When teens just graduate high school, they are looking for a sense of independence. Whether this means living away from home, going to college out-of-town, working a new job, or driving a car, it is important to stay connected with your family!
According to “Insurance Journal”, it is important to remain under your parent’s insurance policies (for most states in America) until you consider living away from homeFor financial stability and long-term insurance coverage, consistent communication with family, friends, and co-workers is everything. for at least a year. Auto insurance in particular saves much more money when insured under your parents.
On average, 18-yr olds pay 18% more for car insurance if they sign up for an individual policy as opposed to remaining under their parent’s policies. This number varies by states, so the percent change could potentially be worse. Only in Arizona, Hawaii, and Illinois it is cheaper to establish insurance policies independent from your parents after age 19.
Since teen drivers are known to be higher risk on the road (especially those just getting their licenses and learning to drive), getting individual auto policies already add to the high cost of insurance a teen driver. Insurance journal states that parents with an 18-yr old on their policy pay an average of 77% more than they would without the teen. This number is certainly high, but would be much higher if the teen was independently insured.
The bottom line for investing in insurance comes with experience. Young drivers have a very limited track record, not much credit history and therefore it is harder for the insuring auto company to establish a foundation of trust and credibleness for the driver. As a teen driver ages and develops his driving ability, his premium lowers (assuming one keeps a clean driving record), and bottoms out after age 24.
So our advice from Magnolia Insurance is to stay connected with your family! For financial stability and long-term insurance coverage, consistent communication with family, friends, and co-workers is everything. Besides, there is nothing like a weekend family getaway or game night. If you go to college out-of-state, it only takes ~5-10 minutes to call or text home.
When you are ready to move out from home, graduate from college, and/or live independently on your own finances, then it is important to look at independent insurance. We will discuss this more in the next couple blog posts!
How do you think we are doing? Please let us know by contacting us at Magnolia Insurance Agency.
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3424 W. McGraw St.
Seattle, WA 98199