AUTO INSURANCE VS. THE AVERAGE TEEN

You thought taking your teenager out to a deserted parking lot and putting them behind the wheel was scary. Just wait until your auto insurance agent gets through with you! Don't give up hope. There are things you both can do to help.

Auto insurance is run on statistics. With the advent of the billion gig mainframe, they can crunch more numbers than a teething toddler can crunch fingers! Which means for you that your next auto insurance bill might be literally tailored to you. Or, to your teen driver!

Statistically, it is virtually guaranteed that an inexperienced driver of any age WILL have some type of accident in their first years of driving. So, auto insurance companies will charge more for a new driver.

It is even shown that when any driver changes the type of vehicle driven, an accident is much more likely to occur in the three years following the change. So what can you do to keep your auto insurance rates down?

First, DO NOT change companies! You need every break you can get, and that claim-free discount for the years with your auto insurance company will not transfer to a new company. On the other hand, shopping doesn't cost anything but time. Get another quote. If it's a lot lower, let your current agent know.

Second, make sure your new driver has his or her OWN car. I know that's a scary thought, but in most states, if you have more drivers than cars, the auto insurance rates the highest risk- your teen- on the most expensive vehicle, whether or not he ever gets behind the wheel. It may well cost less to buy and insure a third vehicle that it would to pay the premium on the young driver. Get a quote both ways; you'll be shocked.

Third, ask your agent about good student discounts. Most companies give better rates for good grades. I guess they figure she's too busy studying to drive very much. There are also discounts for certain clubs and achievements. It never hurts to ask. Auto insurance companies are always looking for the best risks. If you have a good student, check for this discount.

Another often overlooked item is to, if your young driver goes off to college taking a car with him, make sure the car is listed in the county in which the college is located. Quite often the auto insurance rates are lower, especially in rural college towns. If the student lives in that county, or that state, then the car should be rated there.

So, even though you can't avoid the 'sticker shock' of insuring a young driver, you can lessen the impact with auto insurance discounts, driver training credits, and, of course, a good driving record for the teen. Make sure your young driver understands that any ticket or accident is going to raise his insurance for THREE years, on top of the high premiums. If you scare him enough, he might even be careful!

Driving On The Job: Commercial Or Business Class Auto Insurance

What are you doing when you're "running" a few errands for the boss determines the kind of auto insurance coverage you need. Other than samples or signs, do you carry merchandise? How often? How far? You really want to do the right thing, but what is it? Regular auto insurance is hard enough to figure out. Now this comes up! Get a quote. A new job might be cheaper!

If you are a salesman who drives from store to store, or state to state, for that matter, but carry nothing but samples, literature, signs, and tools, then most states allow you to carry a business class on your personal auto insurance policy. Be sure to get more than one quote!

If, on the other hand, you are selling and delivering goods that you sold, or were attempting to sell, then you would have to have a commercial auto insurance policy. Clear as mud? Call your agent to clarify other situations.

Many employers have their employees use their own cars to do company business. Even if it is only to go to the bank, or deliver papers, if you are being paid to drive, then you must carry business class auto insurance on that car.

On the other hand, if you are delivering merchandise to a customer in your personal car, then you must carry commercial auto insurance. And whether or not you are compensated for the driving, you still are responsible for the right coverages. Ask for a raise, and get the lowest quote possible.

So what happens if you are in a wreck with the wrong auto insurance? Well, it depends on the mood of the officer on the scene. If you are delivering donuts, he'll probably get rid of the evidence for you and let you go with an appointment with the judge. As for who pays for the damage, it depends.

Most of the time, if the auto insurance company feels that you simply made a mistake and didn't know that you needed business rating for driving for the company, they will simply raise your premiums to cover the proper rating. But this is purely at their option.

They could also cancel your policy. If they do, then you will find it hard to get affordable insurance anywhere else. The days of being able to switch auto insurance companies just after a wreck or serious ticket to avoid the higher insurance rates are gone. Most companies share data on 'high risk' drivers. And you will get quotes so high that your nose will bleed!
So which do you need? Basically, if you are driving for the company but not hauling merchandise, a 'business' rating on your personal policy is all you will need. But watch the fine print. Most companies who require employees to use their own vehicles also require them to carry higher liability limits. If you are carrying merchandise or selling from your car, then you must have a commercial auto insurance policy.