What to consider when buying car insurance for your household

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Buying car insurance for yourself can feel like a daunting task. But things become even more convoluted when you have an entire family of drivers living under one roof.  

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Each member of your household likely varies in age, gender, level of driving experience, and the type of car they drive — among other things. These attributes all impact the type of insurance coverage they can qualify for and the premium they pay.  

Not surprisingly, finding an insurance policy that’s both affordable and serves everyone’s needs can be tricky. But the good news is: family car insurance can also result in some discounts. Here are some things to consider in order to help simplify the process and better navigate your options. 

Add teen drivers to the parents’ insurance policy 

Given their brief time spent on the road, it’s no surprise that drivers under 25 years of age face the highest insurance premiums of any demographic. That’s why it’s crucial for young drivers to compare car insurance rates. 

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As a result, it’s wise for teens to get listed on their parents’ car insurance policy as secondary drivers. While adding a driver who lacks considerable experience on the road will bump up parents’ premium, it’ll result in a cheaper rate for them than if they acquired their own policy. 

In addition, it’s an excellent way for them to gain the experience they need behind the wheel and build up a solid insurance history, which will enable them to get discounts on their own insurance in the future. 

Bundle multiple vehicles under one policy 

It’s always cheaper to insure multiple cars under a single policy than get coverage for each one separately. Plus, it’s easier to manage and track, as there’s only one payment to make each month and one deductible to pay when filing a claim. 

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In general, the more cars you add to a family insurance policy, the higher the discount you can earn. However, each insurance provider has a limit, so inquire with them beforehand, especially if you’re looking to add many drivers to the policy. 

Be strategic when choosing which driver to assign to each car 

By matching each driver with the vehicle that best complements their risk profile, you can drastically reduce your household’s total insurance premium expense.  

The optimal arrangement is to assign young and inexperienced drivers to older and cheaper cars as they cost less to repair or replace following an accident or other damage. Newer drivers’ premiums are already steep to begin with; listing them on older and inexpensive cars can help offset the amount they pay. 

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Conversely, old and experienced drivers should operate newer and pricier cars, as they cost more to repair or replace. With seasoned road skills and a driving record free of at-fault claims, older individuals benefit from more discounts on their policy, which helps counter the hefty premium.  

Select only the coverage you need and drop the rest 

Evaluate your household’s unique circumstances, risks, and needs to ensure the policy you choose effectively provides you with the necessary protection for each member. For example, adding an accident forgiveness endorsement to a teen’s policy may be wise if they’ve recently started driving independently. This popular insurance enhancement shields drivers from a premium hike following their first at-fault collision. 

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At the same time, drop any redundant coverage from your policy or avoid it altogether; otherwise, you’ll overpay for your insurance while reaping little to no benefits. For example, consider removing comprehensive coverage from older vehicles if the combined cost of the extra premium and deductible exceeds its market value. It may be more financially prudent to pay for any repairs out of pocket than file a claim with your insurance provider.  

Acquiring the ideal car insurance plan for your family can be overwhelming if you don’t know where to begin. Start by reviewing your household’s existing car insurance policy/policies to determine if there are ways to save. In addition to bundling multiple cars under one plan, there may be opportunities to obtain discounts that you previously overlooked. For example, student drivers can qualify for a variety of discounts not available to older drivers.  

Whatever way you structure your household’s car insurance plan, ensure you also compare quotes from several insurance companies. That way, you can increase your chances of finding a policy that provides your family with the coverage they need — without breaking the bank. 

LowestRates.ca is a free and independent rate comparison website that allows Canadians to compare rates for various financial products, like auto and home insurance, mortgages, and credit cards.