Car insurance for college students
Choosing the best car insurance for college students depends on a lot of factors. For example, who owns the car, where the student lives and how often he or she drives all come into play. As a college student, your insurance needs will vary dramatically depending on your exact situation. In some cases, college students should have their own car insurance coverage.
Average car insurance rates for college students
College-age drivers typically have pay insurance rates because their age group is shown to be dangerous on the road. As you grow older, your rates will dip. See how average annual rates for drivers age 18 to 23 who have their own policies vary:
This chart shows average rates for policies with $100,000 for injury liability for one person, $300,000 for all injuries in one accident, $100,000 for property damage, and a $500 deductible on comprehensive and collision coverage. Minimum liability refers to the lowest coverage allowed by law, which varies drastically by state.
But it’s important to know that in other instances it makes more sense to be listed as a driver on the parents’ policy.
How to buy car insurance coverage for college students
Review suggested approaches to insurance depending upon your circumstances:
For more detail on what type of coverage is the best fit, click on the link that describes your situation best:
Student who lives at home and drives own car
“If the college student has the title to the car, he should have his own policy and his parents should remove him from theirs,” says Penny Gusner, consumer analyst for CarInsurance.com.
Depending on the driving record of the student and the type of car he owns, this can be an expensive option for parents, but misleading your insurer can be a mistake. “Parents shouldn’t fib and say the car is theirs because that could lead to problems if there is a claim,” warns Gusner.
If you drive your parents’ car occasionally, their insurance should cover your, just as it would if a friend borrowed the car.
Student who lives at home and drives parents’ car
If you are driving your parents’ car on a regular basis and living with them, you need to be on their policy.
This is a fairly expensive option. A teenaged driver can double or even triple a parent’s car insurance premium. But if you fail to be added to your folks’ policy and get in an accident, the insurer could possibly deny the claim.
Student who doesn’t live at home, is at college in-state, drives his or her own car
If you don’t live at home and have your own car, you should have your own insurance policy.
Student who doesn’t live at home, goes to college in-state, drives parents’ car
If you are taking your parents’ car to school, you should stay on your folks’ insurance policy, even if the car is not being garaged at their house. “Since it is a temporary situation, most insurers will allow your parents to keep their insurance on the car while you are away at college,” says Gusner.
Student who goes to school out of state, drives own car and returns for holidays and summer
As long as the car is titled in your name, you should have you own policy, but using your parents’ insurance company may save some money.
“Some companies offer a discount if the student buys a policy from the same company as his or her parents,” says Gusner.
You should let the auto insurance company know about your plan to use the car in different locations because insurance requirements vary by state.
“You may need to change the garaging ZIP,” advises Kristofer Kirchen, of Advanced Insurance Managers, in St. Petersberg, Florida. “If the school is in a safer (or more dangerous) neighborhood it could affect your premium.”
Student who goes to college out of state, drives parents’ car and returns for holidays and summer
You should stay on your parents’ policy year-round, but tell your insurer where the car is being garaged.
Since the school is in another state, check state laws about registration and insurance. If you need to register and insure the car out of state, your parents may need to add your name to the title.
The new location may change your premium. Many factors go into calculating a car insurance rate, but the driver’s location is typically used to kick off the process. ZIP codes are organized into different risk categories by insurance companies based on the number and severity of claims within the area. From there, car insurance companies create the base rate used as the starting point for drivers seeking coverage, and then go on to review other factors such as the driver’s age, driving record and type of car.
This method, called “territorial rating,” can result in significant rate changes from ZIP code to ZIP code and even within a city due to differences in accident and theft claims. CarInsurance.com’s ZIP code tool shows average car insurance rates for nearly every city and town in the country, so you know what to expect if when you move to a new location.
If your rate increases due to a move, it may be tempting to keep your insurer in the dark, but this is not a good strategy. If you don’t let the car insurance company know about the location change, you run the risk of a denied insurance claim should you get in an accident.
Student who goes to college out of state, only comes home a couple of weeks a year and drives parents’ car
Most insurers would require you to be listed on your parents’ policy as a driver as you are still considered a household resident, according to Blackmon. But it doesn’t hurt to ask.
