Expert Insurance Tips for First Time Drivers

People argue about the right time to list drivers, whether a newbie or a fairly mature one, on an auto insurance policy. Do you need to register your undertrained son who only has a learner’s permit? Do you need to get insurance in the name of a close friend who often borrows your vehicle for personal usage?

Well, your insurance policy is determined in parts, mostly concerning the driver of the vehicle. Questions jotted down above raise more arguments in mind, all of which will be covered in detail. To give you a rule of thumb, if your vehicle is being used by any person on regular basis, he must be added as a driver in your insurance policy. In any case, your insurance provider should be cooperative enough to explain such scenarios to you and resolve your queries.

A teen driver with a learner’s permit

There is an exception to the general thumb rule, the exception being a teen driver with a learner’s permit. You don’t need to register him on an insurance policy as a driver until he/she has graduated to the license level. At this stage, the law allows this person to drive without a guide/trainer. Once your teen driver has reached that stage, make sure that he/she is added to your policy.

A teen driver living with a parent

In a scenario where a teen driver is living with a single parent and generally doesn’t drive the car, you don’t need to list them as a driver on your insurance policy. However, if you have an arranged living situation where the young driver is splitting living time with both parents, you need to get him/her registered to cover any possible claims. In such situations, both parents’ insurance providers will share the premium amounts to reflect the young driver’s living arrangement.

A neighbor borrowing your car

As far as occasional usage of your car by your neighbor or a friend is concerned, you might already know the answer which is that you shouldn’t register them in your policy. However, if you are lending your car then practically, you are lending your auto insurance policy too. So, one should be careful enough to lend their car to selective drivers with valid drivers’ licenses and clean history.

Tips to reduce car insurance cost

Third-party insurance cost

As the name suggests, a third-party insurance policy offers less form of coverage than comprehensive insurance and hence, it should be a bit cheap than other policies. However, it isn’t always the case so, you should be vigilant in analyzing and comparing all available policies and cost to be incurred.

The rationale behind this theory is that as an insurance provider, you profile your clients with third-party insurance as a much risky client than others. Therefore, the insurance provider maintains a cushion for such a client to cover that risk.

Adding multiple individuals in an insurance policy

Typically, adding another driver should raise the premium costs, yet it depends on that particular scenario. For instance, we have studied cases of insurance and noted instances where a much older and experienced driver was added as a part-time driver to a teen’s auto policy, and a substantial cost saving was witnessed. As a thumb rule, you should note that by adding a low-risk driver to a young and riskier driver’s policy, you can make car insurance costs for a new driver to an acceptable level.

Getting quotes

We can say with experience that insurance providers respond in different fashion depending on the way of approaching them. Your mom may get a higher quote from the same insurance provider while your uncle may get a discount. It's all about the way of dealing with your agent. Ideally, the market should be researched thoroughly and a comparison of different quotations must be done before the final selection of an insurance provider.

Car insurance 23 days ahead

We have done some research and the numbers tell us that the best time to renew your insurance policy is 23 days ahead of its defined renewal date. Although the impact may not be a significant one but still, who doesn’t like to save some extra bucks.

The closer you get to the renewal date, the more chance of you being profiled as a risker client and hence a higher premium cost. Each passing day will add to the renewal policy cost as the service provider will see you as a disorganized client.

Make yourself attractive to insurance companies

The goal is to minimize the premium cost. Right? Well, you need to understand this from an insurance company’s point of view and how they work. Insurance companies analyze the risk associated with a prospective client and this risk analysis is usually done by actuaries. To save big on premium costs, you need to present yourself to the insurance provider as a low-risk or medium-risk client. The less risky you are profiled the more attractive you will be to the insurance provider as a client. Eventually, this will impact your premium cost and save you quite some money.

Never auto-renew your policy

Auto-renewal of insurance policy is usually very expensive as insurance companies tend to bait the loyalty of a client and prey on it by charging a fixed amount each year. You won’t receive a justification of that renewal figure which will surely be on the higher side than the market. They keep on increasing policy charges each year knowing that most clients don’t want the hassle of switching to new insurance providers. 

Our tip for you will be jotting down the date of your policy renewal and conducting online market platforms for better rates. Compare the rates being offered by insurers and then make a bargain by calling your agent to see if he can beat that.

Final thoughts

For first-time drivers, getting the right insurance policy as well as keeping the cost-effective part to an acceptable level, is of utmost importance. Get multiple quotes, carefully analyze, choose the best available insurer and be smart about it.