Getting cheap car insurance for college students sounds like something that isn't possible. However, with the many discounts that high school and college students can take advantage of, they can lower their rates to normal levels just by doing a few things extra. Students often pay more than their adult counterparts because they are considered high risk drivers. Research does show that teenagers and college students fall into the demographic that cause the most accidents. The more risk involved, the more your insurance company will want you to pay for coverage. Below are some discounts and ways to get cheaper rates for a high school or college student.
Good Grades Discount
Getting good grades should be priority number one while in college. It is beneficial so that you can end up getting a good job out of college. However, another added benefit is that auto insurance companies often offer good grade discounts. The reason for this is that responsibility in the classroom usually translates onto the road, meaning a higher likelihood of safe driving and less risk. All companies are different, but the average grade needed is around a 3.0 GPA which is very reasonable. Other companies offer discounts if you make the Dean's List or Honor Roll. Either way, it is a discount that is very obtainable.
Age is all too often a determining factor when insurers decide rates. The younger a customer is, the more likely their premium will be higher. One way to mitigate this as a student is to strive for good grades. Insurance companies fund research to find correlations. One such finding suggests that students with good grades tend to be safer drivers. Thus, it benefits a student to excel in school—not only for employment opportunities, but for reduced rates as well.
Defensive Driving Classes
If you are just entering college, you still may not have taken driver's education classes. This class gives you more experience behind the wheel with a certified instructor and then classroom time learning the rules of the road. Again, there is a financial benefit to taking this class. It comes with a 10% insurance reduction for three years. You may have already taken Driver's Ed but are past the three years of reduction. You can take a defensive driving class which is normally a one time, five hour course. The discounts can go all the way up to 20% off your premiums.
College student car insurance is typically higher because of the risk for accidents. Not getting into accidents establishes a safe driving history and will get you lower rates in the future. This also goes for getting tickets which will also raise your rates. It may not be an accident, but a speeding ticket shows you may have a lead foot which can ultimately lead to an accident.
Low Mileage Discount
You may be a college student that lives on campus or close to campus and have no need for a car at school. If this is the case, you may be eligible for a low mileage discount. You will only be driving when you are home for break and the chances of an accident are reduced greatly. This can lead to lower rates.
Many college students want a flashy car, but that will lead to greater rates. Trade that in for an older, used car such as a Honda or Toyota and you will see your rates go down. The more expensive your car is, the more expensive it is to likely fix.
College student auto insurance may start out high, but with the amount of discounts available it can easily become affordable.
Why Student Car Insurance Is Costly
There are a few reasons that student car insurance is so expensive for the drivers that it covers, starting with the fact that young adults who are spending their time in class and writing papers can hardly afford even the cheapest bills. Beyond the fact that students tend to have less income, many families have found that getting new driver car insurance is a lot more expensive than insuring a seasoned driver. Finding affordable student car insurance has become such a problem that many families try to keep their freshman undergrad on a family plan, which is tough if they are moving outside of the family household. In order to help families understand why it's so expensive to get a young driver car insurance, it's helpful to look at the factors that drive up the rates for student drivers.
Student Drivers and Their Credit
It's a little-known secret that more of what the average American pays for is influenced by their credit score. Insurance is one thing that companies may be able to tie to a consumer's financial credit score. The dubious reasoning is that those with debt may be more likely to practice reckless behavior. This idea might be statistically correct, but many consumer advocates argue that this kind of risk rating is discriminatory. Nevertheless, when insurance shopping, it helps to have good credit.
Student Drivers and Lack of Driving History
One of the main reasons that student car insurance is so expensive is that the insurer doesn't have any driving history to use in assessing risk. As some might expect, when the information on risk isn't there, the company assumes a much higher risk, and sets rates for auto policies accordingly. The result is that young people have three strikes against them before they even get behind the wheel, and they need to spend time and money proving that they are safe drivers. Again, consumer advocates find this to be an unhelpful and discriminatory practice, but it has become standard in the auto insurance industry.
