An individual with no driving record and no auto insurance record is considered a “new driver,” regardless of age. As exciting as it is to enjoy the open road on your own terms, providers see your inexperience as a risk. Since new drivers are more likely to be involved in an accident, you’ll have to pay a higher coverage rate. However, there are ways to reduce your insurance expenses.

Why Does Auto Insurance Cost More for First-Time Drivers?

Elevated Risk

New drivers between the ages of 16 and 19 have the highest probability of being involved in an accident. Even if an individual is in their 20s when they first become a driver, their rates will still be high due to their inexperience. Approximately 43% of first-year drivers and 37% of second-year drivers are involved in car accidents across the nation. 

Discount Ineligibility 

Inexperience precludes many drivers from auto insurance discounts. However, after five years, or after the driver’s 21st birthday, most providers offer rate reductions. 

Over time, more discounts will become available. People who are college graduates, married, or own a home or multiple cars are entitled to lower rates. Insurers see them as stable and responsible, and less of a risk. 

No Credit 

Given that most new drivers fall between the ages of 16 and 19, it’s unlikely they’ll have credit. Most young people who do have credit may not have had enough time to establish a strong history. Providers believe that drivers with low or no credit file more claims, elevating their risk level. In turn, the drivers pay higher rates. 

How Can New Drivers Reduce Their Auto Insurance Rates?

Driving Course

Upon completing a defensive driving course, submit a copy of the transcript or receipt to your auto insurance provider. The course makes you into a safer driver, which reduces your risk. In turn, the insurance company decreases your rates. 

Parents’ Insurance

Younger drivers will save the most on their auto insurance by staying on their parents’ plan. The provider looks at their background, driving history, and credit score, which will be more extensive and less risky. 

Driving Contract

Many insurers now offer driving contracts for new drivers in return for a discount. The driver must maintain their vehicle, pay any fines or tickets, maintain good grades, always wear a seatbelt, and never text or eat while on the road. 

 

When it’s time to shop around for car coverage, reach out to Absolute Insurance Agency in Foley, AL. Their agents have more than 30 years of experience matching new drivers with auto insurance plans that are comprehensive but affordable. They offer personalized packages that new, at-risk, and experienced drivers can benefit from. Using their connections with many insurers, they’ll find a customized plan with you in mind. For more information on their coverage areas, visit their website. To schedule an appointment, call them at (251) 942-6837.