The short answer is: yes. Anytime you add an extra driver to your policy, your rates will increase. However, you may end up paying even more when you add your daughter to your policy. Since teenage drivers are some of the highest-risk drivers on the road. According to the most recent statistics from the National Transportation Safety Board, teen drivers have represented less than seven percent of the driving population but have accounted for more than 13 percent of drivers involved in all deadly crashes. (Source: National Transportation Safety Board, October 2013)

Fortunately, there are some steps you can take to help make insuring your teen a bit more affordable.

Take advantage of policy discounts: Your first step should be to ask your insurer if your teen qualifies for any policy discounts that are specifically designed for teens. For example, many insurance companies offer discounts (usually around 10 percent to 15 percent off of premiums) for teens who complete a driver’s education course, obtain a certain grade point average or participate in a safe driver program.

Consider the type of car your teen will be driving: Typically, new cars are more expensive to insure than older ones. As a result, you may want to consider purchasing an older, less expensive car for your daughter to drive. You may even be able to save more money by forgoing collision coverage on an older vehicle.

Consider whether an individual policy makes sense: In the future, circumstances may arise where it may be more affordable to insure a teen under his or her own individual policy as opposed to listing him or her as an insured on your policy (e.g., he or she gets into an accident or has numerous motor vehicle infractions). When the time comes ask your insurance agent to help you run the numbers to see which option is more affordable.

Be sure to shop around: You’ll want to take the time to compare the rates offered by different insurers. Insurance company rates vary widely so it often pays off in the end to do your homework.

Shawn Powell

Certified Financial Planner®

Contents of this article may have been entirely or partially written by Raymond James Financial Services, Inc. or Broadridge Investor Communication Solution, Inc.  Information provided courtesy of Shawn Powell, Certified Financial Planner®.  For more information contact your investment or tax advisor.  Information has been obtained from sources considered to be reliable.  Any opinions are solely those of the author and not necessarily those of Raymond James Financial Services, Inc.  Article is for information purposes only and should not be considered a solicitation or recommendation.  Shawn offers securities through Raymond James Financial Services, Inc. Member FINRA/SIPC.  He is located at 9075 Harmony Drive, Midwest City, (405) 732-7577.  Shawn can be emailed at [email protected].