When to Add a Child to Your Auto Policy

By Carol Voorhis

woman holding car keys

The inevitable is here – your child is getting their learner’s permit. Did we just hear you scream in fear? We know this is a new adventure – filled with exhilaration and trepidation. But what does this mean for your auto insurance policy? Hanson & Ryan Inc. has been in the insurance business since 1876. Not only are we premier auto insurances agents in New Jersey, but we pride ourselves in treating our customers like family – and our passion is helping you protect yours.

Do I Need to Add My Child to My Car Insurance with a Permit?

When your child gets their learner’s permit, they are not added as a “driver” on your auto insurance policy. It seems counterintuitive because they are operating a vehicle, but they need a licensed household member with them to do it. Instead, we recommend adding them as a “permitted driver” or “household member.” Doing so will not increase your premium.

What happens if your child with a learner’s permit is involved in an accident while driving? In the event it does happen, your policy will respond to cover damages and/or liability – another good reason to ensure your permitted is driver listed as a household member on the auto insurance policy.

When Should I Add My Child to My Car Insurance?

You should add your child to your auto insurance policy when they receive their driver’s license. It is not necessary to add them before.

What happens if you forget to add your child to the policy when they get their license? This does happen sometimes. In this case, we will add your child on to your policy backdating to the day they received their license. The same would be true if you unintentionally leave them off your policy and they are involved in an accident with one of the covered vehicles. Your policy will still respond, and your child will be added to the policy by the insurance company backdating to the day they received their license.

How Much Does It Cost to Add My Child to Car Insurance?

Once your child is added as a driver on your auto insurance policy, your policy premium will increase. To calculate the increase, your insurance agent will ask which vehicle the child will be driving regularly. This ensures they are rated on that specific vehicle on the policy, but it does not prevent them from driving any of the vehicles in the household.

There are some discounts to look for when adding your newly licensed child to your policy, including:

  • Good student discount: If your child has an A or B grade average in school, they qualify for this discount. You will need to provide a copy of your child’s report card or transcript. You are eligible for this discount even after your child graduates high school if they keep an A or B grade average in college.
  • Driver training discount: Most companies offer this discount. You automatically qualify for this discount if your child had to go through driver training to get their learner’s permit.
  • Away at school discount: You are eligible for this discount if your child is attending college over 100 miles away from your home and does not have one of the household vehicles with them.
  • Defensive driving course: This discount can apply to all drivers in the household, not just your child, if they take a defensive driving course. AAA and other companies offer driver training courses for a fee. Sometimes the discount that comes from the driver training course may be minimal. We also suggest a driver training course when a driver has many violations or accidents.

The premium increase that comes along with adding your child to the auto insurance policy is significant. You may ask your agent to quote your child on their own auto insurance policy to see if it saves money. At Hanson & Ryan, we are happy to provide you with a quote, but we highly suggest keeping your child on your current auto policy especially if they just received their license and are still in school. There may be some additional discounts that apply on your current policy that would not apply on your child’s own policy such as:

  • Multi driver discount
  • Multi vehicle discount
  • Insurance history or loyalty discount: Most companies offer this discount based on the time you have been insured with them. The longer you have been with them, the better your discount.
  • Insurance score: Like a credit score, but this is a “soft” hit on your credit, not a “hard” one that would decrease your credit score. If your teen has no credit history, this can hurt your premium as well.

The most important thing – for your child and for your premium – is that your child drives safely by staying alert, obeying all traffic laws, and ensuring they are not sidetracked by a cell phone or other distractions. In the end, safety pays off and your premium will not increase more due to claims or violations.

New Jersey Auto Insurance Agents

Having a new driver in the family is both unnerving and exciting for parents and the new driver. But we can help put you all at ease. At Hanson & Ryan we suggest getting an umbrella insurance policy if you have a new or young driver on your auto insurance policy. Let us use our experience to support you. Contact one of our insurance agents today to get an obligation free quote.