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Auto insurance went up by $4,068 per year. Just added a teen driver

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rated:
Allstate increased our rates by more than $4k. 
$600 deductible, with full glass coverage. 
2017 BMW 740i, 2015 Lexus GX 460 and a 2015 BMW 328i

My wife and I were the only drivers with 800+ credit scores and no accidents or tickets  in 15 years 

Today my son got his license and rates have skyrocketed. 

I know I can shop around but I have lots of rental properties. Liberty mutual, and others don't insure those. If I switch auto to someone else, Allstate will increase the rate on every property by $200-$300

Any options I am missing?

 

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I would advise you to change the insurance company or increase the size of the franchise.

casarstca (Aug. 16, 2017 @ 12:44p) |

Holy crap, did everyone miss this or am I the only one alarmed at paying $7200/year for insurance.
Please feel free to ig... (more)

howie888 (Aug. 16, 2017 @ 1:38p) |

you said you'd get him a new BMW, not that you'd pay his insurance. If he wants to drive have him pay his own insurance.... (more)

imbatman (Aug. 16, 2017 @ 3:32p) |

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rated:
Trade in your current fleet for a fleet of Crown Vics (or less expensive to insurance cars).

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I am guessing fresh teen male drivers of BMW might be causing many accidents?

Sorry, no useful comments for you but thanks for the info. Did not know others would not insure rental properties, sounds strange. Shopping around may be the best bet.

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NoMoneyInMyWallet said:   Trade in your current fleet for a fleet of Crown Vics (or less expensive to insurance cars).
  I want to keep the cars. I had a deal with my son as well. Get a full scholarship to college and I will buy a bmw. He got an almost perfect SAT score, zero tuition for next 4 years and I got him the car. Didn't factor the insurance when I created the deal
 

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king0fSpades said:   
NoMoneyInMyWallet said:   Trade in your current fleet for a fleet of Crown Vics (or less expensive to insurance cars).
  I want to keep the cars. I had a deal with my son as well. Get a full scholarship to college and I will buy a bmw. He got an almost perfect SAT score, zero tuition for next 4 years and I got him the car. Didn't factor the insurance when I created the deal

  Consider a different deal: offer him $4000 a year to not drive and use other transport instead.

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Does your son drive all of the cars? Have you talked about excluding coverage from two of the cars with the insurance?

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How much would raising the deductible lower it? Seems like you wouldn't be one of those people who want to pay $500 extra every year to avoid paying an extra $500 (with 15 years already with no losses).

Also you say "raised $4k" - but raised from what starting amount for context?

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Price him on his own policy (GEICO, Esurance, etc.) and if that comes up cheaper, have him excluded from yours (and vice versa). There will be a question on most insurance applications if there are any other licensed drivers in the household.

That said, 17-18 year old male driver in luxury, fast automobile, $4k sounds in the right range. Huge chunk opf that is liability, other big chunk is since he's driving an expensive auto to repair. And his odds of having an accident are, unfortunately, relatively high. https://www.dmv.ca.gov/portal/dmv/detail/teenweb/more_btn6/traff...

If you'd just added him as a part-time driver with two cars, I'd guess maybe $2,500/yr increase, but since you have the third car and its him primary vehicle...you'll pay for it.

Definitely shop around, lots of places to get quotes online for 1 driver. You can also price in the delta for moving all 3 of your auto insurance (factor in multi-policy discount).

Be sure to check companies like Amica and Chubb, they're often very competitive for complex situations.

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gnopgnip said:   Does your son drive all of the cars? Have you talked about excluding coverage from two of the cars with the insurance?
  Tried that.  Allstate cannot do that. I told them don't cover if he crashes my 740i. No luck. 

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Bend3r said:   How much would raising the deductible lower it? Seems like you wouldn't be one of those people who want to pay $500 extra every year to avoid paying an extra $500 (with 15 years already with no losses).

Also you say "raised $4k" - but raised from what starting amount for context?

  It was less than $2k. Now it is almost $6k

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jarfykk said:   Price him on his own policy (GEICO, Esurance, etc.) and if that comes up cheaper, have him excluded from yours (and vice versa). There will be a question on most insurance applications if there are any other licensed drivers in the household.

