I am in the process of getting quotes for adding a 17 and 16 year old to my car insurance.

We have an agreement that I will buy them a car (clunker) to share, and I will maintain it. They will have to pay for the difference in insurance cost and gas.

I know this forum is frequented by both the young and middle aged. (nobody old). Is this a fair agreement? Generous?

Both boys are above 3.5 GPA, which helps with some insurance companies, but the costs are unbelievably high: about $100/mo for each son, unless I reduce coverages.

Clark Howard recommends companies with an A++ rating from AMBest, and I will probably go with that.

Will,

It sounds fair on the surface but you're going to come across problems. For example... The costs of insurance may prove difficult for a 17 or 16 year old to handle. Is it safe to assume they'll both have part-time jobs? If not, then you'll have to make sure they can find a way to come up with the money.

Gas will prove even more difficult because how will you determine how much in gas money each child will pay? It's possible via tallying mileage driven but in the end it will prove very inconvenient and possibly lead to arguments about who put more mileage on the car.

There is also the question of determining who gets to use the car and when. Even if they put together a schedule, no doubt there will come a moment when both teens want the car at the same time, i.e. one wants it to take a lady friend out to a movie but the other wants to hang out at the mall with his buds. I like to think they'll work it out but that will definitely not always be the case.

Robert

So....... You think I should buy 2 cars???

I am on my 6th child with this arrangement. Two girls and 4 boys. Handed down our old car and/or bought a sub $2000 car mechanically sound. I didn't reduce coverage but I also didn't insure car.(comp) They knew if they had an accident, it would mean no car or THEY would need to repair or replace. On maintenance for the boys, we would split costs and I would help/teach them how and do the repair ourselves. The girls got off a little easier since they were our first two and got our slightly newer hand me down. I went with no money for insurance then no license. I chose to share maintenance with them to teach them a little about the true cost of owning a car. Bottom line is that I made sure it was dependable and SAFE and they learned how to take care of a car. I think I have been lucky with only two dented fenders and three speeding tickets with 6 kids over the past 16 plus years.

I went thru that a few years ago with my oldest son, so I feel for you. Lots of ins. cos. will give a discount for honor roll/high gpa's, as you mentioned. And some will give additional discounts for driver's ed training, even thru their high school. Take whatever discounts you can get. It never hurts to ask.

I think your agreement is very fair. The gas and insurance are their "consumables", so they should pay for them since that will teach them to budget their money accordingly. And if they get a ticket, it will also affect their insurance cost as an immediate negative reinforcement. But, I agree with you getting them a car for many reasons, top of which is that you can make sure it is safe for your boys. However, I would strongly recommend that you involve your boys in the maintenance aspect. And that goes for daughters too. It is a set of basic skills everyone should know: checking fluid levels and tire pressure, changing oil and filter, monitoring for signs of wear on tires/belts/hoses, batteries, and antifreeze. Also, a few basic things to keep in your car for road trip safety and how to use them.

Good luck!

Unless there is a real need for them to have a car of there own, I say make them wait (and save) until they are 18.

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Aloha, Ken


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Buy yourself an extra car. Get the extra coverage.

Borrowing Dad's car is going to be a lot easier for all of you in the end.

(this doesn't work if you become a chauffer to getting them to jobs)

I'm assuming both are still in high school and are not working .

This won't work after they graduate. By then they'll want/need their own car.

Bicycle is better exercise.

Two cars means they will be both full time drivers on each car thus higher insurance cost. I had more that two drivers most of the time but no one took a car to college. All my kids got part time jobs as soon as they could and I made sure they paid their own insurance or they couldn't drive. For the most part, they shared the car/cars with little problem. High school kids drove to school together and would help getting each other back and forth to work. Sometimes they would drive our car to work to free their car for other one to use. Part time jobs limit the need to drive other than to and from work and means there is less time on the road to worry about. The car was still ours and if it became a problem, it stayed home. They don't have a car now so you must be taking them everywhere. This will help that and if two cars are not a monetary problem then go for it. Same rules apply. At one time we had three extra cars for 4 kids to drive when they were all home.

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slbett
. . . They don't have a car now so you must be taking them everywhere. . . .

Amen. I don't know what's going to be worse - not having to drive my kids all over town or worrying about them driving all over town.

Addressing a few points:

Yes, we are driving them everywhere, although they get rides from their friends sometimes, which worries me more than if they drive themselves. I have given them plenty of practice with their learner's permit, and I trust them to be safe. The biggest worry is a bunch of teenagers driving and talking, and I reinforced that point ad nauseam.

Part time jobs are a must, but making a couple of hundred per month should be feasible even with homework, honor society, soccer and cross country.

I agree that bicycles are great, but we live in the country and it would be way too time consuming.

My parents did for me and my brother what my Grandpa did for my Dad. They (parents) would pay for the insurance, but my brother and I would have to pay for our own cars.

My parents would help (should we need a co-signer, etc.), but we were responsible for the payments, etc. It taught me and my brother the value of the vehicle...how to appreciate and take care of something we were paying for, and just the overall process of loans and monthly payments, etc.

We were involved in many extracurricular activities and sports, college night classes, etc...and we still were able to get it done. I believe the loan for my first car was around $3500...about $116/month for the payment. That was a weekend gig at a restaurant or something.

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I agree with onthedownlow. Have the kids pay (in sweat and money) to take care of the car and perhaps start chipping in for a fraction of the insurance cost. I figure that any teenage boys should be working on their own car anyway, otherwise they'll grow up to be helpless in tangling with auto mechanics.

You might want to check out something that I found out. At least here in California, if the kid doesn't have a car, then they assign him/her to the most expensive car, leading to high insurance rates. For example, my wife and I have a Mercedes and a BMW, so my daughter was assigned to my BMW so the rates went through the roof. We helped her to buy a Miata and since she is now officially assigned to that car the rates went way down. Go figure...three cars is cheaper than two cars, even though previously she was hardly driving at all since our two cars were seldom available. It might be that helping your sons buy a car each could actually lower your insurance payment (only if they are low rate cars, not Mustangs or some such). Check with your agent to be sure.

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Edited 2 time(s). Last edit at 09/20/2007 06:01PM by davester.

Please check with your broker about liability coverage. If your kids, by some chance, cause significant property damage, injury, etc., the policy will exhaust itself and then, as they are a minor and it's your policy, I think the injured can then come after your assets. It was for this reason that my parents got some "umbrella policy" when we were teens that covered up to like a million bucks or something (in the 80's)....

kiva

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Insurance is the key. You (and kids) have to be covered. I made mine pay (give me the money and i paid for insurance) first. They may drive someone else's car (with or without your knowledge) even if they don't have one of their own. You must be covered. Your junker (safe) is the same method I took. One of the cars got passed through three of my 6 kids. Once they get out of high school and don't intend to go on to college then help them however with a nicer car. With their grades, they are probably going on to college so their isn't much need of their own car while away at school. Once they graduate, they might want a new car and there are usually first time buyer deals when you get a new car.