Getting a driver’s license is a milestone. For whoever pays the insurance bill, it is also a new line item.

Answer: $286

Insurify reports that adding a teen driver raises a family’s car insurance premium by 90%, which works out to an extra $3,435 a year.

Questions:

• Should a teen driver help pay the extra insurance cost, or is that a parent’s expense? Why?
• Would you rather pay about $3,400 a year to drive your own car, or spend that money elsewhere and find another way to get around?
• Insurers charge young drivers more because that age group is involved in more crashes. Is that a fair way to set prices? Why or why not?

Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the Numbers: (Insurify)

Staying on the family policy is still the cheaper route. A teen on a separate policy averages $4,514 a year, roughly $1,079 more than joining their parents’ plan. Adding a speeding ticket pushes a teen’s own policy to an average of $5,412. 

About the Author

Yonathan Tadesse

Yonathan is a Dallas-based Curriculum Designer at NGPF with 12 years of experience as a high school math, college transition, and financial literacy teacher. An award-winning educator, he has a track record of launching innovative programs at the high school level that expand access and opportunity for students. He is a graduate of Emory University and is passionate about advancing financial education for all students. Outside of work, Yonathan loves spending time with his wife and two kids, working out, playing chess and poker, and learning new things.

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