New Driver? You Need This Coverage

New drivers, particularly young drivers, have higher insurance rates for 2 reasons: inexperience behind the wheel and immaturity.

Just like anyone attempting to master a new skill, teen drivers tend to make mistakes and take risks that more experienced drivers likely wouldn’t. When it comes to insurance, increased risk translates to increased rates.

While there are some things you and your teen driver can do to lower your rates (this article explains), there are certain insurance policies most new drivers should have and recommendations to get the most out of your insurance coverage. 

1. Increase your liability limit.

This section of the auto policy pays for the medical expenses of people you or your family members injure in a crash. Drivers often have a “100/300” limit, which pays a maximum of $100,000 for a single person’s injuries and up to $300,000 total for the injuries of everyone in the car you hit.

We recommend $500,000/$500,000 limits at a minimum to protect your assets and future earnings from a claim or lawsuit resulting from an accident. Double or triple the limit does not mean it will double the premium.

2. Increase your property damage limit.

This section of the auto policy pays for damage you cause to other people’s property or vehicles. We recommend $500,000 limits for property damage. If you think that sounds high, just imagine what it could cost if your new driver caused an accident with multiple cars – or if they hit a semi-truck. Insurance would help cover the rig and what’s inside.

3. Consider roadside assistance or towing and labor coverage.

This optional coverage goes a long way in providing peace of mind if your new driver is in an accident or has car problems.

4. Get an umbrella policy.

This type of coverage is an extra layer of liability protection that picks up where other insurance policies leave off and covers situations other policies may not. An umbrella policy is a totally separate policy, not coverage added to an existing policy. Sold in increments of $1 million, umbrella policies are usually fairly inexpensive, starting around $125 a year.

Some auto insurers offer something called accident forgiveness. It’s sort of like a “get out of jail free card” for an at-fault accident. You pay the deductible to get the car fixed but don’t pay an increase in premium at renewal. Penalties for an accident involving a youthful driver can increase your premium hundreds of dollars a year.

Each situation is different, so we always recommend talking to an agent. By asking lots of questions, we can make sure you have the best coverage for your unique set of circumstances.

As soon as your teen starts driving, give us a call at 800-369-2501 or request a quote online, so we can make sure you have the coverage you need to protect the driver – and your assets – from a claim or lawsuit.

Bell Insurance Services, LLC is a wholly owned subsidiary of Bell Bank. Products and services offered through Bell Insurance are: Not FDIC Insured | No Bank Guarantee | May Lose Value | Not A Deposit | Not Insured by Any Federal Government Agency.