Getting Car Insurance for a First-Time Driver

First time driver
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First-time drivers have a lot to learn before freely roaming the nation's roads and highways. Car insurance may not be the first thing a new driver thinks about, but perhaps it should be. It's an important aspect of a every driver's responsibilities, not just for their own peace of mind, but for other drivers on the road as well. Every state aside from New Hampshire requires drivers to maintain at least some level of insurance coverage.

When drivers do think about car insurance, the cost is often the main concern, along with having the right type of coverage. In most cases, adding a new driver to an existing policy is the easiest and cheapest way to get covered.

Here we explain why first-time drivers should join an existing plan, along with some extra cost-saving tips.

Key Takeaways

  • It’s often best for new drivers to be added to an existing policy. 
  • New drivers are considered high risk by insurance companies. 
  • To get the best rate, shop around, and then shop around again before it's time to renew.

Perks of Being Added as a Driver

Aside from the obvious benefit of being covered by insurance, there are many reasons that first-time drivers should think about joining an existing policy, rather than seeking out a new policy for themselves.

Proof of Prior

As a first-time driver, you do not have current car insurance, nor have you had it in the past. One of the factors car insurers look to when quoting prices is the driver's current status, and history of coverage. Uninsured drivers are almost always considered "high-risk." High-risk drivers pay a higher premium than a standard or preferred driver. A shortcut around having no previous insurance is to be added as a driver on an existing policy, such as that of a parent, sibling, or partner. Your premiums will likely be lower since you're joining a policy that has history.

More Discounts

If the primary policyholder enjoys any extra benefits, aside from a steady insurance history, those may be extended to you as well. For instance, some people are able to cut insurance costs by bundling their car and home insurance policies. A teen driver getting insured for the first time may not own a home, but their parents might, and the teen driver can enjoy bundle discounts by joining their parents' policy.

Small Down Payments (Or None at All)

A small or nonexistent down payment is a great perk that comes with being added to an existing car insurance policy. The amount of money you'll skip depends on the type of policy you're joining, as well as how it is billed.

For instance, if you are being added onto a preferred policy, the holder may have to pay a higher premium to cover you. But this might not go into effect until the next billing cycle. Starting a new policy on your own, on the other hand, often requires more than a single month's worth of premiums as a down payment.

When a New Driver Can't Join an Existing Plan

It may not always be possible to be added as a driver on someone else's policy. If you are a first-time driver getting insurance on your own, know that you can do it, but prepare to pay more.

There are a couple of factors that work against new drivers. For one, teen drivers and other new drivers have very little driving experience, so they will be charged a higher rate. As mentioned above, newer drivers will also pay high-risk rates since they don't have a history of insurance coverage.

While rare, there are cases when a new driver could save money by getting their own policy. This might happen, for instance, if a teen driver drives a cheap car, but their parent drives a luxury vehicle. It may be cheaper to open a new policy that just covers the cheap car, rather than add the teen to a policy that covers both an expensive and a cheap car.

Tips for Cutting Costs

Joining an existing plan isn't the only way for new drivers to save on insurance. Here are a few more tips that can help, whether or not you can be added to someone else's plan.

Shop Around

Do your research and get quotes from many different insurance companies. You're looking for the company that will offer you the cheapest rate, but also for any that have special options for high-risk drivers. To save time, you may also be able to find agencies that provide quotes from multiple companies at once. Just make sure that if you use this tactic you qualify for the offers.

Pay in Full

Many car insurance companies will offer a discount for paying six months' worth of premiums at once. Paying in full shows two things: first, that you are loyal to that company, and also that you wont let your insurance coverage lapse. It may not be easy to save up that much money for a one-time payment, but you will save money in the long run if you are able to do it.

Shop Again in Six Months

Once you have kept continuous insurance for six months, it's time to start shopping for a cheaper rate. New drivers should not take a "set it and forget it" approach to car insurance. Six months of coverage could be all you need to switch your status from high-risk to a preferred, and that could be the biggest savings you will ever see in premiums.

As you research quotes, don't be afraid to ask for discounts that are not clearly listed. You may be able to secure lower rates if you can show that you're a good student, or have a steady job.

The Bottom Line

Getting car insurance for the first time can be a daunting task, but it's what every driving adult needs to do. Help from a friend or family member can make the search a lot easier, but it isn't the only way to get covered.

If you're on your own, stay strong, and stick to the plan. With a bit of research and calling around, you'll find coverage you can afford before too long. The biggest hurdle is in keeping coverage for your first six months on the road, and making payments. Treat those first six months as a trial period. Once you make it through, you've taken a major step toward much cheaper car insurance rates.