Student drivers in Grand Rapids, MI have it tough. Learning to drive isn’t easy, and they will soon find out it’s also not cheap. Once a teen gets their license, there are expenses like saving to buy a car, taxes, registration, gas, and auto insurance to pay for. When you are working simultaneously and trying to earn enough money to cover the cost of owning and maintaining a car as a high school or college student can seem impossible. But it’s not.
Michigan auto insurance companies understand student drivers have it tough today, and many offer steep savings on their insurance policies while you are a student.
How Auto Insurance Cost Is Calculated For New Drivers
Auto insurance companies in Grand Rapids want to minimize their risks. It means the safer a driver you are, the less you can expect to pay. The problem with new drivers is that they may be great but haven’t had the time and experience on the road to prove themselves.
As student drivers accumulate years of no-claims bonuses that reduce their monthly premiums. However, when you have nothing accumulated because you have never had auto insurance before, initial quotes can seem sky-high.
In addition, the CDC reports that teens between the ages of 16 and 19 are at the highest risk of a motor vehicle accident, making Michigan insurers reluctant to take on young student drivers.
Auto insurance companies do recognize that exceptions need to be made for student drivers because these calculations regarding the length of time driving and the number of claims don’t provide any insight for newbies on the road. This is where insurance discounts come in to help reduce the cost.
The Types of Student Driver Discounts
There are several ways that a student driver can obtain a discount on their new auto insurance policy. These will vary depending on the company, but you can look at the following in general terms.
Good Student Discounts
As a student driver, level of responsibility or risk cannot be determined by experience on the road, so Michigan’s auto insurance companies look for other indicators.
With ‘Good Student’ discounts, insurers assume that a responsible high school or college student will also be a responsible driver. Guidelines and expectation will often vary from insurer to insurer, but an example of what a Good Student Discount might look like is:
A student must maintain a 3.0 GPA in school and have evidence of their school performance in the form of signatures from their school professors or administrators or in the form of report cards.
These savings are often applied to both high school and college students. Eligible drivers must be considered full-time students and under the age of 25. Most companies in Grand Rapids will put an age bracket of 16-24 on this discount.
It is essential to be aware that if your grades slip with this type of discount, your premium cost will go up, or your insurance will become invalid.
How Much Can You Save With A Good Student Discount?
Savings can vary widely depending on the auto insurance provider. It is best to shop around. Student drivers may be able to find Good Student Discounts of up to 25%.
Grand Rapids Resident Student Discount
If your grades aren’t high enough for you to be eligible for Good Student Discounts, another avenue you can look into is Resident Driver Discounts.
It’s a type of auto insurance discount given to students studying away from their homes. The catch with this cost-saver is that it is only for students who keep their vehicles at home. If you move to a new city and take your car with you, you will not be eligible for a cost reduction.
The discount is offered on the premise that you are not at home; therefore, you will be driving less and have less risk of getting in an accident.
If you are a student who drives your parents’ car when you are at home or does not drive often, this could be a great option for you to look into.
Insurers often have specific guidelines for who can qualify for this type of insurance discount. For example:
If you moved to college but are not that far from your family home, you may not get the discount. Some insurers will have a set minimum distance, such as, your school must be 100 miles from your parents’ home.
How Much Can You Save With a Resident Student Discount
Like Good Student Discounts, Resident Discounts will have savings that vary from insurer to insurer, so it’s best to shop around. As you essentially become a secondary operator on a vehicle and will not be expected to drive much, the cost savings can be significant.
Getting a drivers’ license is just one of the many steps in the process. Easing the burden of vehicle ownership can make the responsibility less stressful. Don’t miss out on any student savings you may be eligible for.
Are you shopping around for auto insurance in Michigan? Get in touch with our team and learn more about how we can help you save on your insurance today!
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