Top 3 Reasons Why You Need a Personal Umbrella Insurance If You Have a Teenage Driver

Jul 25, 2022 | Personal Insurance

As parents continue to worry about their teens becoming drivers. Personal Umbrella Insurance in Denver, CO (or any other state in the US) might be a default add-on to their auto insurance policy.

You and your teen driver

Have kids, they say. It will be fantastic with kids around, they say. They were right… until the kids learn to drive and go off on their own… and then it is another story.  What is it with teenagers getting behind the steering wheel and you, as a parent or a guardian getting in financial trouble? If you are a parent with a teenage kid starting to drive independently, you better cover yourself with personal umbrella insurance. Otherwise, better be prepared to risk getting bankrupt. Unfortunately, this couldn’t be more true. 

Preparing your teenager for mobility

Now as a parent or a guardian, you would still like to prepare your kid for his independence via mobility. For you to do that, best to prepare yourself first. Otherwise, you wouldn’t be able to help your teenage kid much. The question is, how prepared are you? 

A Scenario with a Teenage Driver

It’s Friday night, and 17-year-old Tony Dowell is on a date with his high school crush Stacy. He picks her up from her house and agrees to see a movie together. Unfortunately, they were running late since Tony had to finish his shift from a part-time job after school. Tony decided to speed down a little along the highway. He didn’t see an oncoming car around the blind curb. He crashed directly into the car, and the impact made both vehicles swerve violently.

Tony suffered broken bones and had to be in therapy while recuperating. Stacy remained comatose for more than a month. The couple in the other car was not as fortunate. The husband passed away after a week, while the wife was left with a permanent disability. 

Tony’s parents, fortunately, decided to get a personal umbrella policy for the family long before this incident. This helped them cover all the medical expenses of Tony, Stacy, and the couple. 

Now the question is, are you as prepared as Tony’s parents?

Teenage drivers and vehicular accidents

The second leading cause of death for US teens in recent years involved motor vehicle accidents, based on a report published by the Centers for Disease Control and Prevention. Almost 2,500 teenagers aged 13-19 died, and around 285,000 had to be treated for serious injuries involving vehicular accidents in 2018 alone. Around seven teeners aged 13-19 were killed due to these accidents alone. 

The age group of 16-19 registered highest among all other age groups as they are three times most likely to suffer in a fatal crash. 

Teenagers at risk are further categorized into the following groups:


Immaturity, or the feeling of being invincible, has increased among many kids between 16 and 19. Popular film franchises like “The Fast and the Furious,” featuring street or drag racing, have started to take root in some neighborhoods. The idea of the “the faster, the better” cult is increasing and encourages teenage males to participate in these unsafe stunts.  

A teen driving with other teen passengers 

Another study showed that around 52% of vehicular deaths involving teens happened with another teenager at the wheel. An unsupervised teenage driver is most likely to get distracted by the presence of each individual teenager on board. 

A teen with a new driver’s license

The chance of a teenager figuring in a crash is most likely high within the first month of getting his license. Full throttle! You only live once! A driver’s license and their own car can sometimes give teens a false sense of security and put them at high risk by showing off. The National Household Travel Survey listed them as between the ages of 16, 18, and 19. 

Threats Faced by teenage drivers


Teens being young, are less likely to fear dying. This feeling of invincibility may push them to get reckless and uncaring. Further, this could also hinder their critical thinking, particularly when making decisions in a snap, which could put them in grave danger.

Weekends and nighttime driving

Driving in the dark during nighttime and with less traffic, especially on weekends, can put the driver in defensive mode. It may also put him in a pensive mood. According to the same study, about 37% of motor vehicle accidents that resulted in teenage driver and passenger deaths were recorded from Friday to Sunday between 9 pm and 6 pm. 

Non-observance of protocols


Around 43.1% of high school students in the US in 2019 do not wear seatbelts most of the time, especially if they are passengers. According to statistics in 2018, most of those killed in car crashes were not restrained with seatbelts.

Distracted Driving.

According to the 2019 National Youth Risk Behavior Survey, 39% of high school students who drive in the US have, at least once within the 30-day interval of the study, deliberately used their mobile phones for texting or sending emails, even while driving. This result further cements the reality that drivers, especially teenagers, still do other tasks even when they are driving despite knowing the possible repercussions. 


A teenager in a speeding car is a lethal combination. This devil-may-care attitude also excites them to speed up and go for shorter distances between their own car and the one in front of them (headway). In 2018, most teenage drivers who figured in fatal vehicular accidents were due to overspeeding. 30% of the males were 15-20 years old, and 18% of the female drivers were from the 15-20 age group. This is the highest percentage compared to other age groups per gender during that period.

Alcohol Use.

“Don’t drink and drive. Don’t drive and drink.” With sane and clear minds, as lives have been lost due to the toxicity of alcohol, lives can be saved. Needless to say, taking in any amount of alcohol before going behind the steering wheel increases the chance of getting into an accident – not just for older and experienced drivers, but more so for teenage drivers.

