Yes, you need insurance with a learner’s permit. But it might come included with a parent or other household member’s existing policy.
My Teen Got a Learner’s Permit. Does He Need Car Insurance?
The teen will definitely need insurance. Some insurers offer coverage on a parent’s policy for family members with learner’s permit. But most demand that you call and list them on the policy as a permitted driver. The safest option is to call and find out.
When Should I Add my Teen to my Insurance Policy?
Most insurance companies need all household drivers with a license have insurance. This means that you will have to add a teen to your policy right after they get a license. Or you can buy a separate policy for them. That option will likely cost more though. Though as mentioned, you may need to add them to your policy beforehand, when they first get their permit.
What if My Insurance Provider Requires my Teen Driver With a Permit to Have Auto Insurance?
In this case, you need to either add the teen to your policy or create a new policy with only them on it.
How Does my Carrier Handle Learner’s Permits?
Most insurers want a permitted driver listed on the policy. Fortunately, a driver with a permit often costs less to insure than a newly licensed driver. If you have one vehicle and two drivers, you can sometimes list the permitted driver as secondary instead of primary. This may help with savings.
Then again, other insurers do not allow listing a permit driver as a driver on the policy, instead of requiring a valid license. Even if they are not listed as a driver, they may still need to be listed as a household member. In some cases, this also goes for children under the age of 16 so the insurer can track when new drivers will likely join the policy.
Living at Home
Most often those with a learner’s permit are teens living with parents. In this case, whether they need to be added to their parent’s policy depends on the insurance company’s rules. Some insurers have language within the policy that covers drivers with a learning permit. But some other companies demand anyone of driving age added to the policy. Even if they don’t have a driver’s license or permit in some cases.
If your teen is getting their permit, the best approach is to call your insurer and ask. If you do not like the answer, you can always shop around.
Living On Own
What if I Don’t Live at Home Anymore? Am I Still Covered Under my Parent’s Policy?
Generally, the requirement insurers have when determining whether to insure a driver with a permit is that they live at home. If they do not live at home, they will not likely have coverage from their parent’s policy.
If you get a learner’s permit and live alone the safest bet is to reach out to carriers to see how they handle it. Each is different. If your parents have insurance you may be able to be placed on theirs. A few points to know if you do live alone with a learners permit:
- Typically you have to get a full policy within 30-45 days.
- You might need to have the policy started by someone who has a license already.
- If you are under 18 you will most likely have to have a parent/guardian sign.
Living With Spouse or Significant Other
If someone gets their permit and is living with a spouse, significant other, or roommate, they may get coverage under that person’s policy. Again, this depends on the state and insurer. In some jurisdictions, the learner may need to be added to the policy right away. In others, they need not add themselves to the policy until fully licensed.
Learner’s Permit Insurance Cost
What’s the Cost?
We will not sugar-coat it. Having a permit or newly licensed driver on your policy will raise your rates. In a study done by the Insurance Information Institute, they found that adding a teen boy or girl could raise rates by 100% or 50%, respectively. These increases also vary by state.
Why Does it Cost More?
New drivers, and new young drivers in particular cause higher rates for two reasons. Namely, lack of experience and statistical likelihood of immaturity. Like anyone learning something new, mistakes are more common at first. The same goes for risk-taking.
Ways to Save
When adding a teen driver to a policy, there are a few discounts that can soften the blow. We list the most likely candidates below.
Good Student Discount
- Maintain a B average or better (grade requirement varies by insurer).
Part-time Driver Discount
- At college without a vehicle. Only drive when at home during school breaks.
Safe Driving Discount
- Complete a driver’s education course.
A parent should consider if their current insurer offers them the best rate with a newly added driver. Making policy changes often serves as a good time to shop around. See if other insurers have a better deal available. This process should begin awhile before policy renewal.
When a new policy goes into effect, the transition must be seamless. Having a lapse in coverage (even for a day) can lead to surprising increases in price. There are also discounts that apply when getting a new policy to be aware of.
Should Teen Drivers Get Their Own Policies or Go on Parents’ Policy?
This comes down to preference. Having them on the parent’s policy will increase rates. But having them on their own policy will likely cost more. These costs can often be somewhat offset by discounts for more than one vehicle or good grades.
Learner’s Permit Process & Restrictions
How to Add a Teen to Your Insurance Policy
Some insurers allow you to add your teen online–likely the easiest option. If online policy modification proves unavailable, you will have to call in. Fortunately, insurers are familiar with this transition and should make the process easy.
Teen Driving Restrictions – What are the laws/when should they be driving?
A learner’s permit gives a driver permission to drive with certain restrictions. These come from “graduated driver licensing” (GDL) laws that exist in every state. They reduce the risk of young drivers by ensuring they build experience over time under lower-risk conditions.
All states have a three-tier system allowing the driver more responsibility over time. Restrictions include nighttime driving, having other teen passengers, and supervised driving time. These rules have enabled a 10-30% reduction in crashes. The IIHS has created a handy table of requirements and restrictions for each state if you want to learn more.