Turning 18 means you are officially an adult, responsible for your own choices. But when it comes to car insurance you are still grouped with 15-, 16- and 17-year-old drivers, so your rates will look much like theirs, which is to say, high.
You may already be driving, you may own a car, or you may be planning to buy one. Your goal should always be a policy that matches your life and your needs. These seven tips will help.
1. Shop around
Get multiple quotes from different companies. This gives you a sense of what your average rate should be, and bargaining power when you finally settle on a provider. Most leading insurers have online rate generators at no extra cost, and you can get self-quotes online.
2. Keep your grades high
Keep your grade point average as high as you can. Most companies reward student drivers who maintain an A or B average in high school, or a 3.0 average in college, because insurers know that students with good grades are less likely to take the kind of risks that lead to an accident. Keeping your grades up can earn a 10% discount.
3. Choose a job or college close to home
Premiums are based largely on where you live and how far you commute. If you go to school or work more than 100 miles from home and do not take a car, you can usually get a significant break while keeping coverage for when you are home on vacation. Where you have the choice, closer is cheaper.
4. Drive a safe, inexpensive car
Save the fancy sports car for later. Rates vary widely by type of car, and a safe model with current safety equipment will save you hundreds of dollars a year. You have plenty of time to drive the car you want once your rates come down at 25. You can check safety ratings at the Insurance Institute for Highway Safety.
5. Take a driver's education course
Insurers favor young drivers who have completed extra driver education or a defensive driving course through a school or community college; online classes count too. This can reduce rates by 10 to 20%. Check which companies offer the discount and which courses they accept, and make sure the cost of the course does not outweigh the saving.
6. Raise your deductible
A common way to lower your premium is to raise your deductible to $500 or $1,000 instead of $100 or $200. It costs you more out of pocket if you have an accident, but the saving on your monthly payments will usually be worth more than the added deductible.
7. Stay on a family policy
At 18 you may feel that putting the car in your own name is the grown-up move. It will often cost less added to your parents' existing policy, and that is acceptable as long as you are living at home. Staying on a family policy also earns the multi-policy discounts insurers offer, keeping rates below what you would pay alone.
