"We call it insurance sticker shock," says Robert Bland, chief executive of Insure.com, a subsidiary of QUOTESMITH.COM in Darien, Ill.

        For a hypothetical Beverly Hills, Calif., couple with a spotless driving record, their six-month premium on a 2003 Honda Accord jumps 355% -- from $582 to $2,653 -- when they add their 16-year-old son to the policy, according to Esurance, the online auto-insurance firm (a San Francisco-based subsidiary of White Mountains Insurance Group).

        Insurers say female drivers pose less risk, so adding a 16-year-old daughter instead leads to a 349% hike, or a six-month premium of $2,611. If that couple buys their daughter her own car, a 1995 Volvo 850 Wagon for instance, their premium rises to $3,189. Adding that car for a son brings premiums to $3,399 for the six-month period, according to Esurance,

        Adjust insurance coverage and locale, and you'll see different prices, but often a similar rate jump. For instance, the six-month premium on a 2000 Honda Accord DX for a careful-driving couple in Schaumburg, Ill., rises 314% to $1,529 from $369 when an 18-year-old driver shares the car, according to Progressive, the auto-insurance firm in Mayfield Village, Ohio.

(Rates vary widely depending on the level of insurance coverage and other factors. Some policyholders might escape with a relatively low 100% premium increase.)

        The higher rates have some justification: Drivers age 15 to 20 were 14% of the 58,156 drivers involved in fatal crashes in 2003 and 18% of drivers in 11.2 million police-reported crashes that year, though young drivers comprised less than 7% of licensed drivers (in 2002), according to the National Highway Traffic Safety Administration.

        The toll is more than monetary: Car accidents are the leading cause of death among those 15 to 20, according to 2002 figures from the National Center for Health Statistics, the most recent data available.

Shop for best discounts

        Before your teen grabs the car keys, get a quote from your insurer and others. Whether you switch or stay with your current carrier, put the teen on your policy to get a multicar discount. Plus, ask about other discounts.
State Farm offers as much as 15% off to young drivers who successfully complete the company's "Steer Clear" computer tutorial and Allstate does the same with a program called "Teen Smart."

        Progressive offers a 25% discount to minor drivers added to their parent's policy if the parent's policy is at least 24 months old, while Esurance gives price breaks every six months for drivers with clean driving records, including young drivers.

        Some parents link their teen's driving privileges to good grades: Students with a "B" average or higher may get up to 25% off their insurance rates.

Reduced use

        Consider reducing your rates by limiting your teen's driving. "If you buy your 16-year-old daughter that car for her birthday, she becomes a primary operator," Bland said. "A teenager as a primary operator is big bucks."

        Adding an occasional operator will cost less. The measure of "occasional" varies by insurer. At State Farm, an occasional driver contributes less than 25% of the car's mileage. "You want to disclose how and when your children use your cars. If it's really infrequent, stress that case," Bland says.

        Don't avoid telling your insurer that your teen drives the car: One accident means you face much bigger costs if the insurer suspects fraud.

        Some carriers offer "occasional driver" discounts to college students who drive the family car when they return home. Progressive's is 10%. The student must live at a school more than 100 miles away from the parent's residence.

        Another cost-saving strategy: Encourage your teen to drive carefully. A hypothetical 16-year-old boy in Mesa, Ariz., with a blemish-free record, eligible for all the discounts, pays $2,520 for a six-month premium, according to a sample quote from State Farm. That jumps to $2,752 after just one ticket, and $3,963 after a ticket and an accident.

        "We tell parents: Don't assume your teen drives with their friends like they do when they're driving with you," says Carole Walker, executive director of the Rocky Mountain Insurance Information Association, a nonprofit insurance trade group. "With their peers, they're less likely to wear a seatbelt, more likely to speed," she says. "What begins to happen very quickly for teenagers is they get one ticket, two tickets, it has a cumulative effect. They can see their insurance rates double, triple, quadruple very quickly."

Consider the car

        Before buying a car for your teen, call your insurer for a rate quote on the make and model. While an older car may be cheaper to insure than a newer one, there are discounts for some safety features on newer cars.

        Meanwhile, cars that don't hold up well in accidents, those that tend to result in more passenger injuries or are on thieves' must-have list will be more expensive to insure.

        But it's difficult to assess how all of these factors contribute to the rate. Your best bet is comparing rates on a specific car. For an idea of how one insurer rates cars, go to this State Farm page and click on "which vehicles get the lowest rates." http://www.statefarm.com/insuranc/auto/newteen.htm

Also, see the Insurance Information Institute's page on teen auto insurance. http://www.iii.org/individuals/auto/b/teengage/