Although you may have heard the term “teen car insurance”, there isn’t actually a specific kind of auto insurance coverage for teens. Whether a driver is 16 or 96 years old, they must have liability insurance that satisfies the state’s minimum standards.
Understanding the fundamental coverage levels for auto insurance is necessary to choose the degree of protection that is best for teen drivers. Each of the major coverage kinds is described briefly in the sections below:
Insurance for Teen Drivers’ Liability
Knowing the various types of insurance is useful when you’re helping a new driver purchase their own policy or purchasing coverage for a teen driver. Almost all states mandate some kind of liability auto insurance, which pays for third-party losses when a driver is at fault. The primary components of liability coverage are as follows:
Bodily injury liability: When you are at fault for an accident, bodily injury liability pays for lost wages, medical costs, and other costs for someone who is hurt.
Property damage liability: When you cause an accident, you are responsible for any damage to the property of others, such as a vehicle.
Depending on the state, several levels of liability insurance are required. For instance, drivers in North Carolina are required to have 30/60/25 coverage, which means a policy would cover up to $30,000 in bodily injury per person, $60,000 per accident, and $25,000 in property damage per accident.
Teenagers’ Collision Auto Insurance
Regardless of who is at fault for the collision, collision insurance safeguards your car. Although it isn’t required by state law, lenders will probably insist on collision coverage if you’re financing a car because it safeguards their investment.
If your automobile is damaged, collision insurance will pay for it, and if it’s declared a total loss, it will pay you up to the vehicle’s actual cash value (ACV) . However, non-moving-object damage is not covered by collision insurance.
The following scenarios include submitting a collision insurance claim:• slamming into a guardrail• a collision with another car• getting hurt as a result of a pothole or other road hazard
Comprehensive Car Insurance
Another typical requirement for car buyers who are financing their purchase is comprehensive insurance. It is oriented more toward non-driving scenarios than collision insurance is.
If any of the following occur, comprehensive coverage will pay for your damages:• collision with a creature• Environmental harm (fire, hail, flood, and tree sap)• damage caused by things falling• Vandalism or theft
Other Teenage Car Insurance Coverage Levels
Additional insurance coverage varieties include:1. Gap insurance: If the actual cash value (ACV) payoff for a vehicle is insufficient, this will cover the remaining balance of the loan.2. Medical payments: These pay for the driver’s or other passengers’ medical expenses.3. Uninsured/underinsured motorist: This coverage offers extra financial security if the at-fault driver in a collision lacks insurance or has insufficient coverage to pay for damages.
Why Do Teens Cost More To Insure?
Insurance for teen drivers is more expensive for a number of reasons. Being younger and having little to no driving experience results in higher auto insurance prices, according to insurance providers, which consider characteristics like age and driving experience when determining insurance premiums.
Younger, less experienced drivers are generally more likely to be involved in serious accidents, according to research. According to the Centers for Disease Control and Prevention(CDC), car accidents are the second most common cause of mortality for teenagers in the United States . The CDC further notes that the risk of collisions is greatest in the first few months after a youngster obtains a driver’s licence.