Drowsy, reckless, and impaired driving

While being drowsy is not necessarily a crime, it can put your passengers or other people coming along your path at risk. And that is where the problem can start. Driving while drowsy can be as dangerous as driving while drunk. It could be a result of sleepiness or fatigue. Dozing off while driving can effectively cause a fatal crash. 

Setting up your protection plan

It may be true that you have your own insurance coverage for your family. You may even have your life insurance, health, long-term disability, homeowners, and auto insurance. This could also be on top of the coverage included in your employee benefits package or, if you’re a business owner – your other policies for your business.  Since our immediate concern is your teenage driver, let us focus first on maximizing your coverage for your kid.

A teenage driver is equivalent to another car needing coverage, right?  Being one of the four insurance coverage, everyone should ensure he has the best understanding of the basics of Auto Insurance

Don’t be another statistic.

The National Highway Traffic Safety Administration reported that in the US alone, there were an estimated 6.7 million car accidents in 2018.  In 2019, an estimated 38,800 people were killed in car crashes.  According to the CDC data, auto accidents are the number one killer for Americans aged 5-24.  More than 2.7 million drivers and passengers were injured in 2018. Around $242 billion were lost due to auto accidents that resulted in deaths and injuries in 2010. 

Some states do not require drivers to have auto insurance, but most have rules on financial responsibilities in case of accidents.  For those that require it, such as the State of Colorado, fines can be stiff until you get coverage.   The first offense is a minimum $500 fine and license suspension until proof of coverage is presented to the Division of Motor Vehicles.  

The second offense is a minimum $1,000 fine and license suspension for four months. 

Third and subsequent offenses are a minimum $1,000 fine and license suspension for eight months.

To date, only New Hampshire and Virginia remained as the only states that do not require insurance coverage for car owners in the US. Vehicle owners may opt to post cash bonds in New Hampshire. An uninsured motor vehicle fee may be settled in Virginia.   In the long run, however, it is much more beneficial for car owners to get auto insurance – especially if they have an accident. The financial burden may be eased. The auto insurance will cover the expenses and protect you from litigation. It protects your vehicle from theft, vandalism, or natural disasters.   

But the next question is, given you have your teenage driver to consider now – is this going to be enough?

The Personal Umbrella Policy

Tony Dowell’s accident claimed the life of one of the victims, left their wife on permanent disability, his girlfriend comatose, and he himself in bad condition. Will his parents’ auto insurance coverage be enough to compensate for everything? Given the extent of the injuries and sufferings, everyone suffered, probably not. It’s a good thing his parents have the foresight to add a Personal Umbrella Insurance policy on top of their auto insurance, which gave them a lot of headroom. 

Regular liability insurance protects the insured from litigation due to injuries and damage to people and/or property. It is normally embedded within the auto, home, and renters insurance. Umbrella Insurance is a form of liability insurance. However, it covers a much higher limit beyond the embedded liability coverage of auto insurance. It goes above and beyond the claims relating directly to the standard (ex: auto or home) policy.

The Personal Umbrella Insurance Policy protects your assets from unanticipated events. An example is a tragic accident in which you or your teenage driver is held directly responsible for the damages or injuries. Further, the Umbrella Insurance will also cover the damages in litigation up to the policy limit. This additional coverage can protect you as the policyholder from false arrest, even libel, and slander. One thing it does not do, however, is protect damages to the policy owner’s own home, car, or possessions. 

Why should you have to consider getting umbrella insurance now?

Having a teenage driver in the household puts you, the parent, at a greater risk. After all, things being considered, here are the top three reasons why you should get umbrella insurance now:

Additional coverage.

An accident is just what it is – it can happen anytime, even to the most careful person. In general, teenagers tend to feel invincible. Whether you like it or not, you need to be prepared. Your current auto insurance liability policy may not be able to provide enough coverage when you need it the most.

Wider scope.

This supplemental coverage allows all licensed drivers in your household, including your inexperienced teenage driver, to be included in the policy.

Protection of your assets.

Litigation and recuperation after an accident can take time. Expenses may go beyond your auto insurance policy’s liability limit. The umbrella insurance can protect you by covering the excess beyond your standard policy’s limit.

The umbrella policy shields you from selling off your properties or cashing in some other policies to settle remaining claims from your own pockets.

The Bottomline

Indeed, it may cost you much more to get a Personal Umbrella Insurance policy— on top of your standard auto insurance policies. However, looking at it deeply, you can see that the benefits outweigh the cost. In the long run, it will be more beneficial to you. Remember, you are protecting yourself, your assets, and your teenage child, who is now behind the steering wheel of his car.

Call us today!

Please contact us for more information about Personal Umbrella Insurance and the like. We’ll be more than glad to assist you. 

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