“If you are truly not coming back home for breaks, your parents can ask if they can drop you from the policy while you’re away, some insurers allow this,” says Gusner. “The downside to this is if you borrow a friend’s car while at college, you won’t have your parent’s car insurance as backup (secondary coverage) if there is an accident.”
Student who goes to college 100 miles from home, doesn’t have a car, returns for holidays and summer and drives parents’ car
While your parents should leave you on their policy so you are covered for holidays and summer, they should get a discount while you are away at school.
“If a college kid is at school at least 100 miles away, parents should absolutely ask for a discount. The discount can vary from zero to as much as 20 percent,” says Ben Blackmon, a personal lines underwriter who has worked in the insurance industry for 18 years.
There are usually conditions for this discount. “Liberty Mutual offers a Student Away at School discount for students in this situation,” explains Jesse Heller with Liberty Mutual Insurance. “For this discount, the student would need to be unmarried and younger than 26.”
Student who has own car, but will leave car at home when attending an out-of-state school
If the car is titled in your name, you should have your own insurance policy — it may even be required.
“Most insurers would require the student to purchase his or her own insurance as the parents would not have any insurable interest in the vehicle,” warns Blackmon.
On the other hand, if the car is co-registered, the vehicle could be put on your parents’ policy. When you are back at school, your parents may qualify for a discount as long as your college is at least 100 miles away.
Car insurance discounts for college students
Regardless of which scenario you fall under, good grades should help keep the premium more affordable.
“Young drivers may be eligible for a good student discount, which is available for students under the age of 25 who achieve at least a B average,” says Heller.
The savings can be substantial. “Typically, good student discounts range from five percent up to fifteen percent” says Gusner.
Check with an expert to see what options are available to you. “Don’t be afraid to call your insurer or agent to discuss your changing situation, it’s very possible they will find a way to lower your premium,” advises Gusner.
Even after college, there are discounts for students according to Heller, “Liberty Mutual provides additional discounts to recent college graduates who are just starting out. These discounts include new graduate, multi-policy and affinity discounts.”
Finally, consider shopping your coverage. Insurers rate risk differently which can result in dramatic swings in price. Gusner recommends shopping your policy anytime your situation changes. Insurers also have different programs in place and while one may offer a discount for an out of state student, another might not.
Student Car Insurance
Find cheap car insurance for students online
By Peter Carr Wednesday 17 January 2018
If you’re taking your car to uni, forking out for car insurance can be costly. But there are steps you can take to keep those costs down.
In this Article
A university education doesn’t come cheap these days – what with the high price of tuition, accommodation and ever-increasing living expenses – so the added cost of pricey car insurance is the last thing you want.
Even running a car as a student is expensive. Considering you’ve invested all that money in learning to drive, it would seem a shame to not take your hard-earned motor with you to university if you need it.
But don’t commit yourself to a budget diet of beans on toast just yet, as there are things you can do to make car insurance for students as cheap as possible without compromising on cover.
Car insurance for students is expensive
For new drivers between the ages of 17 and 24, a group to which most students will belong, the average insurance premium is £1,242 (December 2017)*.
The high price is simply because, as a group, students are statistically more likely to make a claim on their insurance than older drivers. The reasons for this are obvious – students tend to be young people with limited driving experience, and data shows they are more likely to be involved in an accident.
It could also be because students tend to live in areas with higher crime rates and so their cars are more prone to theft or vandalism. Plus, student houses are frequently burgled because they have laptops and other such expensive stuff.
There’s no getting around it, car insurance is a legal requirement for all UK drivers – no matter how tight their budgets may be.
This means that student car insurance premiums tend to be higher than average as the insurance companies need to offset the risk of paying out.
But there’s no getting around it, car insurance is a legal requirement for all UK drivers – no matter how tight their budgets may be. Students need to work harder than many drivers to get the best possible price for the cover they need.
How can I get cheap car insurance for students?
- Compare policies online: One of the most important things to do is to shop around for student car insurance policies. MoneySuperMarket’s quick and easy car insurance comparison service will tell you if you could save money and help you find the right level of insurance at the lowest price.
