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As a group teenage drivers are the most expensive demographic in auto insurance. Rates for single males under 18 are particularly notorious, but the rates for females aren't much better. However, there are some ways to reduce the impact on your pocketbook when your son or daughter becomes a licensed driver.

BUY A CHEAP USED CAR

Teenage drivers must be rated with a particular vehicle owned by the household. If Dad's Lexus or Mom's SUV are the only options, get ready for some big-time sticker shock. However if a teenager can be rated on a liability only policy on a paid-for used car, the premium will be a lot less, quite possibly paying for the car itself with the difference. What's more, your teenager may still be covered driving any of the other family cars (but please check with your insurance company before giving the keys out). In short, it might actually be cheaper for you in the long run to buy Junior his own car right away. Just don't tell him I told you.

KEEP EVERYBODY TOGETHER

A standalone policy premium for a teenager can be cost-prohibitive, even if he or she has a spotless driving record. However, many insurance companies will offer discounts to a teenage driver that their parents qualify for (which are almost always much more generous than if they go it alone)- provided everybody stays with the same company. Auto-only customers are notorious for being here-today-gone-tomorrow "shoppers" in insurance industry circles, so many companies are well-motivated to go out of their way to keep them on the books.

GET GOOD GRADES

Student discounts are commonly available for teenage drivers with good academic histories. Most insurance companies will accept a recent non-official transcript or a note from a school administrator as proof if your teenager qualifies. Many companies offer similar discounts for college students under 25 as well.

STAY OUT OF TROUBLE

Teenage drivers are expensive enough without tickets or claims. With them, their premiums can be flat out astronomical. If your teen's driving record threatens to break the bank, it may not be enough for you to just take the keys away in the insurance company's eyes. The teen may have no choice but to either buy an even more expensive separate policy or to surrender his or her license altogether just to get that expensive rating off your policy. Think of it as a good motivator for them.

Unfortunately, there's really no way to avoid significant rate increases when teenage drivers join your household. However by following these guidelines and working with your insurance company, you can avoid those really ridiculous, out of control premiums.

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