Student Drivers and Their Reputation
Although this may not be a factor in calculating policies, one of the reasons behind the high cost of student insurance is that students are generally expected to live a less responsible lifestyle involving alcohol, promiscuity and general risk-taking. Some schools even seem to encourage this. The culture of undergraduate education in America isn't something that most insurers would like to have a stake in, and so it stands to reason that companies would look to push rates higher for student drivers.
Student Drivers and Their Short-term Residence
Auto insurance companies also calculate policy rates according to where the vehicle is garaged. As many students move from rural communities or low risk areas to dormitories in busy college towns and cities, their rates will get higher. This is just another factor that pushes up insurance rates for some student drivers.
Look at these critical factors and examine how your family can help to bring insurance rates lower for drivers who are just getting on the road while attending high school or college.
More Tips for Getting Cheaper Car Insurance for College Students
All drivers would like to have cheaper car insurance, but for some bringing down this necessary cost can be extremely difficult. College students are among several categories of drivers who generally find it hard to get affordable car insurance. Part of this is because they are younger, and auto insurance companies tend to consider them "high risk." Here are some popular strategies for finding a lower insurance cost for student drivers.
- Look for school sponsored programs. Some colleges and universities will actively provide solutions for their students, especially for those with full time student status. These kinds of services are part of how schools help students focus on their studies during a full semester.
- Find other affiliation discounts. If a school does not offer an active program, sometimes insurance companies will reach out to students of a particular university or college. Although many of these affiliation discounts tend to apply more to alumni, there are some available for students. Talk to various insurers about where you go to school to see if they're willing to apply an affiliation discount.
- Choose a low risk vehicle. Not all drivers are aware that auto insurance companies regularly use the ISO (Insurance Services Office) to rate particular cars in terms of risk, but this calculation usually ends up influencing policy premiums quite a bit. Choosing a reliable older model of family car over a late-model sports car can bring down insurance costs for a struggling student.
- Use deductibles and other policy factors. Drivers who get educated about negotiating insurance policies can also save themselves more money by selecting leaner coverage options and using deductibles to cut premiums. Deductibles require the driver to pay out more in the case of an accident, but they can be useful in lowering monthly or annual upfront costs.
- Try a family car insurance plan. Most family car insurance plans require the younger driver to live at home with parents, but for some students, these types of plans are worth a look. Family plans can be a lot more efficient than individual car insurance for each driver.
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Once you have completed applications for as many different providers as you like, you can compare the offers you are given and choose the coverage which best suits your needs for the best available price. If it's only price which concerns you, minimum liability coverage is probably your best bet.
Insurance companies often offer discounts for those enrolled in certain organizations or alumni groups.
Look at the Way You Drive
If you are the driver with the heavy foot who has to be the first away from the light, then you will likely also be the driver who is paying the higher insurance premiums on campus. A look at your own driving record will tell you. If there is a listing of infractions for speeding and reckless driving, car insurers are entirely within their rights in charging you higher premiums than someone who stays within the speed limit and drives safely.
Look Closely at Your Attitude
If you think that it's okay to get into a car or sports car or SUV with a "buzz on" thanks to a night of drinking or using drugs, then you are a candidate for higher insurance premiums because the chances are good you will find the next large tree or wall or ditch and place your vehicle right in the middle of it.
How about a $1,000 or more deductible? This means you're stuck with the first $1,000 or more of any accident. The savings it offers range between $20 and $200, depending on the type of car you drive. How about driving without collision insurance? In some states, it's illegal (you have to check, but it's required in Massachusetts and other New England states). If it's legal where you're going to school, you could chance it for a savings of about $300. A good idea is using the same carrier for several vehicles or items. This may get you as much as a 15 percent multi-car insurance break, although you will probably have to convince your parents to change insurers, or you will have to use theirs.