Affordable Automobile Insurance

About 10 million drivers so far have named a second driver on their insurance policies. About 2.5 million of these are their own children and their average age has increased from 25 years to 31 years. These figures indicate to what extent the young adults are relying on their parents for financial support, the main reason being the current economic meltdown.

Earlier research had suggested more adults in the age group of 18 to 24 years were returning to live with their parents or have postponed plans to move out. While these young adults are staying with their parents for longer than usual, they are also utilizing their parents’ insurance policies for longer because of lack of affordable automobile insurance options.

Young drivers are required to pay higher insurance since they belong in high risk category. They are, therefore, finding a way around the problem by getting themselves named as second driver in their parents’ insurance policies. It is a legal practice for young adults to be named as second driver on their parents’ policy. It’s just that the child in question should not be the main driver of insured car.

Young drivers are increasingly finding it difficult to keep their cars on the road due to increasing petrol prices, insurance premiums and other costs. It can be concluded that many are indulging in practice called “Fronting”. In this practice, young adults buy their own cars under their own name but the insurers are told the parent is the main driver. As recession has unfolded on the economic horizon, fronting cases are on the up. The cost of this illegal activity is ultimately borne by consumers themselves.

Many young drivers are taking this cost cutting to another extreme. They are not getting insurance for their car at all. Others are taking the middle path and they are opting for the more affordable “Third Party Cover”.

When a teenager receives his or her driving license for the first time, it’s a time to celebrate. The first thing that comes to the mind is how quickly they can jump behind the wheel. Getting affordable insurance rates is something that occurs to them last. Finding affordable automobile insurance for teens is difficult (not impossible), and it requires a strategy.

Insurance company officials look at teenagers as an extremely high risk group due to reasons such as inexperience and they don’t have a record. That’s the reason they have to pay higher insurance premiums. Statistics are also against teenagers, as accident data shows young people are more irresponsible while driving their cars. A study by Illinois Department of Insurance says that above 60% of teenagers involved in accidents were also guilty of drinking. The teenagers need to understand, they need to be responsible drivers after getting their driving license. If they do not manage to avoid accidents and violations; their insurance premium will only increase in future.

There are several ways in which young drivers can reduce their insurance costs. The first obvious step is to shop around for the cheapest rate in the market. If the young drivers can club themselves in the existing policy of their parents, they can reduce insurance costs substantially. Keep an eye open for discounts. Student discounts are very popular among the teenagers. Even those student who have had good grades in their report cards, are seen as responsible drivers. Other teenagers can enroll themselves for safe driving courses which will be beneficial when insurance premium is being calculated. Even for parents, safe driving course is a great idea because it reduces accident and insurance rates at the same time. If the teenagers lean driving from a professional, they are likely to look up to him and continue with safe driving practices, even at a later stage.