What Should Your Kids Know About Car Insurance?

Insurance can be a daunting thing — choosing the right insurance, understanding your insurance, knowing what’s covered and what’s not. This can be complicated when you’re doing it for yourself, and usually becomes more so when adding your teen drivers. Most of us, if we haven’t already, will reach the point when our kids turn 16 and get their driver's license. After that, it’s a few years of holding your breath waiting for your child to experience the life lessons that we all learn in our first few years of driving. As young drivers we’ve all been there, and as parents, many of us will experience it. So, what can you teach your kid about their car insurance as they are preparing to drive to make sure they know the responsibility of driving a car?

First off, what do those limits listed on your car insurance policy mean? Usually, your bodily injury liability limits are going to be listed first. The basics of these numbers are: if you are responsible for an accident, you have X amount to pay for medical expenses of one person involved and Y amount for everyone involved. For example, if your limits are $250,000/$500,000, you are going to have $250,000 for one person’s medical expenses and $500,000 for the expenses of everyone involved in the accident needing medical attention. With the cost of medical expenses in today’s world, we recommend setting these limits as high as you can, usually 250/500 if possible. Next up you’re going to have your physical damage liability limits. These are going to come into play if you are found at-fault in an accident and must pay for the damage to other vehicles or any other physical property. We recommend setting this at $100,000. Next, you have your uninsured and underinsured motorist coverages. These two coverage limits are going to match your bodily injury and physical damage limits but cover any damage/expenses to yourself that any at-fault driver’s insurance does not - like if they do not have enough insurance or do not have any insurance at all.

Next, what is defensive driving? Defensive driving is a term that we have all heard, learned about, and have more likely than not used these techniques while driving. But what does it really mean to be a defensive driver? Driving defensively, contrary to what you might think from the name, is not driving aggressively or with a chip on your shoulder but driving in a way that uses safe driving strategies to see the hazards that the road and driving present. Some of these techniques include planning ahead for the unexpected, controlling your speed, preparing to react to other drivers, respecting others on the road, and being aware of special road and weather conditions. Driving defensively simply means being aware of your surroundings while operating a car and being prepared for when other drivers do not do what’s expected.

Lastly, what do you do when you’re in an accident? See our blog post here for a step-by-step guide on what to do following an accident.

Learning to drive a car and getting a driver’s license is a rite of passage that most will experience, both on the end of being the driver and the parent sending their child off. As parents, the best thing we can do is prepare our children to be responsible drivers - through instilling principles of defensive driving and encouraging focused, safe driving habits.