Why do Teenagers Have Higher Insurance Premiums?


Before we delve into the details as to why teenagers have higher premiums, let us first analyze the situation.

So Mom and Dad finally bought you a brand new car or maybe you were able to buy one through a part time job. But what do you do next? What makes the entire driving experience complete? Apart from any of the two main reasons mentioned, there is actually a step two after this process and it is the need to apply for insurance.

Now, why do you think teenagers have higher insurance premiums?

The reason is simple. Like in any basic course or any beginner level, we are most likely to make more mistakes figuring out how to respond to situations in driving than when we are advanced already or used to what we’re doing. When we are taking our baby steps towards the driving essentials, there is a high tendency to hit another car or possibly run over a fence. Regardless of age, the bigger picture presents that beginner drivers DO make more mistakes than most and through their bigger potential of getting hit by another, more expensive repair treatments are made and more damages are done. Insurance companies are obviously worried about the negative effect excessive damages have on profit and on financial control. The more accidents the client gets into the more they have to pay and usually this does not have any positive gains for the company.

Insurance companies don’t just declare such policies or deals without bigger reasons behind it.
Frankly speaking, these insurance companies have already done their research and statistically proven that more accidents and unexpected car accidents take place among teenage drivers. This just means that to keep their company afloat, certain rules must be done to be able to control the flow of income and the quality of service. The higher the insurance premium, the better service you get if ever you face any car trouble or problems. Better premiums, although a bit more expensive, are usually worth the pay because it guarantees higher measures of service for teenagers. With a slightly higher amount in teen insurance premiums, the client as well as the company is assured that all will be taken care of and done.

With better premium rates for teens, there is a better chance of service and safety on the road. Therefore, it is only right for insurance companies to create a higher insurance premium for teenagers.