Car insurance for people under the age of 25 can get a little tricky. The National Highway Traffic Safety Administration found that 35 percent of teenage deaths were caused by motor vehicle accidents, causing student car insurance rates to rise. While these rates are exceedingly higher than those of adults over the age of 25, there many discounts made available to students so they can get the lowest student car insurance rate.
Joel Ohman, a certified financial planner and founder of the website Car Insurance Comparison, reassures students to search for the lowest rates. “Students and those under the age of 25 will experience higher car insurance rates but that shouldn't discourage a student from shopping around to find the cheapest rates.”
There are a couple things to consider as you search for the student car insurance rate that fits you best. First off, consider what kind of car you have or what kind of car you are looking to get. If you do not yet have a car and are looking to purchase one, keep in mind that the type of car you choose may impact your insurance rate. As The Auto Insurance reports, if you are looking to get a sports car or a car with a potential high risk of speeding or accident, then it is likely that your insurance rate will rise. Additionally, a car that has little to no anti-theft features will also raise your rate.
If you have an older, hand me down car then you might want to consider opting out of the comprehensive and collision coverage. Studentcarinsurance explains comprehensive coverage as insurance that covers the damages to your car that are not caused by a collision. For example, if your car is stolen or damaged by a flood or fire, the comprehensive coverage will cover what was lost or damaged after you pay the deductible. Collision covers the damage to your car if it hits or gets hit by another vehicle or object, also after the deductible. If you have an older car, the insurance will typically only cover the cash value of the car. This could be a very small amount that will leave you with no car, and not enough money to purchase a new car. Therefore, purchasing this kind of coverage for your older car is an added expense that is unnecessary.
The best insurance rate discount offered to college students is the “good student” discount. With this, if you are a full-time college student, a GPA of 3.0 or a B average can give you a discount on your car insurance rate. According to CarInsurance website, statistics have shown that students with higher grade point averages tend to be more responsible when operating a car. On average, the good student discounts deduct about 10 to 15 percent from your student insurance rate, depending on what company you choose. Each auto insurance website offers cheap car insurance quotes and according to your GPA and personal information, your discount rates will vary.
Raising the amount of your deductible in the event that you do get into an accident is a less appealing way of lowering your student car insurance rate, but a way to lower it nonetheless. As reported by The Auto Insurance, the higher your deductible, the lower is your insurance rate. Your deductible is the amount of money you are responsible for if you get into an accident or if your car is damaged in any way. If your deductible is $250 then your insurance payment is going to be much higher than if you set your deductible at $1,000. Keep in mind though that you should be completely comfortable with the amount of money you set as your deductible. If you know you can’t afford $1,000 as a deductible, then strive for the highest amount of money you know you would be able to pay at any given time.
You can also maintain a lower insurance rate by constantly updating the information on your insurance plan. Marital status and an older age can both change your car insurance rate for the better, so by updating your information as it changes you can also lower your rates.
Even though, at first glance, student car insurance rates are daunting, there are ways to cut your costs. The most important thing is shopping around and gathering information on various student car insurance rate company policies. Keep in mind the discounts you can receive and be sure to inquire about them when signing up with a car insurance company.