Car insurance with car key

How Much Should Parents Spend on Car Insurance?

It’s cheaper to add your 16-year-old son or daughter to your car insurance, instead of buying a separate policy. However, the additional cost will still be high based on different factors.

Your location affects the actual cost. If you live in Illinois, the rate of premiums vary for young female and male drivers depending on where you live in the state. In Chicago, auto insurance companies generally charge more for adding teenage boys since they are more likely to become involved in an accident compared to young girls.

Calculating the Expenses

A couple in their 40s with one teenage son and two cars can expect to pay around $4,680 for a six-month policy. While this is a significant jump from paying almost $1,400 for the same period, it’s still more affordable. Separate policies for teenage drivers usually cost roughly $6,000 on average for six months, whether it’s for boys or girls.

Take note that your own driving record can also affect the rate for adding a dependent. Some insurers might not accept high-end vehicles even if you can pay for its insurance. Some models can cost less to insure such as the Honda CR-V, which is around 33% lower than a Ford Mustang. You should also be aware of different rules involving teenage drivers before planning to buy insurance.

Rules and Regulations In Illinois

Parents should make sure that their teenage driver’s coverage costs a combined $95,000. This comprises $25,000 of physical injuries per person, $50,000 for bodily injuries per accident, and $20,000 for property damages per accident. Your child shouldn’t be driving the car between 10 p.m. and 6 a.m. from Sundays to Thursdays and from 11 p.m. to 6 a.m. during Fridays and Saturdays.

Illinois imposes a fine of up to $1,000 for people who drive without insurance for the first time, aside from a having a suspended license for three months. You can ask for a reduced penalty when you already bought one for your child before the court trial. If you fail to do so, the judge can also suspend the vehicle’s registration until the offender has insurance and settled the penalty charges.

How to Save Money

Signing insurance policy

Some insurance companies provide discounts for teenage drivers’ policies. For instance, parents of a full-time high school student with a GPA of 3 or above can pay for a reduced rate. You can also avail of a driving tracker, which monitors the activity of your child each they use a car. Once the kid has proved to be a safe driver, the insurer can adjust the premiums.

These conditions might apply to drivers up to 25 years old. Another way to save money requires your child to complete a road safety and training course, while some insurers can also reduce the amount if you pay the full price up front instead of monthly installments.

Remember that car insurers have different parameters when setting the rate for young drivers. When choosing a provider, you should request for at least three quotes from different companies for a more comprehensive comparison.