Teen Drivers Face High Auto Insurance Rates

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Texting while driving may be one reason for higher insurance rates.


Adding teenagers to a family’s automobile insurance policy increases rates by an average of 168 percent, according to the insurance comparison platform quotewizard.com.

Figures from the online “insurance solutions” company indicate that New Hampshire teens with full coverage pay an average of $6,699 annually for auto insurance, compared to $3,501 in Vermont and $3,523 in Maine. Massachusetts’ rates are roughly the same as New Hampshire, at $6,065 per year, while other New England states have higher rates for teens: $10,840 in Connecticut and $11,030 in Rhode Island.

The national average, according to quotewizard.com, is $6,727. New York’s rates are the highest, at $14,899, with Louisiana having the second-highest, at $12,412. Hawaii’s rates are lowest, at $1,693, and North Carolina’s are second-lowest, at $2,326, according to the website.

The New Hampshire Insurance Commission questions those numbers, with Director of Communications Andrew Demers responding, “The premiums that you reference are significantly higher than those that can be located on our ‘Comparison of New Hampshire Personal Auto Insurance Premiums’ sheet, hosted on our website.”

Rate filings with the state, effective June 1, 2021, show that a 16-year-old female in Concord would pay as little as $649 a year, and as high as $4,621, while a 35-year-old female in the same city would pay between $429 and $1,851. The teen still pays a higher premium, but the difference between the teen and adult can vary widely.

In the example above, the teen is described as “Single female, age 19. She drives a 2006 Honda Civic LX Coupe … six miles each way to a post-secondary school, five days a week and works weekends at a local restaurant, located two miles from her apartment. Her annual mileage is 10,000. She maintains a 3.0 grade point average and has had no accidents or moving violations in the past three years. She received her license at age 16 and passed an approved driver’s training course.”

Rates for male drivers are higher and, with accidents or other violations on their record, the $6,065 rate cited by quotewizard.com is conceivable, but Demers said, “Since I am not familiar with that site, and they do not provide any sources for the figures in their tables, I am unable to provide any comment on their specific numbers.”

The rates that are posted on the New Hampshire Insurance Department website show how location also affects the rates. That same teenager whose upper rate in Concord is $4,621 per year would see a top rate of $5,257 in Nashua, $4,384 in Portsmouth, and $3,728 in Berlin. On the other end of the spectrum, the lowest rate for each location is listed as $649 in Concord, $673 in Nashua, $686 in Portsmouth, and $735 in Berlin.

The average annual premium among all driver classes in New Hampshire in 2018 — the latest year available in the Auto Insurance Database Report by the National Association of Insurance Commissioners — was $883. That compares to $783 in Maine, $854 in Vermont, $1,246 in Massachusetts, $1,326 in Connecticut, and $1,500 in Rhode Island.

Why Higher Rates?

Demers said, “There are many factors that go into the calculation of premiums, such as driver history (including accidents and moving violations); type, age and cost of vehicle; average yearly mileage; and, to a lesser extent, territory.”

But the top reason that auto insurance rates are higher for teenagers is driver distraction, according to Gerry Kennedy of Alton, the chief executive officer of Observatory Holdings, a company that does underwriting and conducts risk analyses for insurers.

“They’re not drinking, and yet they’re having horrific kinetic accidents,” Kennedy said. “There’s no braking, it’s just smashing.”

He attributed the problem to youths’ addiction to cell phones. “You have youthful operators who are by their very nature tuned in,” he said. “And it’s not just youthful operators anymore; it’s an entire generation, from 2000 on. They communicate via texting. They don’t know what a pay phone is. They’re on these devices all the time, so it’s an opioid — that’s how we look at it — all the communications devices are an addiction.”

Kennedy said that, if a driver sends a simple text — “I’m on my way home. See you soon” — and he is traveling at 70 mph with his head down, “you’re a bullet at 3,000 pounds. You’ve covered the distance from end zone to end zone at Gillette Stadium without looking up.”

With statistics showing that four out of five people are texting while driving, Kennedy said insurers should be doing more to promote technology that prevents texting. For 10 years, he has been advocating for an anti-texting device known as Kyrus Mobile, which automatically disables texting, emailing, and browsing while a vehicle is in motion. Insurers could offer discounts for drivers who use the devices, but they have shown no interest in doing so, he says.

Demers commented, “While individual insurance provider discount programs are outside the purview of our department, the N.H. Insurance Department takes driver safety very seriously. The NHID engages in various community outreach initiatives throughout the year to help educate Granite Staters about the dangers of unsafe driving practices.”

He said an Insurance Department representative serves as chair of the New Hampshire Distracted Driving Task Force, an organization established in 2019 to promote safe driving practices and provide resources to others who focus on the dangers and consequences of distracted driving.

Distraction accounts for another of the reasons that teen premiums are higher: more severe crashes. “In 2017, an average of six teenagers died every day due to car accidents. Drivers between the ages of 16 and 19 are three times more likely to be in a fatal car accident than those over the age of 20,” according to quotewizard.com.

Other factors are teen inexperience and the number of citations they have received.

Nationally, there has been an emphasis on making automobiles safer through technology such as lane-change software and automatic braking.

“Autonomous cars are going to reduce premiums because the losses are going to go down across the entire demographic,” Kennedy said. “So now there’s a long-term liability of the autonomous vehicle basically making losses not happen at all.”

In the meantime, the collisions that do occur are more expensive to repair. “The average repair cost of a car has gone through the roof,” Kennedy said. “The BMW has 57 sensors. You get in an accident? They’re almost uninsurable.”

He said that youthful operators generally drive older cars, “but even the older cars can’t be repaired like they used to because the technology, even for them, has become difficult [to repair]. The technology won’t exist to keep them running because it’s going to be old.”

The best strategy for finding affordable insurance for teens is to compare rates among companies, keeping in mind their customer ratings — cheaper is not always better.

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