Auto Club: Insurance Lesson Plan for Teen Drivers.

Business/Automotive Editors

LOS ANGELES--(BUSINESS WIRE)--Nov. 21, 2002

Driving lessons aren't all teens need to be prepared to use a car -- they also need insurance, according to the Automobile Club of Southern California.

Also, since auto insurance ranks behind car payments as the largest annual cost component of a new car purchase, teens need to learn how to become savvy insurance consumers.

To help young drivers learn the basics of auto insurance, the Auto Club has developed an information guide titled "Auto Insurance Guide for Teens." The guide describes how an insurance policy protects a car owner and defines various components that make up an insurance policy.

"Buying insurance, especially for the first time, can be confusing for some people," said James Gilmartin, senior vice president of insurance. "We've supported many efforts to help teens become good drivers. Now, we'd like to provide help becoming a good insurance consumer. We believe the Auto Club's insurance guide provides clear definitions and background that teens will find useful."

Included in the guide are the following insurance buying tips for young drivers:

-- Check the insurance rates for the model, year and features that you want on a car before you buy. A sporty two-door may look nice, but it will cost far more to insure than an economy car -- historically, drivers of faster cars have a higher rate of collisions and traffic violations.

-- Drive safely -- Common sense says that a driver with a clean record will pay less for insurance than one with tickets and accidents. Remember that drivers can be easily distracted by their passengers or by activities like talking on a cell phone or changing the radio station.

-- Compare discounts -- The Graduated Driver License Law of 1998 added driving requirements and restrictions to help improve teen driving. Because of this, some insurance companies may offer discounts to young drivers. Also, check for good student discounts.

-- Determine how increasing or reducing the deductible will affect your annual payments -- A higher deductible means a lower payment, but it does mean paying more out of pocket if the car is stolen or the driver is found to be at fault in a collision.

Other policy savings may come from car safety features, garage parking, multi-policy or multi-vehicle discounts.

Also, young drivers need to know the definitions of an insurance policy's key coverages and what they provide, including Liability, Medical, Uninsured Motorist, Physical Damage and Rental Car. The coverage provided by different insurers may vary.

When buying insurance, new drivers need also to ask the agent how the claims process works following an incident. Some insurers require claims to be filed with a phone call to a toll-free number, while others want claims filed with the agent.

The Automobile Club of Southern California, the largest affiliate of the AAA, has been serving members since 1900. Today, the Auto Club's members benefit by roadside assistance, insurance products and services, travel agency, financial products, automotive pricing, buying and financing programs, automotive testing and analysis, trip planning services, highway and transportation safety programs.

Information about these products and services is available on the Auto Club's Web site at www.aaa-calif.com.