Adding a teenage driver to your auto insurance policy can be
expensive, but failing to do so could cost you money down the line
if there is a dispute over coverage.
In the rush of day-to-day living, it's easy to understand how
you might delay adding a teen driver in your household to your
policy. Perhaps it slipped your mind, or maybe you were trying to
save money. The good news is that insurance companies generally
will extend coverage to accidents caused by teen drivers who have
not been added to their parents' policies.
However, not all
car insurance companies
are equally understanding.
If your teen obtained a license before you renewed your auto
insurance policy and you failed to tell your insurer, this could be
considered misrepresentation and the company could be entitled to
deny coverage, according to the Insurance Information Institute
(III). In some cases, insurance companies may honor claims
involving unlisted teens, but charge you for back premiums to cover
the time that the driver was licensed but not formally on your
policy, says Rick Ward, director of auto claims for MetLife Auto
"Others may forgive it," Ward says. "The best advice you can
give is always notify your insurance company when you have an
additional driver on the policy."
Car insurance policies normally state that "you are to notify us
of any additional drivers or additional risks," Ward adds. "Some
carriers may have an exclusion in the policy that says, 'If you do
not notify us we will not cover you.'"
State auto insurance requirements
The insurance industry does not track how often teens are left
policies, but it is not a common occurrence, says III spokesperson
That is partly because policyholders frequently are reminded by
insurers, who are aware when household members are about to reach
driving age. Some states even allow insurance companies to require
you to list teens with driving permits on your insurance policy.
Those include Illinois, Indiana, Maryland, New York, North
Carolina, Ohio, Pennsylvania, Virginia and West Virginia. It is not
unusual for insurance companies to automatically begin billing for
additional drivers as soon as young household members are old
enough to drive.
Teen car insurance rates
According to the insurance institute, adding a teenager to your
auto insurance policy can result in a hefty cost increase of
between 50 and 100 percent.
car insurance rates
are higher because traffic accidents are the main cause of death
among young people in the United States. Drivers between ages 16
and 19 have the greatest number of accidents and safety violations
of any age group. The National Highway Traffic Safety
Administration reports that 2,739 drivers between the ages of 15
and 20 died in motor vehicle crashes in 2008. To reduce accidents
among teen drivers, most states have adopted graduated drivers
license systems, in which teens gradually receive full driving
privileges as they gain experience. Fatalities among teens have
dropped 20 percent since 1998.
Ward says another developing trend is for teens to wait several
years beyond their 16th birthday before getting a driver's license.
When your teen begins driving, Peter Moraga, spokesperson for the
Insurance Information Network of California, says you should ask
your insurer about discounts for such things as good grades or the
completion of safe-driving classes.