Posted July 1st, 2015 by Ashley Kane
Several years ago, the practice was standard. As soon as teens turned fifteen or sixteen, they eagerly went to get driving permits and usually obtained a driver’s license as soon as legally possible. Of course, this is still standard in some areas of the country, particularly in the suburbs, but there is a changing trend as more and more individuals wait to get their driver’s licenses.
The reasons are both numerous and practical. For teenagers that grow up in cities, they likely won’t bother getting a driver’s license because there’s no valid purpose to. With ample public transportation, the priority of a driver’s license decreases for good reason. Imagine learning to drive in NYC and then getting hit with a high insurance premium for such a risk-heavy location - not worth it.
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Josh Reed from Boston, MA chose to wait to get his driver’s license mostly due to a hectic schedule. “I was really busy in high school and didn’t want to pay the $400 for a driving class. In college everything was within walking or biking distance and I just used public transportation.”
Yet what happens when your driving becomes a necessity and you eventually decide to attain your driver’s license and buy your first vehicle? Without a driving history and with the added unhelpful label of “new driver,” car insurance rates can be steep. If you recently started driving, there are steps you can take to bring your premium down.
What Can I Do?
- Age Can Be a Benefit
If you’re 25 or older than you may receive an automatic reduction on your premium. Typically, carriers charge more for younger drivers but then reduce premiums when drivers turn 25, and again at the age of 30. This generally happens due to perceived maturity. Drivers who are at least 25 are often more settled into their lives with steady jobs and income, making them assumedly more responsible drivers. Of course, without a driving record your carrier may still charge more for your inexperience but you can ask about reductions and be sure to tell them your age. Gender also plays a role, as women are statistically more cautious drivers than men. However, be aware that not all states are able to use this type of data to determine your rates.
- Shop Around
Always compare rates. Depending on your location, type of car, model, and safety features, car insurance providers will determine different rates for your situation. Your best option is to compare a few quotes to see who offers the most value. Then be sure to research possible rates a minimum of once a year, to be sure that you aren’t a victim of price optimization.
- State Requirements
Look into your state laws to help figure out what type of coverage you need. States often have minimum liability requirements but you may also want to consider uninsured motorist coverage or collision coverage. Accident forgiveness can also be essential for first-time drivers. Look into whether your state is legally allowed to use your gender, occupation, or credit scores to determine your rates as more and more states add different banning laws.
- Take a Class
Typically, new drivers are required to take some type of driver’s education class in order to receive their license. However, the cutoff for this requirement is often the age of eighteen. If a friend helped you or you taught yourself how to drive, you may find that your rate is higher than you’d prefer. You can usually lower your premium by taking a defensive driving class or an advanced driving course that teaches you how to drive safely through hazardous conditions. Just make sure the payoff is beneficial before putting more money down. Check with your potential providers about discounts.
- Is Your Car Helping or Hurting?
Ideally, before you even purchase or lease a car, you should look into the coverage expenses for it. Now while the price of auto insurance isn’t the only factor you should consider when purchasing a vehicle, it can sway your decision between a few options. A high-end, expensive vehicle will cost more to insure than a car that is easier to replace. Added safety or anti-theft features can also help you reduce your premium so be sure to mention all devices when speaking with an agent.
Waiting to get your driver’s license is smart and cost-effective. If you have no need for a vehicle when you’re younger, why pay the higher auto insurance rates? Drivers under the age of 25 often pay nearly 50% or more for auto insurance. Be prepared to face slightly higher rates than peers who have been driving for a while when you do choose to obtain your license. The most important piece of information to remember is to build up a clean driving history or track record, as that can help drastically reduce your rate over time. A couple of speeding tickets or traffic violations will stick with you and are likely to raise your premium. The most important piece of advice for all new drivers is to drive safely and build up your driver credibility so that you can start saving on auto insurance as soon as possible.
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