- Security measures: Invest in some extra security for your car if it’s going to be parked in a high-crime student area. Industry-approved steering wheel locks and immobilisers reduce the chances of your vehicle being stolen and a claim being filed, so they can lower your premiums.
- Telematics insurance: You could consider a telematics or black box insurance policy, where the insurer fits a small ‘black box’ to your car that measures how much you drive and monitors your driving style, rewarding safe and infrequent drivers with lower premiums.
- Size does matter: If you’ve not yet bought a car, bear in mind that more powerful and expensive cars cost more to insure because they’re more likely to be involved in a claim for damage or theft. So a smaller run-around will be cheaper to insure and less attractive to thieves.
- Named drivers: Adding older, more experienced drivers to the policy as named drivers can reduce student car insurance premiums, as the more drivers there are on your policy, the less time you’ll spend behind the wheel – at least in theory. Statistics show that 35% of younger drivers already have a named driver making their policy cheaper. However, you must never have an older more experienced driver ‘front’ your policy for you – but more on that in a moment.
- Pick the correct policy: Since younger, less experienced drivers started buying third party or third party fire and theft policies and then claimed after an accident, these types of policy have significantly risen in price. It might be cheaper for you to buy a fully comprehensive policy.
Pitfalls to avoid
Fronting: Setting up a policy on your car with someone else as the main driver and you as a named driver is a big problem.
It is known as ‘fronting’ and while it could earn you a much cheaper policy on paper, it is illegal. If you get found out the policy would be invalidated. Worse still, you could find yourself facing criminal charges for driving while uninsured.
Don’t buy too much insurance: If you’re only going to be using your car to visit home during the holidays, you might be better off getting temporary car insurance. You will only pay for the weeks or months you’re using the car, saving money in the process.
You must have insurance: You need to make sure you don’t fall foul of Continuous Insurance Enforcement legislation, introduced in 2011. Under the laws, you must insure any car you own unless it’s officially declared as not in use with a Statutory Off Road Notice (SORN) from the DVLA.
Anyone found with an uninsured vehicle not declared SORN can be issued with a fixed penalty notice of £100, and failure to comply could even land you in court and facing fines of up to £1,000.
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Companies Offering Cheap Car Insurance for College Students
It’s never easy for young drivers to find cheap car insurance quotes. Adding a child to your policy can double your rate, according to the Insurance Information Institute, and having young drivers get their own insurance is often more expensive. Factoring insurance bills into college students’ tuition payments can add insult to injury.
However, most providers offer opportunities for college students and their families to save money on auto insurance. Some discounts apply to high school students as well. Each of these four insurers couples student-friendly discounts with excellent customer satisfaction ratings from J.D. Power and Associates.
American Family is one of America’s largest auto insurance companies, with low rates in many markets. It maintains great customer service ratings and similar college-student discounts to competitors, including price breaks for good grades and going away to school without a car.
A smaller insurer, Amica Mutual has a long track record of satisfied customers, as well as the typical college student discounts. The company also offers roadside assistance and free help for drivers who lose their keys, which could be an asset if your child misplaces them while at school.
College students can save up to 25% off their premium for good grades with State Farm. The insurer also has resources for young drivers and their parents on their site, as well as the Steer Clear drivers training program, which helps newly licensed drivers set and meet safety goals, like avoiding phone use. Though it’s aimed at new drivers, those who complete it and maintain a safe driving record can save up to 15%.
USAA is consistently a top-rated insurance company that offers discounts for good grades and for completing an approved driver training course. If students attend school more than 100 miles from home and don’t take a car, they can get discounts to lower USAA’s already-reasonable prices. The only catch is students must qualify for USAA coverage, which is open only to current or former service members, Defense Department employees and their families.
Is switching worth it?
While each of these companies offers competitive discounts for college students, it may not be worth switching if you’re happy with your current auto insurer. Bundling policies leads to major discounts, and some companies also reward loyalty with cheap auto insurance premiums. In addition, you may have alumni or other affiliation discounts that apply to your policy and extend to your children.
