Question: Until my twins are 18, I plan on allowing them to drive only if I’m by their side so that I don’t have to pay for them to be on my auto policy. Would this work to save money on car insurance?
Answer: While your idea to allow your teen drivers to only operate your vehicles if you’re by their side may make them safer drivers, it doesn’t necessarily mean that you’ll be able to save money on car insurance. (See “Do insurers automatically add teens to your policy?”)
The rules and guidelines of insurance companies vary. Some allow young drivers with just a learner’s permit to be covered by your policy without being added as a driver. Other auto insurance providers require you list even those with a permit -- and pay for them to be drivers.
To find out what your car insurance company mandates, contact your agent before your children even receive their permits. This way you can find out when your insurer requires your teenagers to be added to the policy at the permit or license stage and get an estimate of the cost. (See “A parent’s guide to insuring a teen driver”)
If you find that your auto insurer will let you keep your young drivers off the policy as long as they’ve only received their permit, then see if there is any time limit – by either the insurer or the state.
For instance, if your state requires a novice driver to carry the permit for only six months but you plan on your teenagers carrying it for two years, then your insurer may at some point note that your children have carried a permit for a lengthy period of time and ask you to add them as drivers to your policy.
And in regards to the state, there is likely an expiration date for the permit. In some states you just pay a fee to renew a permit, but in others your teen drivers would need to apply all over again for the permit – meaning paying fees as well as retaking any required tests.
If part of your plan is to let your children continue with the licensing process, so that they can obtain their intermediate and then full license, you’re definitely going to have to add them to your policy as they proceed through the graduated licensing system – even if you plan to continue to be sitting in the passenger seat as their permanent supervising driver.
All auto insurance companies will require that you add your teenagers who are licensed and driving your cars. And, as you apparently understand, this will make your car insurance rates go up – a lot. (See “What a teen does to your car insurance rates”)
The auto insurer may be happy that you'll continue to guide your children and never let them drive alone until they are 18, but there is no way for you to prove that to them. Insurance companies deal with a lot of fraud, so it’s not going to be able to take your word that the teens won’t drive alone to cut you a deal on their premiums.
Unfortunately, there is not yet any discount for having twin drivers (I sadly say as a parent of twins myself); however, there are ways to save money when you have teen drivers. See about getting discounts or lower rates due to:
- Your young drivers getting good grades in school and obtaining good student discounts. It can be substantial.
- Completing a driver’s safety course or accident prevention class.
- Having a clean driving record. With you driving with your teen drivers constantly, it should hopefully keep them from receiving tickets or being in accidents --both things that would make their rates go even higher.
- Assigning them as secondary drivers to cars if there are more cars than drivers in the household.
- Signing up for a pay-as-you-drive plan. Your insurer will monitor the driving of all drivers to determine if you’re eligible for discounts. Also, knowing that you’re being watched has said to improve drivers’ skills behind the wheel.
- Picking the right car for them to drive. See our choice of best used cars for teen drivers.
Also, shop around. Your insurance company may charge more for teen drivers than other auto insurers in your area. By shopping around for rates, you may save hundreds, if not thousands, on your car insurance premiums.
If you truly can’t afford the cost of your teen drivers right now, you may need to have them wait to get licensed until it’s financially viable (such as they work and pay for their own portion of the policy).