That said, 17-18 year old male driver in luxury, fast automobile, $4k sounds in the right range. Huge chunk opf that is liability, other big chunk is since he's driving an expensive auto to repair. And his odds of having an accident are, unfortunately, relatively high. https://www.dmv.ca.gov/portal/dmv/detail/teenweb/more_btn6/traffic/traffic

If you'd just added him as a part-time driver with two cars, I'd guess maybe $2,500/yr increase, but since you have the third car and its him primary vehicle...you'll pay for it.

Definitely shop around, lots of places to get quotes online for 1 driver. You can also price in the delta for moving all 3 of your auto insurance (factor in multi-policy discount).

Be sure to check companies like Amica and Chubb, they're often very competitive for complex situations.

 If he gets his own policy, he is 17 years old, God forbid he kills someone, can I be sued?  I think absolutely. 

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king0fSpades said:   Allstate increased our rates by more than $4k. 
$600 deductible, with full glass coverage. 
2017 BMW 740i, 2015 Lexus GX 460 and a 2015 BMW 328i

My wife and I were the only drivers with 800+ credit scores and no accidents or tickets  in 15 years 

Today my son got his license and rates have skyrocketed. 

I know I can shop around but I have lots of rental properties. Liberty mutual, and others don't insure those. If I switch auto to someone else, Allstate will increase the rate on every property by $200-$300

Any options I am missing?

 

  why I don't feel for your pain?
I totally agree it's fwf core principles to always keep a tight grip on your finances.....but in this specific post I somehow feel what's going on sounds about right....you get what you pay for is indeed true here...
Look at it this way: the insurer is actually insuring a whole lot of property (3 expensive/luxury category vehicles) for a small $333 per month (approx $10 per day) ... and it's just the insured's property....we've not even talked about the liability party's expenses in the case of a crash..........it's so very highly risky for the insurer to be taking on the liability of a fresh brand new DL holder, going crazy with the choice of keys to 3 expensive luxury cars at his reach.....teens are your good-boy-kids till one bad-influence-friend-convincing him for a midnight joy ride after Parents sleep.

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king0fSpades said:   
jarfykk said:   Price him on his own policy (GEICO, Esurance, etc.) and if that comes up cheaper, have him excluded from yours (and vice versa). There will be a question on most insurance applications if there are any other licensed drivers in the household.

That said, 17-18 year old male driver in luxury, fast automobile, $4k sounds in the right range. Huge chunk opf that is liability, other big chunk is since he's driving an expensive auto to repair. And his odds of having an accident are, unfortunately, relatively high. https://www.dmv.ca.gov/portal/dmv/detail/teenweb/more_btn6/traffic/traffic 

If you'd just added him as a part-time driver with two cars, I'd guess maybe $2,500/yr increase, but since you have the third car and its him primary vehicle...you'll pay for it.

Definitely shop around, lots of places to get quotes online for 1 driver. You can also price in the delta for moving all 3 of your auto insurance (factor in multi-policy discount).

Be sure to check companies like Amica and Chubb, they're often very competitive for complex situations.
 

 If he gets his own policy, he is 17 years old, God forbid he kills someone, can I be sued?  I think absolutely. 
 

It's the other way.
As far as risk of getting sued: Wouldn't it be more risky for you to have him on your policy, God forbid he kills someone?

rated:
dealgain said:   
king0fSpades said:   Allstate increased our rates by more than $4k. 
$600 deductible, with full glass coverage. 
2017 BMW 740i, 2015 Lexus GX 460 and a 2015 BMW 328i

My wife and I were the only drivers with 800+ credit scores and no accidents or tickets  in 15 years 

Today my son got his license and rates have skyrocketed. 

I know I can shop around but I have lots of rental properties. Liberty mutual, and others don't insure those. If I switch auto to someone else, Allstate will increase the rate on every property by $200-$300

Any options I am missing?

