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Hernando Today

Insurance Sticker Shock Comes With Teen Drivers

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By KYLE MARTIN

Hernando Today

Published: March 22, 2009

Updated: 03/23/2009 04:05 pm

Because of a reporter's error, Tom Browning's name and agency, Browning Insurance Agency Inc., were incorrect in this story. Hernando Today regrets the error.

It's a timeless tradition that not even a sour economy can dampen.

For a teenager, earning a driver's license represents new freedoms and another step toward independence. Parents, on the other hand, are pulling their hair with worry - and they don't think it's justified.

The National Highway Traffic Safety Administration found 3,174 drivers between the ages of 15 and 20 died in motor vehicle crashes in 2007 - 13 percent of all reported crashes; an additional 252,000 young drivers were injured in 2007.

Insurance companies are paying attention to the figures, too. Even if a teenager never gets a ticket or is involved in an accident, the sticker shock of adding a young driver to a premium lasts for years.

In general, parents can expect a policy to as much as double in cost with teenagers. Local insurance agents polled by Hernando Today quoted figures ranging from $3,000 to $4,000 a year.

Even in tight times, teen driving continues unabated.

In part, it's because more people are not insuring their teen drivers until an accident happens, said Bill Munrow with M & M Insurance and Financial Solutions in Spring Hill.

"People are playing the system on a daily basis," he said.

Insurance agents have wised up, however, and now have software that will allow them to see every driver at a given address - including teenagers with a learner's permit.

Male drivers still command a slightly higher premium, but female drivers are now proving to be just as costly. The old reasoning was males did more driving and were more reckless, but that's no longer proving to be the case, Munrow said.

Something else to consider are the vehicles covered under the insurance. Parents might be tempted to buy an old clunker for a teenager under the belief it will keep their premiums low. There are some factors to consider, though.

In a two-parent household with two vehicles, a teenager can be listed as an "occasional" driver and the cost is lower. However, if a third vehicle is purchased for the teenager, the cost will usually be calculated for the highest-rated driver on the highest-rated vehicle.

For instance, Munrow recently added his teenager on his policy and it doubled because there is a Mercedes Benz on his policy. Even though the teenager might not drive the Benz, the insurance company considers it a possibility and charges accordingly.

Also take into consideration older cars are not always as safe. It might pay off in the short run because some models don't require physical damage coverage. But repair costs and potential harm to a young driver can offset that gain, said Danielle Healis with Killingsworth Insurance.

The higher rates continue until about age 25 or until a driver gets married.

Every little bit helps when premiums are high, so there are a few discounts available. The biggest savings come from good grades and certificates from driving classes.

Tom Browning, owner of Browning Insurance Agency Inc., in Brooksville, echoed other agent's opinions that the economy has done little to keep teenagers from driving.

Still, "it's like everything," he said. "People are trying to minimize their cost."

Reporter Kyle Martin can be reached at 352-544-5271 or kmartin@hernandotoday.com.

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