Is car insurance needed for drivers with a learner’s permit?

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Joel Ohman
Founder, CFP®

UPDATED: Jun 21, 2016

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Here's what you need to know...
  • In most circumstances, individuals with learner’s permits do not need their own insurance policies.
  • Individuals with learner’s permits are usually covered by their guardian’s insurance policy.
  • It is important for you to know the specific laws regarding learner’s permit drivers in your state.
  • You must inform your insurer when you or your child receives a driver’s license.

Individuals with learner’s permits do not need their own car insurance unless they own a vehicle that is registered in their name. This is fairly uncommon, therefore, as a general rule, you won’t need car insurance until you get your driver’s license.

If you are ready to purchase your own policy, enter your ZIP code above to see side-by-side car insurance quotes online.

Abiding by the Law

If you are one of those rare individuals who need car insurance even though you only have a learner’s permit, keep in mind that having insurance does not give you the freedom to drive your vehicle outside of the terms of your learner’s permit.

Using the state of Vermont as an example, its Department of Motor Vehicles states that new drivers are required to have a licensed parent, guardian, driving instructor, or other unimpaired individual over the age of 25 in the passenger seat when driving with just a learner’s permit.

Each state is responsible for determining the type of insurance coverage required and how much each driver needs to have. To find out the regulations for your state, you should visit the National Association of Insurance Commissioners’ website.

Although car insurance for those with learner’s permits may not be required in your state, you still will need to make sure that the driver you are learning from has insurance on the car you will be practicing in.

Why don’t my teenage drivers need their own insurance?

Teenage Girl Learning How To Drive

The question of insurance with learner’s permits typically applies to teenage drivers. They don’t need their own insurance policies because they are covered by the policies of their parents or guardians.

It is generally assumed by insurance companies that such minors will be operating the vehicles of their parents or guardians, with those adults present most of the time. Therefore, minor drivers are allowed to be covered by the parent or guardian policies.

Furthermore, it’s highly unusual for teen drivers to own vehicles before the age of 18 or 19. This precipitates the need for them to borrow the cars of their parents when they need to drive.

Once a teen driver earns his regular license, he can be added to the policy of his parents without having to get his own.

He can stay on that policy until he moves out of his parents’ home or reaches an age somewhere in his mid-20’s, depending on the state in which he lives.

 Purchasing Car Insurance with Only a Permit

Purchasing insurance when you only have a permit is probably not the best way to spend your money.  Here are some reasons:

  • It’s difficult to find an insurer – The truth is, it can be pretty difficult to get car insurance if you do not have a driver’s license. Not all insurance companies will insure you if you only have a learner’s permit, so you may have to contact a number of companies and agents before finding coverage.
  • It’s expensive – Keep in mind that the cost of car insurance for teenagers is very high and it is even higher for drivers who do not have their licenses yet. There may also be a number of rules and restrictions if you end up getting insurance with only your learner’s permit.
  • A learner’s permit holder can be added to another policy -The best thing to do when you only have your learner’s permit is to just be added to another licensed driver’s policy. If you live at home you can be added to your parents’ policy. If you do not live at home you can usually be added to your spouse’s or roommate’s policy.

If you are just added to someone else’s policy there is usually no extra charge, which will save you a lot of money. It will also save a lot of problems and hassle.

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Should I purchase additional insurance?

This is a question that’s difficult to answer because there’s so much conflicting information. There are a fair number of insurance articles found online that suggest it is possible to purchase additional insurance coverage for learner’s permit drivers.

At the same time, it’s difficult to determine the difference between specific coverage for learner’s permit drivers and coverage that applies to such drivers through the policies of car owners.

Teens are usually covered automatically under their parents’ insurance, while an adult driver with a learner’s permit should be covered by the insurance on any car they drive, provided the owner is present and gives consent.

Having extra coverage is likely unnecessary because the standard auto insurance of the car owner covers the learner’s permit driver.

Restrictions on Drivers With Learner’s Permit

Young man driving a convertible car.

State laws dictate what learner’s permit holders can and cannot do. It’s important to know what the restrictions are in your state so that the actions of learner’s permit drivers do not have an adverse effect on your insurance.

For example, in the state of Georgia, a student may not retain his learner’s permit under the age of 18 if he does not remain in school. Therefore, a 17-year-old high school dropout could no longer possess a learner’s permit and would not be covered by insurance should he drive anyway.

Using the above example, if that 17-year-old high school dropout was pulled over, both he and his licensed passenger would be held accountable. If he were using his parent’s vehicle, it would reflect negatively on them and their insurance rates would most likely go up.

As long as student drivers are obeying the law, insurance rates will remain unaffected.

Drivers with learner’s permits can rest assured they don’t need to spend the money on their own insurance policies, but they do need to be careful to follow the rules that come with having a learner’s permit so as not to jeopardize passengers.

If you’re a parent with a child who possesses a learner’s permit, legally you may not need to inform your insurance company, but it would be wise to do so anyway.

As soon as they earn their regular license you will have to inform the insurance company, otherwise, your child may not be covered in the event of an accident.

Informing the Insurance Company Once a Valid Driver’s Licence is Obtained

Once you pass your driver’s test and get your license, you will need to inform the insurance company that you are now an official driver.

You can still stay covered under the driver’s insurance that you did when you had your permit, but now the insurance rates will increase because new drivers are considered to be a higher risk.

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