It isn’t easy for a young person to get reasonable car insurance rates for several reasons.
That is why it is worth paying attention to find all the discounts you can get to bring the premium to an affordable level.
Also, it is very important to know what is acceptable and what can be seen as misleading practices by loss adjusters and insurers in case of a claim. Let’s have a look at several scenarios to help students out.
Firstly, youngsters are considered very high risk because they are inexperienced, excitable and like to take chances behind the steering wheels.
Usually, rates come down a bit at the age of 21, but they come down to the same levels as every other age group at 25. And the rates can be at least twice higher at 16 in comparison to 25.
There are so many other discounts youngsters miss as well. Naturally, they cannot build much of a credit history when everything is paid by parents and cannot claim as much as a 20% discount for good credit score from some companies.
They are unlikely to own their home at college age or be married. So, they lose out on homeowner and marriage discounts.
Getting Auto Insurance Discounts
It may appear that a good student discount is the only one a college student can claim but this really isn’t the case. There are plenty of discounts offered as shown below.
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Leaving the Car at Home:
Legally, parents’ home is still the home of college students. If they registered their automobiles at home, they are probably getting a good rate by association to their parents, providing they get the coverage from the same vehicle insurance company.
Also, they can ask for further rate cuts because their automobiles would be sitting there while they are at college, where they spend most of the year.
Their insurance company could either take their word for it or set a mileage limit to qualify for the discounts. There are other solutions to be discussed below.
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Being Insured by Parents:
Regardless of parents insuring the child’s car in their name (by clearly stating that the vehicle is mostly used by a youngster) or under their own car insurance, they can ask for discounts for a child at college.
Most companies have no problem with offering large discounts in such cases, especially if the college or university is at least 100 miles away.
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Taking the Car to the Campus:
Once the decision is made to take the car to the university, it is unlikely that you can keep the insurance address as your parents’ home or remain insured by them.
Most companies would insist that you change your address and arrange a policy on your own the moment you tell them that you are now at a college. And you will need to tell such a material fact to them to make sure you don’t have any problem if you have a claim.
The good news is that there are automobile insurance companies offering great rates for students living on campuses, simply because those students don’t really travel much.
They attend lectures, study, eat, socialize and sleep in the campus, which is a pretty safe and contained environment and certainly away from main city traffic.
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Telematics Insurance:
When you have no insurance, driving or credit history to show for, you could opt for a policy which allows you to show how your driving is. Telematics policies are based on installing a little monitoring device on the insured vehicle to monitor the driving habits and mileage.
These are perfect for young and high-risk drivers because they can get as much as 20% discounts just for agreeing to monitoring. And if they aren’t traveling late at night or early in the morning, slamming on the brake hard every so often or traveling long distances, they can get a lot more discounts.
The best part of being a student is that everybody knows they don’t have much money, and therefore there is no shame in asking for discounts and ways to save money. Surprisingly enough, auto insurers or agents would find ways to help them out if they ask nicely.
other related articles of interest:
Shopping Insurance
Whatever they do, they should never buy car insurance without shopping around properly. Usually, there can be huge differences in quotes between two companies.
This gap opens up a lot when the applicant is considered high risk. It is no joke that the price difference between the cheapest and most expensive quote can be as much as three times, especially when the applicant is a teenager.
That is why it is essential to shop around until you find reasonable vehicle insurance rates or exhausted all the avenues. It shouldn’t take long for a young person to find a comparison site online and start getting a few quotes.
It is best that you don’t drop any coverage before you know you cannot afford the coverage you desire. See if you can get what you want at a reasonable price. If not, you can always go for the second or third round of quotes with reduced coverage or increased deductibles.
Image Credit: by envato.com
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DECEMBER: collection aid information for FAFSA (part of HS college calendar)
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