For a 17 year old car insurance can be difficult or impossible to obtain at an affordable rate. In many cases, teenagers end up paying more in car insurance than for their monthly car payments. This increase in insurance costs is due to the higher risk assumed by the insurance company when providing a 17 year old car insurance. Teenagers are involved in a larger proportion of accidents than older, more experienced drivers and thus cost the insurance company more to insure than most other groups. Insurance agencies pass the added cost along to consumers in the form of higher premiums and teenaged drivers often take the brunt of these extra fees.
Insurance companies determine the rates they will charge by collecting statistical information on the per capita likelihood that a certain demographic of the population will be involved in an accident. Statistically, drivers under the age of 24 or over the age of 75 are much more likely to be involved in automobile accidents than drivers between those ages; as a result, insurance premiums are usually much higher for those age groups. Even for a gainfully-employed 17 year old car insurance can be priced out of reach, especially for those who must carry comprehensive and collision coverage in addition to basic liability insurance.
For the majority of younger drivers, liability insurance is sufficient to keep their vehicles legal. For financed or expensive vehicles, however, collision and comprehensive insurance is often necessary. Many loan companies require this coverage for vehicles they finance; while it provides additional protection against damage to the vehicle, it can double or triple the cost of automobile insurance over liability coverage alone. One way to reduce the cost of comprehensive and collision insurance is to accept higher deductibles on the policy; this can present problems if the teen is involved in an accident, however, since the deductible must be paid before any insurance benefits are disbursed.
Certain discounts are available that may provide some financial relief for 17 year old car insurance customers. Rather than maintaining separate insurance policies, some overall cost savings may be realized by adding the teenager to an existing family policy; when combined with a home insurance policy, many insurance agencies give significant discounts that may lessen the financial drain on younger drivers. Additionally, students who maintain a high grade point average may also be eligible for a reduction in their insurance premiums; many companies offer significant discounts for good students. Finally, completing a driver’s education or a defensive driving course can sometimes qualify younger drivers for reduced premiums, depending on the company.
Some younger drivers may be tempted to skip insurance entirely due to the expense; however, this is illegal in most states and is unwise regardless of its legality. Auto insurance provides financial protection against liability for damage and injury and is a must, even for 17 year olds with their very first cars.