You won’t be able to avoid a large rate increase when you add a teen driver, but there are ways to minimize the hit to your wallet.
Shop around. This is the time to compare car insurance quotes, especially if you haven’t done so in a few years. For example, among the companies we analyzed in California, rates for two parents and one 16-year-old ranged from about $3,000 a year (Mercury) to almost $6,000 a year (CSAA), for a policy with typical coverage of $100,000 bodily injury liability coverage per person/$300,000 per accident.
Make sure you’re getting discounts. Common discounts related to teens include good student discounts (often given for B and above grades) and, for college students living at school without a car, student-away-at-school discounts.
In addition, teen driver insurance programs can provide both a discount and valuable driving skills training. Keeping accidents off a teen’s record will definitely protect your rates in the future.
Keep your teen on your policy. It’s generally cheaper to put a teen driver on a parent’s auto insurance policy rather than get them their own policy. If you’re in doubt, though, have your insurance agent run quotes for both scenarios. Quotes are free, so there’s no downside in checking which option offers the cheapest car insurance.
Wait it out. Car insurance rates will generally start dropping at around age 25.