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Cutting the cost of teen auto insurance

While most teens want to strike out on their own, it's a tendency they should resist when it comes to car insurance.

At high risk for traffic accidents and tickets, their rates can easily be 50 percent to 75 percent higher than older drivers', with a reduction not coming until age 25, marriage or both. They'll save money and headaches by getting their insurance as an addition to their parents' insurance policy instead of getting their own policy.

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Here are some ways to reduce the cost, courtesy of the Independent Insurance Agents of America:

  • Make sure your teen stays in school and studies hard. Some insurers offer discounts to good students, or to those who only drive during school vacations. A "B" average or better in school carries a lot of weight in keeping insurance costs down.
  • Sign up your teen for a driver's education course. Many insurers will offer a discount for this kind of investment.
  • If your teen will be driving a family car, designate one vehicle he or she will drive. Otherwise, the insurance company will price the premium based on the highest risk vehicle on your policy.
  • Consider a higher deductible. Going from a $250 to $500 or $1,000 deductible can save you 10 percent to 20 percent on your premium. What you have to weigh is whether you can absorb the out-of-pocket expense in the event of an accident.
  • Reward safe driving. More than anything else, an accident- and ticket-free driving record will keep your rates at their lowest.
    -- Updated: April 20, 2005





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