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Page 18 NEWFOUNDLAKELIFE.COM Community
February 2024
Your Insurance Guy
Homeowners Insurance
Adding a New Driver to your insurance policy
By Jim King newfound insurance
The topic of adding a new driver, or perhaps adding a newly licensed driver to an insurance policy was recently a topic of conversation with a client. More specifically, the conversation was about why it costs so much to add a newly licensed driver to an insurance policy. It’s a good question and one that merits a deeper dive.
The basic perspective one needs to take is related to risk. It is how the insurance com- panies look at the world. They ask themselves, “what could
possibly go wrong?”, but not with the wry sense of humor and somewhat sarcastic tone with which that phrase us usu- ally uttered.
The things that drive the cost of auto insurance for a driver are pretty straight for- ward. First and foremost, is the amount of experience. Six or more years of driving expe- rience and you are considered an experienced diver. Less than six years and you are still considered a novice. The other significant factor is whether or not you have taken a Drivers Education course. Both the number of years of driving experience and whether or not you have taken Drivers Edu- cation training are two of the most important factors that insurance companies look at when determining an insur- ance premium and are looked at independent of age. In
other words, you could be 35 years old but if you are newly licensed you would still be con- sidered a novice driver.
Other factors that come into play are the type of vehicle that is being insured. Are you insuring a sports car? Maybe a 5L V8 Mustang with 500HP or perhaps a pickup truck but it is a Ford Super Duty F350 with 500HP? In either case - yup – you are going to pay up because the likelihood of an accident and the cost to repair are much greater than other vehicles.
Although the insurance companies won’t say it out loud, the risk profile for teen- age girls is different than that for teenage boys. As many parents can attest, the decision making of teenage boys can sometimes be questionable. Their tolerance for risk, or said another way risky behav-
ior is far different from girls the same age. It has to do with the development of the Fron- tal Lobe which more fully de- velops around the age of 25. Rest assured that Insurance Companies take that all into account.
So, how do you save money on insurance or said another way, how do you minimize the increase in the cost of in- surance if you are planning to add a new driver?
Fist and foremost, driver education is the single most important thing a new driver can do to minimize the cost of auto insurance. Another strat- egy may be to explore getting the new driver their own pol- icy rather than adding them to the policy of a parent. It won’t be cheap but it’s worth exploring that as an alterna- tive because in total it may be less expensive. You may want
to rethink the type of vehicle you are considering buying. A high-end car or a car with a lot of horsepower is going to cost you more to insure. Lastly, work with an Insurance Agent. They have access to a num- ber of insurance companies and they can get competitive quotes for you to review. They can also make sure you have adequate coverages for physi- cal damage as well as liability exposure should something happen.
Please feel free to call us with any questions or con- cerns about your insurance coverages. We are happy to help. We are here to answer any questions. You can reach us at 603-744-5000 or email us at info@newfoundins.com.
Our ad is on the front page or visit our website www.new- foundins.com
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