 

  why I don't feel for your pain?
I totally agree it's fwf core principles to always keep a tight grip on your finances.....but in this specific post I somehow feel what's going on sounds about right....you get what you pay for is indeed true here...
Look at it this way: the insurer is actually insuring a whole lot of property (3 expensive/luxury category vehicles) for a small $333 per month (approx $10 per day) ... and it's just the insured's property....we've not even talked about the liability party's expenses in the case of a crash..........it's so very highly risky for the insurer to be taking on the liability of a fresh brand new DL holder, going crazy with the choice of keys to 3 expensive luxury cars at his reach.....teens are your good-boy-kids till one bad-influence-friend-convincing him for a midnight joy ride after Parents sleep.

 I think I have grip.  I have decent net worth, no debt, make ok money, I have a very sizable 401k. Worked hard all my life and there is nothing wrong with enjoying my money. I can afford $6k per year. All I was asking if there is a way to save some money as $4k was kind of unexpected. 

They gave me me another option of $1k less if I raise my deductible to $2,000. 

rated:
Is there a rate drop after a couple years of good driving? Might be able to get a discount if they offer a good student discount or take a defensive driving class.

The issue is that 16-17 year drivers are 3x more likely to get into accidents than even 20 year olds. Couple that with being insured on three cars worth $25K+ each and the rate seems reasonable.

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realjones said:   Is there a rate drop after a couple years of good driving? Might be able to get a discount if they offer a good student discount or take a defensive driving class.

The issue is that 16-17 year drivers are 3x more likely to get into accidents than even 20 year olds. Couple that with being insured on three cars worth $25K+ each and the rate seems reasonable.

  This is with the good student discount. 

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realjones said:   Is there a rate drop after a couple years of good driving? Might be able to get a discount if they offer a good student discount or take a defensive driving class.

The issue is that 16-17 year drivers are 3x more likely to get into accidents than even 20 year olds. Couple that with being insured on three cars worth $25K+ each and the rate seems reasonable.

  25K each?  

Try 80K, 55K and 35K (depending on options...)

rated:
I had a similar deal with my dad when I was young (minus the BMW, plus a minivan - some of the time). He backed out. I survived, but I still have a tiny grudge. Good luck!

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It's not necessary to have all your policies from the same insurance company. The multi-policy discounts are usually only a few percentage points, so another provider could be a much better deal.

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Just went through this with my daughter. We went with her own policy through GEICO, it was a couple hundred dollars more than putting her on mine but I don't carry her liability.

With their own policy the liability is set to the terms of the policy and any assets they have. If they are on your policy, your assets are on the line.
Can they sue you? Of course, but their success in getting anything from you will be low. With their own policy, they are also building a credit history based on the payments they make.

Hope this helps.

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GPDMAJ said:   With their own policy, they are also building a credit history based on the payments they make.Whatever gave you that idea?

rated:
My insurance was 3k a year in college for a Toyota. Sometimes not much you can do to make sure you protect yourself.

Did you price out putting the car in his name and getting a quote under his name for lower policy limits? Also, if he is not "taking" his car to school and he lives at school, you could make him a non rated driver but he is still insured if he drives the cars "here or there"

At the same time, I would make sure your own limits are in line or one step up because you now have a teen who could ruin you if he gets into a big accident.

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First congratulations on your son's success!
Getting kids to apply themselves is a problem these days. And keeping your word is a very important life lesson.

As to insurance, personally I've always increased my deductible to keep my premiums down. And it sounds like a 2k deductible won't put you in a hole.
Secondly have your son take drivers ed. Both for his safety and a reduction in your premium.
Finally does your state offer discounts if the drivers complete one of those six hour driving classes?

 

rated:
You can try switching his car only to another company.

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king0fSpades said:   
I know I can shop around but I have lots of rental properties. Liberty mutual, and others don't insure those. If I switch auto to someone else, Allstate will increase the rate on every property by $200-$300


 

  Are you sure about that?  Typically the multi-policy discount is applied to the Auto-insurance.  And if Allstate is still insuring multiple properties I would expect a discount to still apply.   What you experience is one of the reasons I keep Auto and Home separate, when logical.  I've been with 3 different Auto insurers in the last 3 years due to price games they play. While I've had the same HO for 4+ years on my home and rental.

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Man - I'm jealous of OP's son.