Still, if you or your student prefers a separate policy, there are many good choices. Young drivers will still see higher rates than those with more experience, but comparison-shopping and research on discounts can make premium payments less painful.
Alice Holbrook is a staff writer covering insurance and investing for NerdWallet. Follow her on Google+.
Getting cheap rates on auto insurance
Some insurance companies focus on the bare necessities for you to drive legally—bodily injury and property damage liability with the minimum limits—along with a claims process that’s spotty at best. Rather than take a chance on that cheap car insurance company, you can get quality coverage that won’t break the bank with Nationwide.
Nationwide’s insurance professionals can quickly design a car insurance quote that meets your precise needs, even for those on a budget. Rather than going with the cheapest car insurance quote, make sure the company you choose provides flexible coverage and billing options. For instance, Nationwide allows members to pay monthly, quarterly or semi-annually online, through the mail or over the phone. It’s important to keep long-term flexibility in mind when deciding on an insurance carrier, not just go with the cheapest car insurance option.
How do I get cheap car insurance?
Everybody wants the best value for their car insurance premium. That’s why Nationwide offers many ways to get low rates, including our car insurance discounts. But what really makes us unique is the quality we offer our members. Here are a few benefits Nationwide members get:
- Dependable, customizable car insurance – you can choose the auto insurance policies that suit your lifestyle and budget.
- Top-notch claims service – Nationwide Claims Service is there when you need it, 24/7. You can file a claim online or by phone.
- An annual On Your Side ® Review to ensure your coverage is meeting your needs.
- Accident Forgiveness helps you avoid increased rates in the event of your first at-fault accident.
How can I lower my car insurance rates?
Certain factors influence your auto insurance rates, including some things you can control:
- The kind of car you drive – The price and style of your vehicle will impact how much your rates will be. The age of your car also matters; older cars tend to be cheaper to insure.
- The kind of coverage you choose – If you drive an older car with high mileage, you might consider dropping collision or comprehensive coverage if you need to keep your premiums low.
- The amount of your deductible – Higher deductibles can significantly lower car insurance premiums. While it could mean more out-of-pocket expenses in the event of an accident, it could also mean paying less over time.
- Where you keep your car – Rates are determined to some degree by the area in which you live and park your car.
- The number of drivers on your policy – If you add someone to your policy, your rate will increase, particularly if that “someone” is a new teen driver. Statistically teenagers have more accidents so they’re more expensive to insure.
- Your driving record – Insurance rates can sometimes increase after an accident or moving violation. The good news? You may qualify for a discount after a certain period of driving accident-free.
You can learn more about the factors that impact the cost of car insurance – and be sure to take them into account as you shop for coverage.
What about those discounts?
You can get more affordable rates on Nationwide coverage with our car insurance discounts, such as:
- Multiple policies discount – When you carry multiple types of insurance policies from Nationwide (car insurance, home insurance, life insurance, motorcycle insurance and so on), you could qualify for lower premiums on each policy than if you had separate policies from different insurers. Think of it as a discount for bundling.
- Affinity discount – We have established relationships with several organizations to offer discounts to their members. If you belong to such a group, you may be eligible for a discount on insurance from Nationwide.
- Good student discount – Cheap car insurance for students is possible with Nationwide.
- SmartRide ® discount – SmartRide is a tracking tool we offer to reward safe driving. Here’s where rubber truly meets the road – plug the device into your car and it will track your driving habits, such as hard braking, speed and so forth. With a steady hand at the wheel, your low-risk driving can earn you lower insurance premiums.
- Paperless discount – You’ll save money on stamps and avoid late fees if you sign up to have your Nationwide bill paid automatically at regular intervals from your checking or savings account. Some policyholders may even earn a recurring discount when they agree to receive documents electronically.
Start saving money today
Yes, you can have cheap car insurance and unparalleled protection. Get a quote in minutes from Nationwide.
Insurance terms, definitions and explanations are intended for informational purposes only and do not in any way replace or modify the definitions and information contained in individual insurance contracts, policies or declaration pages, which control coverage determinations. Such terms may vary by state, and exclusions may apply. Discounts may not be applied to all policy coverages.