When a teen starts driving, it means more than just worry for parents. If your teen will be driving the family car, you have to let your insurer know. Depending on your province and policy, your premiums could change as a result. But you may also have access to an auto insurance discount if your youth takes a driver education course. Here are some things to consider.
You May Have to Update Your Car Insurance
In most cases your teen should be added as an additional driver under your policy. That's the case if they have a full licence and live in your household. If they never use your car or only live with you part-time, you may not have to update your coverage. Your insurer can let you know.
It may be that your teen must be added to your policy, as is everyone in your household who has a full licence and access to your vehicle. That's the case in Ontario, but in Quebec that automatic addition goes to the most expensive car to insure.
The bottom line is that it's tough to know the rules that may apply to you without talking to your insurance professional. You don't want to get caught without the right coverage in the case of a mishap, so it's important to have that phone call.
Your Premium Rates May Change
Once you update your insurance, you may have to pay more. That's because your insurer takes the driving record of all drivers and how much the vehicle is driven into account to determine the premium. You may lose some discounts, like the ones given to drivers who have low annual kilometres. An additional driver could increase the annual kilometres the vehicle is driven which could affect the premium. It's a good idea to discuss with your insurer how often your teen may—or may not—be using the car, so their status as an occasional or regular driver is properly documented.
Once they get their own insurance, teens, who maintain good grades can help keep costs low by looking for an insurance company that offers a good student discount. They gain experience as a named occasional driver on their parents' policy, which will establish an insurance history that could help lower their premium.
What Happens if You Don't Notify Your Insurance Company
The higher costs of adding a teenage driver to your policy can make it tempting not to let your insurance provider know about the change. But transparency is a must any time you're dealing with insurance.
If your insurance provider discovers that you now have a teen driver and you did not notify them, it could be considered a policy violation and could potentially deny coverage in the event of an accident.
Your Options to Increase Safety
Low premiums make a family car more affordable. But there's also value in getting the right coverage. If your teen starts driving your car, you may want to get added protection. It is a modest investment to increase third-party liability coverage as a safety net.
Keep Up the Conversation
Talk to your teen about driving safety. Let them know that a clean driving record can help them get cheaper rates when they have their own car. Developing good driving habits also starts them on the path to a successful driving career. That helps keep everyone safe.
You may want to consider installing a telematics device in your car. A telematics device, also known as usage-based insurance, monitors such things as the distance the vehicle is driven and time of day the vehicle is on the road. You could receive a discount just for installing the device.
Search for the Best Rates
Car insurance varies significantly from region to region, even within one province. It's a good idea to know all your options. Kanetix.ca makes it easy to find car insurance quotes across the country. When your teen gets behind the wheel, you want to keep them protected.