It’s no secret that if you have a teen driver in the family, you can expect a hefty increase in your auto insurance rates – in most states, at least.

Nationwide, parents who add a teenage driver to their insurance policy can expect their premium to increase by a whopping 80 percent, according to a recent Quadrant Information Services study.

That is, unless you live in the Aloha State, where the average increase is only 17 percent, according to the study.

“The parents in Hawaii took the least hit,” says Michael Barry, vice president of media relations for the Insurance Information Institute.

 

Hawaii law makes teen car insurance cheap

Hawaii’s strict anti-discrimination law prohibits insurers from basing premiums on factors including, age, sex, race, ethnicity, driving experience or marital status.

Along with California and Massachusetts, “Hawaii is also one of three states that doesn’t allow insurers to use credit-based insurance scores,” Barry says.

The state takes the anti-discrimination law seriously. In 2002, seven of the state’s largest insurance companies agreed to pay fines totaling $115,000 and remove illegal criteria that had been used to set premiums.

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“Hawaii has a clear law that prohibits auto insurers from using discriminatory criteria when determining the premiums motorists are charged,” then-Insurance Commissioner Wayne Metcalf said at the time. “Insurers cannot base any part of a person’s premium on account of their race, creed, ethnic extraction, age, sex, length of driving experience, credit bureau rating, marital status or physical handicap.”

While Hawaiian insurance regulations benefit residents of the state, they don’t necessarily bode change for parents in other parts of the United States.

“State legislatures and state insurance departments have influence over what insurers operate, the policies available and rating criteria,” Barry says.

Unless lawmakers push for big changes in insurance regulations, anti-discrimination laws aren’t likely to decrease premiums for teen drivers in other states.