If you are a parent of a teenager who will soon receive their driver's license, you may be wondering if adding your child to your auto insurance policy will affect your payments. In fact, you will likely see an immediate rate increase. That is not an indictment of your teen's driving ability. Rather, your insurer is simply playing the odds. Below is a more in-depth look at how your teen driver will affect your auto insurance premiums.

Why Teens Cost More to Insure

Teenagers are more expensive to insure for two primary reasons. First, they are inexperienced drivers. Second, as a group, they tend to engage in riskier behaviors.

For example, teens are often easily distracted by digital devices and passengers, and are, as a result, disproportionately involved in auto accidents. In 2016, teens cost insurers $13.6 billion in damages and injuries. Of course, over time, they will gradually accumulate experience and learn how and when to anticipate trouble. Thus, when they reach age 25, they will see rate decreases and pay prices commensurate with your own.

How to Save Money on Teen Auto Insurance

You can reduce the cost of car insurance for your teens using several methods. First, add them to your policy instead of getting them one of their own; it's normally cheaper this way.

Also, have your teen take an approved defensive driving course. Successful completion could result in a discounted rate. Lastly, encourage your child to get good grades in school. Insurers have found a correlation between academic success and safe driving habits, so they often offer discounts to kids who earn a place on the honor roll or dean's list. 

To see if you can lower your premium rates on an auto insurance policy that includes your teen driver, contact Alvarez Insurance Agency in Omaha, NE. They have been serving clients in and around Douglas County for more than 15 years. They specialize in auto, motorcycle, homeowners, and renters insurance and take pride in their high-quality customer service. Visit their website to submit an information request, or call (402) 733-1878 for an insurance quote.