Guest Post – Should you pay for your teen’s car insurance?

This is a featured guest post from Sainsbury’s Finance Money Matters Blog

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Should you pay for your teen’s car insurance?

Teenage drivers are the most expensive to insure. So when they get behind the wheel, it represents the beginning of a costly period for either parent or child. The question is, should you foot the bill for your kids?

What are your options?

The most expensive option is for them to be insured to drive their own car. There is the initial cost of the car, and the insurance premium will comfortably run to four figures.

Another option is to add your child as a named driver on your own policy. This is less expensive, but it does mean you will have to give up your car from time to time!

However, you must continue to be the main user of the vehicle. If you use it less than your child, it renders your policy void or possibly fraudulent, as far as your insurance company are concerned.

You can also look at different levels of cover. Third party policies are known to be cheaper than fully comprehensive policies, but this might not always be the case. If you want to save as much as you can, make sure you cover all the bases and get car insurance quotes  for fully comprehensive and third party policies so you can be sure that you are getting the best deal.

Should you make your children pay?

This is a difficult question to answer, and much will depend on personal circumstances and the relationship you have with your child. One thing you have to recognise is that very few teenagers will be able to afford any insurance policy for themselves. It is not uncommon for premiums to be in the region of several thousand pounds for the year, which is clearly out of reach for many teenagers.

Some parents like to split the money and set up a direct debit, considering it important that their kids learn to take some responsibility for their own affairs.

Consider the consequences

Insurance premiums for 17- and 18-year-olds are high for a reason. You might consider your child responsible, but statistically teenagers are far more likely to crash a car than any other age group. If you are ready to pay for their insurance, you need to be prepared to pay out an excess fee on a claim, too.

It is also worth noting that some young drivers might actually run the risk of driving without insurance if they can’t afford to pay for it themselves – possibly resulting in the loss of their licence and some very hefty fines to boot. So that might be another consideration when deciding whether to help your child financially.

The final call

It is important for your children to learn to be responsible for themselves, but helping them to get insured and allowing them the opportunity to drive gives them the freedom they might need to flourish. Every situation is different, and only you will understand what is right for your family.

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