Personal lines agents know all too well the financial headache that comes with adding a new, teenage driver on a family policy. The cost is hard to bear for many families, yet rates for insuring teens have largely come down.
According to a new report released last week from
insuranceQuotes.com, US families who add a young driver to their existing auto insurance policy will see an average annual premium increase of 79% – that’s down from the average 84% increase in 2013.
Not all policy increases are created equal, however. It costs more to add a young male driver than a female driver to an existing policy. A young man will increase the family’s premium by 91%, while a young woman will increase the premium by 67%.
Stringent to lax state regulation on rating also gives rise to regional differences, researchers discovered.
insuranceQuotes.com calculated these state-by-state rates based on a married and employed 45-year-old male and 45-year-old female who drive 12,000 miles per year and have policy limits of $100,000 for injury liability for one person, $300,000 for all injuries and a $500 deductible on collision and comprehensive.
Adding a teenage driver to this hypothetical couple revealed that the following 10 states charge the most for untested motorists.
- New Hampshire: 125.39% increase
- Rhode Island: 119.19%
- Arizona: 109.36%
- Wyoming: 105.77%
- Ohio: 100.17%
- Oregon: 99.87%
- Maine: 99.13%
- Connecticut: 96.33%
- Vermont: 95.06%
- Tennessee: 92.21%
Generally, it appears states with less insurance regulation have yielded higher insurance premiums. Wyoming, for example, imposes few restrictions on insurers, which makes for more significant rate increases when teenagers take the wheel.
In Hawaii, however, heavy regulations preventing carriers from considering age, gender or length of driving experience protect clients, with an average increase of 17%.
Other comparatively low increases can be found in New York (52%), North Carolina (57%) and Michigan (58%).
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