The NC Teen Driver Insurance Loophole – This Simple Trick Could Save You Hundreds of Dollars


Although the North Carolina law has closed the old loophole that allows young drivers to get car insurance, it is still possible to use this tool to cut down on your auto insurance expenses by hundreds of dollars per year. It is important to know what and when you should ask.

First, let’s talk about the rating system for teens. Your rates will rise to shocking levels in North Carolina when you add your teenager driver to your policy. These rates are temporary, but they don’t last forever. The insurance company may increase your policy’s 3 year “inexperienced driver period” to reflect the fact that teenage drivers are more likely to be in an accident and have more serious injuries.

How does it all work? There are three tiers. One for each year of driving experience a teenager has. Your policy will be surcharged the maximum amount for your teenager’s first year as a driver. Your teenager can technically be rerated to the second tier after one year of driving. However, there are lower surcharges. Your teen driver should be in the lowest of these three experience periods surcharges for their third year. Problem is, the timing of your child’s experience might not coincide with your policy renewal dates. You may end up paying additional surcharges to your insurance company.

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Let’s look at an example. Let’s say your auto insurance policy renews every year on January 1. Let’s suppose that your auto insurance policy renews on January 1st and runs for one year. Your teen driver is added to the policy on February 1, the day she receives her license. Your insurance company immediately charges your policy with your girl at the highest rated inexperienced operator Tier. You complain, you pay the extra money, and hope that your child doesn’t get into an accident or receive any tickets. Your policy will renew next year on January 1, and because your daughter is still learning to drive, the renewal price has the highest surcharge. Your daughter will now have her first year of full-time experience on February 1st. As she becomes an inexperienced driver, you can expect your rates drop. The problem is that the insurance company does not have to transfer your daughter to the middle-tier. They can just refund some of your money. They can hold off until your next policy renewal, which is January. This would mean that you would have to pay nearly a year more for the inexperience driver surcharge.

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You would be mad if you found out the exact dollar amount of an overcharge and had to pay it. Clinard Insurance Group, Inc is able to save a family of teenage drivers $387 each year by forcing insurance companies to reduce the surcharge on the anniversary of their teen driver’s license. How do we do it? It’s really quite simple. We are experts in insuring teens and their families. This means we know which insurance companies will allow the surcharge change in the middle or end of a policy term. Because we have so many clients with teen drivers, we know which insurance companies will allow us to change the surcharge in the middle of a policy term. We will not recommend that clients purchase insurance from a company if they won’t permit it or the timing is poor.

What can you do to ensure that your teen driver is not overpriced? Use an independent agent that is familiar with the intricacies of insuring teens drivers. Second, you should always purchase policies within the shortest possible timeframe while your teen driver is on your policy. If your company refuses adjustment of inexperienced operator surcharges during the policy term, many companies will allow you to purchase a policy for 6 months. This can be advantageous.

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Clinard Insurance Group is headed by Wake Clinard in Winston Salem, NC. He is committed to helping North Carolina families with all their insurance needs, from auto and home insurance to life, disability, and annuities. Wake’s own experience as a parent of teenage drivers inspired him to create a comprehensive program that includes technology and tools to help parents keep their kids safe while helping them become safer drivers.