Cost of Insurance

You did it. You passed the driving test and just got your driver’s license. All that’s left to do now is get insurance for your car, but where do you even begin with that? 

Car insurance is insurance for motorized vehicles like cars, trucks, motorcycles, and so forth. It is used to provide financial protection against damage or injury resulting from accidents and against any liabilities that could also come up. Let’s look at how to get insurance and figure out the average car insurance cost for new drivers like yourself. We’ll also look at things you can do to lower your monthly payments on insurance if you find that your payments are too high.

Cost of Insurance

Getting Car Insurance

Getting car insurance can be daunting, but the best way to determine which insurance company you should go with is to shop around. For those who still live at home, check with your parents and see which insurance company they use for their cars.

Lots of factors go into determining rates, and some companies are better for certain types of drivers. For example, Geico and USAA are the two leading insurance companies that have been known to get cheaper rates for new drivers.

Make sure you ask those around you who are more experienced drivers which insurance company they prefer. There are pros and cons to every company.

It would be wise to have an Excel spreadsheet on the pros and cons of the different insurance companies out there. That way, you have a better view and understanding of which company is right for you.

The Average Cost of Car Insurance

Based on what’s out there as far as research, the average cost of insurance for new drivers is high compared to the insurance costs for experienced drivers. The average monthly payment is close to $400 for new drivers. On the flip side, the skilled driver pays roughly $140 per month. That’s about a $260 difference between them.

The average cost for new drivers is so high because they are more prone to accidents. According to the Centers for Disease Control and Prevention (CDC), almost 2,400 teens between the ages of 13 and 19 were killed in car accidents in 2019.

Those numbers are projected to increase as time progresses and as more of the younger generations start to drive.

Many factors determine the cost of your car insurance as a new driver. Don’t let that discourage you from getting insurance. There are several ways to lower your monthly payments and still get quality car insurance.

How to Lower Your Car Insurance Cost

Many factors contribute to how much your insurance payments are. There are ways you can lower your monthly payments and save hundreds — if not thousands — of dollars. These ways include avoiding getting points on your license, avoiding getting larger vehicles, and avoiding getting a poor credit score. Below, we will look at these ways in detail.

Avoid Getting Points on Your License

If you’re a teenager or a new driver, there is a higher risk of you getting into an accident than someone older than you. It’s essential to follow all road signs and traffic lights. This ensures that you are driving safely, and it keeps law enforcement from giving you a speeding ticket.

As a new driver, getting points on your license is a serious matter. If you accumulate seven points within 12 months, your license will be suspended. This will also increase your insurance payments.

In short, obey the law, and you will not get any points on your license. Be mindful of the rules in the state you live in. Some states have more severe penalties than others. Have items in your car that could help you should anything happen while you’re on the road too. Drinking water, blankets, and a car safety kit are all great things to have in your car in an emergency.

Cost of Insurance

Choose Your Car Carefully

Make sure your vehicle is an affordable one as well. Insurance can increase depending on the kind of car you drive. Avoid getting gas guzzlers like trucks. It will save you money and gas in the long run.

A good rule of thumb is to buy a car that is roughly 10% to 15% of your salary. Be wise and sober-minded about what you can afford, the mileage on the vehicle, and how much it will take to fill it up.

When starting out as a new driver, it might be beneficial to drive your parents’ car. That way you can save your money and only have to pay for gas. Whatever you decide, just make sure that the vehicle you’re driving is affordable. 

Improve Your Credit Score

Another way to lower your insurance payments is to make sure your credit score is up to snuff. What is a credit score? It is a number given to you that tells lenders how well you can pay back any debts you may have. A score that is 680 or more is considered to be good.

This may be difficult for you to do if you’re just a teenager, but it’s good information to have and know. If you’re an adult and have a poor credit score, a great way to get a good one is to pay your bills on time. You can also pay your loans and make sure not to get behind on payments.

It’s an exciting time getting your license. It’s a great accomplishment, and it’s a big step towards adulthood. Getting insurance is a big step too. You should be proud of yourself. Just remember that the ability to drive is not a right. It is a privilege and should be taken seriously.

Also, remember to drive responsibly and obey the law. Getting points on your license can increase your monthly payments. And please don’t drink and drive. It’s not worth it. Too many young people have died because of irresponsible behavior. Be wise, be careful, and enjoy this time of newfound freedom.

Peyton Leonard writes and researches for the insurance comparison site, TheTruthAboutInsurance.com. Peyton is passionate about new drivers and their safety on the road.

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