Answer: Ouch. 79%!

From Money:

According to a new survey from InsuranceQuotes.com, the average premium increased 79% after adding a driver between the ages of 16 and 19 to an auto insurance policy in 2015. Sure, that’s a lot, but it’s down five percentage points from 2013, when families in the same situation saw their premiums jump 84%.

And because boys will be boys, it’s more expensive to insure a young man than a young woman; the survey found that the national average for adding a teenaged boy was 91%, versus 67% for a teen girl.

Here are some great follow-up questions to ask your students about this resource:

1. Were you surprised by how much insurance premiums are affected when a new teen driver is added to the policy? Why or why not?

2. Why do you think insurance premiums rise by so much? What is the risk of adding a new driver to a policy?

3. Do you think there is a difference between adding a teenage boy vs. a teenage girl to the policy?

4. Do you know how much your insurance policy premium increased (or would increase if you are not currently driving) when you were added?

Want this resource and questions in slide format to use in class? Click here!

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Check out the NGPF Activity: Car Insurance Comparison Shopping

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.