a Defensive Driving Course

Many insurance companies offer discounts for teens who complete an approved defensive driving course. These courses teach:

Accident prevention strategies
Emergency driving techniques
Traffic laws and safety best practices

Check with your insurance provider to see which courses qualify for discounts. In addition to lowering premiums, defensive driving courses can improve road awareness and confidence behind the wheel.

5. Take Advantage of Good Student Discounts

Many insurance companies reward good students with discounts. Typically, your teen qualifies if they:

Maintain at least a B average (3.0 GPA or higher).
Are a college student living 100+ miles away without a car on campus.
Only drive during school breaks and weekends.

Encouraging strong academics can not only benefit your teen’s future but also help you save money on car insurance.

6. Increase Your Deductible to Lower Premiums

A higher deductible means lower monthly premiums. Before increasing your deductible, consider:

Whether you have enough savings to cover a higher out-of-pocket cost in case of an accident.
If your teen is a cautious driver, reducing the likelihood of frequent claims.

If financially feasible, raising your deductible can be a simple way to cut insurance costs.

7. Lead by Example – Be a Safe Driver Yourself

Teens often mirror their parents’ driving habits. If they see you engaging in safe driving behaviors, they are more likely to do the same. Set a good example by:

Obeying speed limits and traffic laws.
Avoiding phone use while driving.
Always wearing a seatbelt.

A clean driving record helps reduce long-term insurance costs, benefiting both you and your teen.

Keep Teen Car Insurance Affordable

While adding a teen driver to your policy increases costs, these seven strategies can help you reduce expenses while maintaining proper coverage. By consulting with an agent, choosing the right vehicle, encouraging safe driving, and taking advantage of available discounts, you can make teen car insurance more affordable.

Muntz Insurance is here to help. Our team can assist you in finding the best coverage at competitive rates while ensuring your teen is protected on the road. Contact us today to explore your options and start saving on teen car insurance.