Do You Need Insurance With a Learner’s Permit?
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If you have a learner's permit, you'll need car insurance — but not necessarily your own. Drivers learning the rules of the road can join a parent's policy. Drivers who can't or don't want to do that still have options though.
Every insurance company has different rules about when learners must be added to a policy. And many offer discounts to offset the high cost.
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How do companies handle car insurance for learner's permit drivers?
Even with fewer driving privileges, learner's permit drivers must be insured. They're just as vulnerable to accidents and need the financial security insurance provides.
In most cases, learner's permit drivers are teens who can be covered by a parent's policy rather than buying their own.
However, insurance companies take different approaches to young permit drivers. Policyholders may have to list every member of a household who has reached driving age on the policy. With other companies, only young drivers with a license need to be listed.
For example, if a young driver in your household has a learner's permit, Geico requires you to list them on your policy. As long as they only have a permit, your premium will not increase. Once the young driver gets a license, Geico will factor them into your rate.
Ask your company how they handle car insurance for permit drivers. Don't skip this step. If you don't properly list required drivers, then you may have to pay out of pocket for damage after a car accident.
The good news? Insurance companies usually don't increase rates until after a student driver has their license. At that point, rates tend to significantly increase. But there are still ways to get cheap car insurance for teens.
Teen driver insurance costs
Teens are the age group most at risk for car accidents. That's especially true for ages 16 to 19, according to the Centers for Disease Control and Prevention.
Because teen drivers pose such a high risk, adding them to an insurance policy greatly increases rates. The cost of adding a 16-year-old driver to a six-month family policy can range from $1,293 to $4,831.
However, those rates may vary a lot by the age and sex of the teen driver. Young men are more likely to engage in risky behaviors and to be killed while driving than young women. This means a family's policy rates will likely increase more when adding a male teen driver than when adding a female teen driver.
Car insurance discounts for teen drivers
Many insurance companies offer discounts to help families manage the high cost of insuring a teen driver. Ask your company if these discounts are available to you:
- Good grades: Have a high school or college GPA of 3.0 or higher? Companies often reward academic achievement.
- Tracking devices: By using a telematics device to share your data with your insurance company, you can prove you're a safe driver worthy of a lower rate.
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Driving classes: You may get a discount if you take a driver's education course, but it depends on state law.
- Living away from home: If you attend boarding school or college more than 100 miles from home and don't use the car for a large chunk of the year, you may get a reduced rate.
- Paying up front: While most policyholders choose to divide their insurance into monthly payments, paying for an entire plan up front can reduce costs.
In addition to asking for discounts, families can adopt other money-saving strategies. For instance, driving an inexpensive car can keep premium costs down, because it costs less to repair or replace it.
Parents and teens should also shop around for the right car insurance. It's tempting for parents to default to adding the teen to their own policy, but other companies may offer better rates. See this milestone as a chance to reevaluate your options and choose the one that best suits your family's needs.
Can you get car insurance with a permit?
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Adding permit drivers to a family policy might be the most common, but it's not the only way. You can buy a car insurance policy with just a learner's permit. Once you have that policy in place, you can also buy and register a car in most states — even if you are only 16.
While this approach offers a good deal of independence, it comes at a cost. A new driver at this age pays an average of $5,944 for a six-month plan of their own. By contrast, a new driver added to a parent's policy may pay as little as $1,293 — a $4,651 difference.
The single best thing you can do to lower your expenses as a young driver is to stay on your parent's insurance policy.
On parent's insurance policy | Total cost for six-month policy |
|---|---|
| Yes | $1,293 |
| No | $5,944 |
However, not all learning drivers live with their parents. Many people learn how to drive later in life and can't be added to a parent's policy.
Permit drivers who live with a spouse or significant other can sometimes be covered under their plan. Be aware that married couples may receive better deals than unmarried couples, who may see their rates go up when a permit driver is added to the policy. Ask your insurance company about the options available to you and your partner.
If you are a permit driver who lives alone, you may find it difficult to find insurance until you get a license. Many national companies do not offer insurance to first-time learner's permit drivers. Instead, contact smaller, local insurance providers and explain your situation. You'll likely pay more, but the situation is not unheard of.
For new drivers, getting a permit is exciting. Obtaining auto insurance coverage is a crucial first step to new levels of responsibility and freedom.
Editorial Note: The content of this article is based on the author's opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.
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