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Auto Insurance for Teens

Summer is Over… and that Means More Teens on the Road!

Summer will officially be over on September 21, but most kids in Colorado have already started the school year. While most parents can’t wait for their children go back to school, some who have teens are a bit apprehensive. Why? Because many teens will be driving themselves to school for the very first time. This can make parents of new drivers very nervous and makes auto insurance for teens top of mind.

It’s Important to have the Right Auto Insurance Coverage when You Have a Teen Driver

Not only are your teens new drivers, but navigating a high school parking lot can be overwhelming for teenagers. Any time hundreds of young drivers are grouped together in a parking lot, accidents are sure to happen. This is just one reason it’s important to make sure you have adequate auto insurance when you have teen drivers. In other words making sure you have adequate auto insurance for teens at this time of year is especially important!

According to the National Highway Safety Administration, “Young drivers, ages 15- to 20-years old, are especially vulnerable to death and injury on our roadways – traffic crashes are the leading cause of death for teenagers in America. Mile for mile, teenagers are involved in three times as many fatal crashes as all other drivers.”

Here are some other scary facts about teen drivers:

  • Teens (16-19) are 2.5 times more likely to get into an accident than the next highest risk age group (20-24).
  • The likelihood of a teenage driver’s being in an accident increases with each additional passenger in the car.
  • Youthful drivers pay the most for auto insurance because they are the highest risk.

So, Mom and Dad… get ready for your rates to go through the roof when your teen is a fully licensed driver! But auto insurance for teens can be kept under control if you are careful.

What You Can do to Reduce Your Policy Rates for Auto Insurance for Teens

  • Enroll your teen in a driver education class. Completing this type of class can often result in an auto insurance discount.
  • Make sure your teen focuses on school. Good grades can earn your teen a “good student” discount with most insurance carriers.
  • Avoid high risk cars. Although your teen might think it’s cool to drive a fast sports car when they are in high school, it can  drive up your rates.
  • Limit your teen’s passengers. Only allow your teen to drive alone or with a maximum of one other person in the car. Fewer people in the car means fewer distractions.
  • Do not allow your teen to use a cell phone while driving. No texting either!
  • Encourage your teen pay for his or her own auto insurance – or at least part of it. If teens pay for it, they’re likely to show more respect for their driving privilege.

Colorado Driver’s License Requirements
for Teens

In order to obtain a driver’s license in Colorado, a teen must:

  • Hold a permit for at least 12 months
  • Be at least 16 years old
  • Complete and sign a drive time log
  • Get a 6-hour behind the wheel certificate if they are younger than 16 years, 6 months
  • Pass a driving test
  • Provide their social security number to the Department of Motor Vehicles
  • Show their proof of address

If your teen is just getting behind the wheel, please call us to review your auto insurance. We appreciate the stress parents feel with new teen drivers.  Our goal is to increase your peace of mind by helping you have the right auto insurance in place to protect your teen and manage your risk.   Call us at 303-777-2991 or e-mail us today.

Colorado Insurance: Who Needs Umbrella Insurance

by Cindy Chase

In today’s litigious world, I think umbrella insurance policies are a must.  Why? In exchange for a small annual premium, you get a significant amount of protection against the unexpected. Here is how the policy works.

  • Umbrella insurance is a special kind of liability policy.
  • Liability is the amount of money you are responsible for paying when an accident is determined to be your fault.
  • Umbrella policies  provide an extra layer of protection over and above coverage in your primary policies such as automobile and homeowner’s insurance, which have limited liability benefits.

Your umbrella policy kicks in and protects your property and assets from claims against you, when your other policies are depleted. Claims can include things like medical payments and lost wages due to negligence. Or, it can cover legal bills if you end up in court.

What Would Happen to Your Financial Assets
in This Situation?

Consider the situation of a car accident. Let’s say the judge decides you’re responsible for $750,000 in damages. In addition, attorney fees come to $250,000. That’s a total of $1 million. If your automobile policy only covers $500,000 in liability, you would have a balance of $500,000 to pay.

How would you get the remaining $500,000?  More than likely, you would have to sell personal assets like your home, jewelry or other personal property. Or cash out retirement and stock accounts.

But if you have an umbrella policy worth $1 million, the remaining $500,000 would be covered and paid. The result would be a zero balance, and you would have no other financial responsibility!

Today with the average cost of damages increasing and the affordable cost of umbrella policies, I recommend umbrella coverage to all my clients.  Our goal at Aspen Insurance is to protect you before you need it. An umbrella policy provides increased peace of mind in the event of the unexpected.

Umbrella Insurance Coverage and Cost:
How Much is enough?

Everyone’s situation is different.  Evaluate the following three factors to begin to answer how much is enough?

  1. Look at the amount of liability coverage you currently carry in your homeowners and auto policies.
  2. Next determine your financial assets. What is the value of things like your home, cars, jewelry, stock or retirement accounts, etc.
  3. Now look at your risks…the factors that could influence the likelihood of getting hit with an injury claim or lawsuit by someone else. For example, do you have teenage drivers, how many drivers are in your household, do you have a pool, do you own pets?

Umbrella coverage starts at $1million with an average annual premium of $200.  This fee is dependent upon the number of drivers and vehicles in your household, so the exact cost will vary.  But the point is, it’s very inexpensive coverage that provides additional liability protection for everyone in your household…should you need it.

Remember to Include the Fun Stuff

And remember many Colorado residents enjoy the great outdoors with “toys”. If you own a snowmobile, motorcycle, boat etc. you must add them to your umbrella policy. If an accident occurs while using them, you may be faced with liability damages that exceed your policy limits.  In order to get the extended protection of your umbrella policy, they must be listed on your policy.

If you’d like to discuss your situation and the right amount of umbrella coverage please call 303-777-2991 or send me an e-mail.