However, there are ways teenagers can save money on car insurance. Most insurance companies offer car insurance discounts designed specifically for young drivers. If you have good grades and complete a qualifying driver’s education course, you might pay less for insurance. It’s also possible to reduce premiums if you leave your car at home when you go to college. Let’s learn how you can get a better rate on your insurance by taking advantage of student discounts.
Why Are Students More Expensive to Insure?
Young drivers are more likely to get into a crash when compared to drivers with more years behind the wheel, according to data collected by the National Highway Traffic Safety Administration (NHTSA), so insurance companies often charge them more for their policies. Drivers between the ages of 15 and 20 are more likely to:
SpeedDrive while distractedMake mistakes on the road
Lack of experience isn’t the only risk factor for young drivers. People in this age group are also known to take risks while driving, operate a vehicle under the influence of drugs or alcohol, and not wear seatbelts. Because they’re at a higher risk for an accident, teens are more expensive to insure. This means car insurance companies often charge higher premiums for drivers in this age range. However, car insurance companies know that not every young driver will get into a crash. That’s why many insurers offer discounts specifically for qualifying students.
Good Student Car Insurance Discounts
Achieving good grades takes effort and demonstrates responsibility. And, since you’ll typically spend more time studying to keep your grade point average up, you won’t have as much time to goof off in a car. That means you’re less likely to get in a crash. Insurance companies know this, so they offer a good student discount for young drivers who work hard in school. Depending on your insurer, you may need to provide proof of your academic success. This could be a report card, transcript, or a form filled out and signed by your school administrator. You may need to submit standardized test scores instead of a report card if you’re homeschooled. Your insurer might ask for your ACT or SAT scores. If you qualify for this discount, make sure you continue working hard at school. You may have to resubmit proof of eligibility regularly. If your grades start to go down, your car insurance rates could increase. Good student discounts aren’t available in every location by every insurance company. Check with your agent to see what’s available in your state.
How Much Is a Good Student Discount?
Here’s a look at the average good student discount offered by three large insurance carriers. The dollar amount of the discount would depend on the amount of your premium. While good student discount amounts vary from insurer to insurer, it’s often between 5% and 25%. See with your insurer how much you can save.
Student Away-From-Home Discount
If you don’t bring a car with you to campus, you may qualify for a discount because you’re not driving as often. Some insurers offer this discount if you’re a college student living more than 100 miles away from home.
Driver’s Education Discount
Driver’s education courses can help you learn how to drive safely. They can help improve your situational awareness, so you’re more likely to avoid accidents. You may qualify for a discount if you’ve taken an approved course.
Safe Driver Discount
No matter how old you are, the best way to save money on car insurance is to drive safely. If you don’t get in any accidents or get speeding tickets for a certain amount of time, you may qualify for your insurer’s safe driver discount. While you won’t qualify for this discount right away, keep practicing safe driving and you could see your premiums decrease over time.
Membership Discounts
College students who are members of a sorority, fraternity, or honor society might also qualify for discounts. If you are member of one of those organizations, see if your insurer offers any savings.
How Students Can Save on Car Insurance
To ensure you aren’t paying too much for your car insurance, talk to your agent about any student discounts you may qualify for. You may not be aware of all your options or you many not automatically get the savings, so getting personalized advice can help you save money. Additionally, it’s often cheaper for you to be added to your parent’s or guardian’s plan instead of purchasing your own policy. It also lets you take advantage of additional savings, such as the multi-policy discount. But if that’s not an option, take time to shop around. That way, you can find a policy that’s right for you.
title: “Is There A Good Student Discount For Car Insurance " ShowToc: true date: “2023-01-24” author: “Eileen Hamilton”
Two of these discounts are “good student” and “resident student” discounts. Read on to learn more about these discounts, and how you can qualify for them.
Why Are Students More Expensive to Insure?
Car insurance companies are designed to minimize their financial risks. That means the more risk you bring to the company, the more you can expect to pay. On the other hand, the safer driver you are, the lower your premiums will be—but it’s complicated for students. While some young people may be excellent drivers, insurers don’t actually drive with each customer to assess their driving skills. Instead, they use equations that show the average risk of a particular group. Components in this equation include how long you’ve held car insurance, and whether you’ve ever made any claims. Since students are new to driving, they don’t have a solid record of driving, and the insurance company’s equation calculates this lack of experience as an extra risk. Thankfully, insurance companies do recognize that their calculations aren’t perfect. That’s why they make discounts available to individuals who can prove they are less risky than their peers.
Good Student Discounts
Insurance companies assume that someone who’s a responsible student will also be a responsible driver, and that’s why they offer good student discounts. Like many aspects of insurance, good student discount guidelines vary from company to company, and sometimes from customer to customer. One definition of a “good student” that’s used by several insurance companies is a student who maintains a “B” average (a 3.0 GPA). Students may have to prove their school performance by providing report cards and obtaining signatures from school administrators. Both high school and college students can receive this discount, so long as they are considered full-time students and fall within the age range specified by the insurance company (typically between the ages of 16 and 24). Complications arise with homeschooled students, but the discounts are still available—there just may be additional paperwork or school scores required.
Potential Savings With a Good Student Discount
The good student discount can be a serious discount, ranking high among the top money savers on car insurance. Savings will vary by the insurance carrier, but they are often substantial. State Farm, for instance, offers up to 25% discounts for good students. It’s best to speak with an insurance agent to see exactly how much you could be saving with a good student discount. Even if your grades aren’t good enough to qualify yet, you can touch base with your insurance agent as you work to improve your GPA.
Resident Student Discount
The resident student discount applies to students who move away from home to attend school. However, if the student takes the car with them, they won’t qualify. The discount is intended for students who leave their car at home and do not regularly drive while they’re at school. Students often remain on a parent’s auto policy while in college because they will drive the car when they return home to visit. They may also occasionally drive a car while they’re at school. Some companies may provide a specific minimum distance required to qualify for the discount. A student may be required to attend a school that’s at least 100 miles away from their home, for example. The verification process depends on the insurance carrier. Some will require a current schedule of classes, some just need the address of the college being attended, and others may not require any verification. Ask your insurance carrier what is required for verification and get the documentation as soon as possible.
Potential Savings With a Resident Student Discount
Like good student discounts, the exact savings for a resident student discount depends on a variety of circumstances. However, you can plan on the resident student discount making a significant dent in your insurance premium. Essentially, the student is a secondary operator with minimal access to a vehicle, which makes them much cheaper to insure.
