Insurance 101: Back to school cost-savings tips

September 11, 3:52 PMInsurance Industry ExaminerDanny Workman

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According to Sam Belden, vice president at Insurance.com, drivers from age 18 to 22 pay an average $150 in auto insurance premiums per month. This amounts to around $1,800 annually.

Given that young adult drivers are the highest risk group for driving violations and accidents, their rates are relatively expensive.

Another harsh reality is that many students were unable to find summer jobs this year. This was in part due to high competition from laid-off employees aggressively looking for any type of work that would support their families.

The other side of the coin is that students are often pressed for time, and thus prefer to drive to and from classes. People who continue to hold jobs while pursuing their studies can also commute quickly and safely to work.

So the number one car insurance tip is that student should shop for the best possible coverage available at the lowest possible premium. As Benjamin Franklin once said, “A penny saved is a penny earned.” Online auto insurance agencies like Insurance.com offer fast and accurate car insurance quotes through the Internet or by telephone.

For students who are moving to attend an educational institution in another state, online auto insurance rate calculators enable consumers to instantly compare average auto insurance premium by zip code.

Education and research staff at Insurance.com also offer the following tips on how to cut down on student driving expenses. All involve being smart by planning ahead.

Choose a car requiring lower insurance premiums
In some states, a used car may not require comprehensive and collision coverage.

But for even new cars, insurance premiums vary widely by car model. For example, a fuel-efficient Hyundai Sonata may cost $1,770 to insure while quotes for a new Scion averaged $2,850.

Insurance.com encourages consumers to bundle insurance costs together with an automobile’s sticker price to calculate overall car costs before making a final purchase decision.

Student discounts
Auto insurance discounts of up to 15% can be awarded to students with B grade averages or higher. Some insurers also offer low mileage discounts for drivers who drive less than 10,000 miles annually.
Buy a school parking permit

Tickets can be very expensive, and can involve extra costs if a car is impounded for traffic violations. Wise students find out their school’s park policies, and invest in a parking permit if it makes sense to do so.

Drive safely
Using cell phones while driving is now illegal in many states for a reason: they take away from a driver’s concentration. Some of the most serious accidents result from driver distraction; fatal crashes can happen in mere seconds. Statistics from Insurance.com show that auto insurance rates can go up by hundreds of dollars following just one relatively minor accident or a single ticket.

Pay credit card bills on time
Particularly in states allowed to base auto insurance rates in part on a driver’s credit history, students should carefully schedule their time so as not to miss a monthly credit card payment due date.