Only problem with giving a 2015 328i to a 17 year old is the backseat isn't very spacious.

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From a parent with a recent new teen driver:
1) Raise your auto deductible as high as you are comfortable with.
2) Umbrella policy is a must.  Usually have to have 250K/500K coverage on auto to qualify for umbrella ($1-$3 million policy)
3) Consider a car that you don't need collision on.  It can be bumper card in the HS parking lot. 
4) You are correct with Allstate.  I can save with Progressive on the Auto, but I lose all the multiple policy discounts on my Homeowners, umbrella, boat etc.
5) Raise your "uninsured motorist" levels on your policy as much as you are comfortable with.
6) If he/she should get a ticket, (even the best kids do as new drivers), get the ticket reduced to supervision.  Have he/she pay the fees for the supervision.
7) Make sure that Allstate is "credit score" basing your policy rates.  If you have been with them a while, they may not be basing your rates on credit score.

rated:
What are your liability limits? A 16 year old driving a BMW could easily expose you to millions in liability. If you have lots of rental properties, you likely have lots of assets to protect. Consider an umbrella policy if you don't have one. An umbrella will likely require auto liability limits of at least $500k.

Also, I would jack the deductible to $2,000. You will only want to file a claim if it's catastrophic or your rates will skyrocket.

rated:
Few things we did with teenage drivers
1) Make sure that they take driver training course. Our insurance offers discount once you take course
2) If your insurance offers, send transcript to take good student discount
3) Will he be staying home for college or will he be staying at dorm while being at college? First year student may not be able to keep car at the school. If that is the case, inform insurance company that he is away from home at college and car will be home. This reduced our insurance premium significantly.
4) Raise deductible to 1000 or 1500 if insurance company allows.

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I'm not surprised at all at the rate.

Your insurer may be able to shuffle the policies around on the vehicles so that the oldest policy goes on your son's car, resulting in a higher rate for one of the other vehicles but may decrease your total household insurance bill. (My father did that for me 30 years ago-- one of my auto insurance policies is about 5 years older than I am)

Others have already said it, but if you don't have an umbrella policy, you need it. If your insurance company provides an additional multi-line discount, (State Farm does, for example) even with the additional premium for the umbrella, you may have a net decrease in your total bill.

For those talking about raising deductibles, I bet it doesn't make a significant difference. I bet the single largest $$$ line item on the bill is liability, where of course a deductible does not apply.

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You could buy a "crown vic" and make him the primary driver on that with only liability. You would remain primary driver on all the other $$$$ cars. Liability on the clunker should be closer to $2k

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Do you own a company?
I think that it is about 2k+- a year for each vehicle insured thru the company regardless of the age of the driver for our company vehicles.

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Have him "rent" a place in Virginia and register the car there. No need for insurance, just a $500 uninsured motorist fee. At 17 he is basically judgement proof.

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What some posts are missing is that the son is a minor, so no matter what they do to try to save money, they probably can still be sued. It seems that legal advice is important to check their liability.

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When I remember how badly teen ganda behaved with powerful RWD cars, 4K extra seems like a bargain.

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msrazzle said:   What some posts are missing is that the son is a minor, so no matter what they do to try to save money, they probably can still be sued. It seems that legal advice is important to check their liability.
  From what I remember on Judge Judy, a parent is only liable for the "willful misconduct" of their child, not for accidental damages they may cause.

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A fleet of Crown Vics?  I think I'd pay the $4K rather than endure a Crown Vic!!!

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How about getting him his own used car for about 8K and his own liability only (as high as possible) policy? This will most likely be cheaper in the long run and save mileage on your expensive cars.

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atikovi said:   Have him "rent" a place in Virginia and register the car there. No need for insurance, just a $500 uninsured motorist fee. At 17 he is basically judgement proof.
  Probably a bad idea.  If he has an accident, the other driver's lawyer will look for "deep pockets" to sue and that would be you.  For example, if he told an investigating officer that he was doing an errand for you, that would make you liable.  There are many gotchas that make you at least partially liable.

Skipping 97 Messages...
rated:
you said you'd get him a new BMW, not that you'd pay his insurance. If he wants to drive have him pay his own insurance.

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