Insurance rates for teenage
drivers are always higher than for other drivers
because they pose a higher risk for vehicle
crashes. Adding a teenager to the insurance
policy means a 50 to 100 percent increase in
the parents’ insurance
Information Institute, April 2004).
When adding a young driver
to your automobile insurance policy, you are
assuming responsibility for their actions.
It is important to review your liability limits
at this time to make sure you are adequately
covered by insurance.
cost of obtaining a driver’s license
varies by state but is $20 in the state
of Florida. Our survey of four major
insurance companies found the following: a family
with two vehicles (mid-priced, 2001 and 2002
models) will pay about $1,824 a year for automobile
insurance. By adding a young driver with
a clean driving record as an occasional driver
on one of the parent’s
vehicles, the premium will rise by about 65
percent to $2,888.
If the parents decide to
purchase a vehicle for the young driver
(a 2000 4-door Ford Focus, for example), the
premium rises to a whopping $4,361 for
the year, an almost 250 percent increase! If
the young driver with a car receives a moving
violation and is involved in an at-fault
collision, the premium will increase by another
$1,440, which raises the family automobile
insurance premium to $5,801 for the year.
Families can save money
on insurance by having multiple lines with
the same company (homeowners and auto),
keeping clean driving records, applying “good
student discounts” for young drivers with
a “B” or better grade point average
and having safety features on vehicles such
as anti-lock brakes and anti-theft devices.
AAA data states that for every mile you
drive in 2004, it will cost you 56.2 cents.
This includes variable costs such as gas and
maintenance as well as fixed costs such as
insurance, taxes, license, depreciation and
The Bureau of Transportation
Statistics estimates the annual mileage driven
is approximately 14,500 miles per person.