10 states where teen drivers cost the most

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10 states where teen drivers cost the most

It’s no shock that adding a teenage driver to an auto insurance policy can be a hit to the wallet.  Teenage drivers are statistically the worst drivers on the road, their insurance premiums will reflect that.  But the financial hit can vary from state to state.

Researchers with Quadrant Information Systems looked at rate increases in each state when a teen driver is added.  The base rate was set using a married and employed 45 year old male and 45 year old female who drive 12,000 miles per year and have policy limits of 100/300/100 and a $500 deductible.  Using this hypothetical policy, they then added a teen driver.  The average increase was around 79%, but some states had significantly higher increases.  The top 10 are listed below:

1. New Hampshire: 112%
2. Rhode Island: 107.35%
3. Maine: 106.93%
4. Wyoming: 105.55%
5. Connecticut: 102.40%
6. Illinois: 101.42%
7. Oregon: 100.72%
8. Minnesota: 96.87%
9. West Virginia: 93.25%
10. Ohio: 93.09%

There are many variables that come into play with these rate changes.  Geography, driving culture, loss history, and local insurance regulations all play a part in the rate.

Surprisingly, states with fewer insurance regulations tended to have the higher increases.  For example, Wyoming, a low regulation state posted a 105.55% increase while states like Hawaii that has regulations that prevent rating by age, gender, or length of driving experiences posted only a 17% increase.  Of course, these regulations just mean the risk of teenage drivers is spread over all drivers all the time.  So the premium on this hypothetical policy were very likely much higher than the others to start with.

Our home state of Iowa came in at #18 with an average increase of 86.93% when adding a teen driver.

Photo Credit: State Farm | License

By | 2015-04-08T03:02:10+00:00 August 6th, 2014|Auto insurance, Car Insurance, Personal insurance|0 Comments

About the Author:

Brad Phillips is a Managing Partner with Phillips Stafford Insurance Group. Brad has been in the insurance and financial services industry since 2009. He spent time as a captive insurance agent before co-founding Phillips Stafford Insurance Group. Brad was named a "Forty Under 40" by the Des Moines Business Record as well as a 2006 regional winner and top-10 finalist for the Global Student Entrepreneur Awards, presented by Mercedes-Benz Financial and the Entrepreneurs Organization (EO). In 2007 Brad became a published author when he contributed a chapter to Student Entrepreneurs: Graduating With a Profit, a book exploring business ethics with an emphasis on entrepreneurial activities.

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