North Carolina Teen Drivers See Fewer Fatalities But Teen Driver Insurance Rates Still High

NORTH CAROLINA STUDIES IMPACT OF NEW TEEN DRIVER LAW

In 2011, the North Carolina Legislature changed how teenagers went about getting their drivers licenses.  Prior to the legislation, teenagers took a class (most of the time through a split class of Health & Driver’s Education) in high school.  After successfully completing the course, the teenager would take the driving portion of the class…then at the age of fifteen, would go get their Permit.  The permit allowed the young driver to drive, but only with an adult in the car.  Then, on that most glorious of days, when the young driver turned sixteen…the driver would be unleashed on the thousands of other drivers on the road of North Carolina.

In 2011, the system changed!  In that year, once a North Carolina Teen received his or her permit, the young NC driver had to fulfill a few extra requirements:

1. Record 60 Hours Of Driving over a year (or longer) with a parent or other supervising adult.
2. A Provisional License would then be issued that gave SOME unsupervised driving
3. During the Provisional License time, the teen would have to log an additional 12 hours of driving with an adult in the car
4. After completing step 3, a “mostly” unrestricted license would be issued until the teen reached 18 years old

While most adults who obtained their licenses under the old format did not understand the “why” of the new legislation, the impact is meaningful!  The NC Legislature asked the DMV (Department of Motor Vehicles) to do a study looking into the impact of the new law.  The findings were both eye-opening, and a little odd.

1. Teen Fatalities – 183 in 2010 to 114 in 2013 (Decrease of 69 | or 37.7{66506b27ca8f5234034d808fc0aabc14bc16ceb45d71027974b073b60f711cfe})
2. Teen Injuries – 22,116 in 2010 to 19,415 in 2013 (Decrease  of 2,701 | or 12.2{66506b27ca8f5234034d808fc0aabc14bc16ceb45d71027974b073b60f711cfe})

The “odd” part of the study showed that the number of traffic citations, for teen drivers, actually increased over this period of time.  The North Carolina DMV did note that the majority of the citations occurred while the teen driver was driving without supervision.

As most insurance professionals will tell you, the number 1 or 2 question they get asked goes something like this, “My teenager is about to get his/her license, how much will my insurance rates go up?”  Of course, that is a very loaded question.  The typical response in my North Carolina Insurance Agency goes something like this…”expect your auto insurance rates to double when you add a teen driver!”  Of course, the insurance rates for a teen age driver actually have much to do with the driving record(s) and history of the teen’s parents!  Many NC Insurance Carriers will only provide “non-state mandated auto insurance coverage” if the parents have a good driving and loss history.

Often times, the parents get a little “sticker shock” when they get the first premium invoice after adding a teen driver to their auto insurance policy.  However, the statistics really don’t lie!  Teen drivers get in more accidents, thus causing the insurance carriers to pay more out in claims.  Even with the increased premiums, many carriers lose money on auto insurance policies with teen drivers!

To that end, how can you, as the parent of a teen driver, keep your auto insurance premiums manageable?

TIPS FOR KEEPING NC AUTO INSURANCE RATES FOR TEENAGERS LOW!

1. Put The Teen Driver On Their Own Policy – MYTH | Often I will have customers call me and say “my friend says I should put my teenager on his/her own policy!”  I have to chuckle inside…”is your friend in the insurance business?”  The fact is, as long as the parents have good driving records, the teenager will get the benefit of “multi-car discounts”.  I have only seen a few times in my career where a teen was actually better off by being on his/her own policy…and typically that is because the a parent (or both parents) had HORRIBLE driving records.
2. Combine Auto & Home Insurance Policies with the same carrier – TRUE | I know that the insurance industry pushes combining both the home insurance and auto insurance with the same carrier….and it is true that the “multi-policy” discount helps lower premiums on both policies.  However, that discount becomes HUGE when the there is a Teen Driver on the policy!
3. My Teen Driver Got A Ticket, what should I do? First, you need to have a strong conversation with the Teen Driver about NOT GETTING TICKETS!  Second, I tell everyone, it is worth the price of a good lawyer to step in on your behalf (that is all I can say about that one)!  If you think your premium went up when you added your teen driver…you will not BELIEVE how much your premium will go up when that Teen gets a ticket!
4. Texting & Driving!  While this isn’t really a money-saving tip…it is a life saving tip.  Texting has become a real problem when it comes to driving…I can guarantee you that there is not one single thing that MUST BE viewed or replied to that can’t wait until you are not driving!
5. Purchase MORE Insurance!  I know this seems counter-intuitive, but if you don’t already have a Personal Liability Umbrella Insurance Policy…now is the time to do it.  Again, statistics don’t lie!  As soon as you let little Johnny get behind the wheel of an automobile, you drastically increase your odds of having to defend your assets from a claim related to an auto accident!  Think about this!  If little Johnny gets into an accident…causes bodily injury to a person (or multiple people)…how long would it take for your current liability limits to be exhausted (most people I see carry Bodily Injury Limits of 100K per person)  100K doesn’t go very far these days!
6. Purchase LIFE INSURANCE for you Teen Driver!  I know this may seem morbid…but as the Uncle of a 15 Year Old who was killed while driving a car…it can happen!  On a positive note, there are carriers who will discount the auto insurance premium if the Teen has a life insurance policy!
7. Choice Of Car Matters!  I am amazed on a continual basis when I get the phone call from a parent of a Teen Driver to add a new car!  Don’t get me wrong!  I would have loved to have gotten a BRAND NEW MUSTANG CORVETTE BMW…however, I am sure my parents would not have liked the premium they would have had to pay!  When choosing a car for your Teen Driver…I suggest looking at vehicles that have a great safety record (Honda is always a good choice).  I also suggest you choose a car that you doesn’t require you to have comprehensive & collision insurance.  These components of the policy account for a large portion of a Teenage Driver’s Insurance Premium.  The fact is…more than likely your teenager (no matter how good of a kid he or she is) is going to have an accident!  Buy your teenager a car that you can pay cash for…
8. I know insurance is expensive for 16-year-old kids, so I am going to wait until my child is 18 before I let himher get licensed! – MYTH – That would be AGE DISCRIMINATION!  In North Carolina, Drivers are hit with the Inexperienced Operator Surcharge on an auto insurance policy for the 1st THREE YEARS that they have their license…notice that I didn’t say from age 16 to 19.  It doesn’t matter if you are 65 years old, and have never been licensed!  You auto insurance will be surcharged with the Inexperienced Operator Surcharge for the 1st THREE YEARS that you have your license!

Keeping Teen Driver Insurance Rates low is always a big deal…there are little steps that you can take to help!  However, make sure you aren’t being “Penny wise & dollar foolish”!