We all know auto insurance rates for teens can be through the roof. Unfortunately, this is simply because teens are proven to be higher risk for insurance policies. Consequently, it costs more to insure them. But what are some things you can do to make sure your teen’s insurance rates aren’t breaking your wallet? Here are a few tips:

Make sure your teen is getting good grades in school

Many insurance companies give a 10%-25% discount to students who have a B average or better. While there is no direct correlation between driving skills and grades, they are seen as “more responsible” and appear less risky compared to students with lower grades. Provide incentive for your teen to get good grades. If he’s helping to pay the insurance bill, he’ll be more motivated to get better grades to reduce the overall cost.

Don’t report every little ding or fender-bender

If you report these, insurers will bump up the premium. When you’re trying to keep the rate as low as possible, it just doesn’t make sense to report these. If your teen is involved in a small fender-bender type accident, compare the costs of what it may take to fix the problem without your insurance company compared vs reporting it to the insurance company. If it’s going to bump up the insurance rate for longterm, it may make more sense and be more cost-effective to just bite the bullet and deal with it yourself.

Have your teen take a driver’s safety course

Defensive driving classes can cause your insurance premium to go down with many insurance companies. Call your insurance provider or look online to see if they offer this deal – many do. This could save you 10%-15% more on your insurance rate for your teen.

Avoid buying brand new cars

This is a quick obvious tip – new cars are always going to cost more to insure than older ones. Don’t buy the latest year model when you can buy older used cars that still have fantastic safety ratings. You’ll save money on both the car and the insurance.

Consider liability only

This stems from the last tip, you may want to go liability only for your teen’s car. If you really want to save money, buy a car for around $5k  or under and insure it this way.