Car insurance costs tend to be higher for teenage drivers. This is because young drivers are calculated to be at a higher risk in the first few years they’re driving. Both high-school and even college students between the ages of 16 and 24 are considered as risky drivers. But what about a magical auto insurance discount that can help to save money on a student’s or young adult’s auto insurance?
Many insurance companies provide a discount to young drivers on auto insurance policies who earn good grades in school or college. The good student discount assumes that teenage drivers who are responsible, when it comes to their studies are more likely to be responsible drivers.
Discounts in auto-insurance
Many factors can be attributed to how much an individual has to pay for auto insurance. Customer loyalty, demographics, driving history, and safety equipment on a vehicle; all play a part in how insurance companies rate the premiums of a driver. Meeting specific requirements can give an advantage and sometimes dramatically reduce the monthly premiums. Some of these discounts can include:
- Safe Driver: Remaining accident-free.
- Equipment devices: Anti-theft systems, lock brakes, and hybrid vehicles also fall under this category.
- Bundling: Pairing auto insurance with homeowners or renter’s insurance.
- Account status: Signing up for autopay, paying the policy in full, and going to paperless statements.
Along with the mentioned discounts, A good student discount is also provided by some insurance companies. Young drivers who receive good grades certificate can be eligible for a dramatic discount on their insurance. Studies have shown that a student who receives A’s and B’s is more likely to be a responsible driver than a student who receives Cs and Ds. This discount may vary from company to company. In fact, some insurance companies do not offer this discount. Those insurance companies who extend a good student discount have certain qualifications that must be met:
- The age of the student must be less than 25 years.
- Be enrolled full-time in high school or university.
- Maintain at least a B average (3.0 GPA), or on the honor roll.
- Provide continued proof of good performance.
Understanding the Good Student Certificate Discount
Due to a lack of driving experience and their higher accident and traffic violation risk, teenage drivers face some of the highest insurance premiums. A good student certificate provides yet another incentive to do well in school and save money in auto insurance premiums.
All insurance companies are liberal to decide whether to supply a good student discount or not. If a company provides discounts, it is also free to set its own guidelines for those discounts. For instance; One insurer might offer a 25% discount on premiums to full-time high school and college students who receive good grades certificate, defined as a B average or higher grades, until age 25. Another insurer might offer a 15% good student discount to unmarried drivers with at least a 3.0-grade point certificate average in high school or college.
Any insurer who allows a good student discount may apply a condition to see proof of good grades in the form of a certificate for applying the discount. For homeschooled students who can’t show the traditional certificates, insurers may allow alternative proof, such as SAT(standardized test widely used for college admissions in the United States) scores that are in the top 20% of the national average.
Some standard terms of Good Student Discount
It is periodically verified by most of the insurance companies that the benchmark GPA is maintained or not by the students to continue their discount status. This verification can be done in the form of a certificate, report card, or a certified letter from the school administration. Therefore, having a poor performing semester could jeopardize a good student discount. Insurance companies may ask for any one of the following documents to apply the good student discount:
- A report card or online transcript.
- A Dean’s List or honor roll certificate.
- Confirmation of grades on the school’s letterhead.
- If applicable, a Home School certification signed by a parent and co-signed by a home school certifying body, such as the state’s Department of Education.
If a child does not qualify, or his/her grades drop, he/she can work on them. When the minimum requirements are achieved, he/she can revisit the issue with the insurance company. It’s also worth bearing in mind that not all insurance companies offer the same discounts. These rates may also vary by state, age, and gender.