The High Cost Of Teenage Terrors

Protect yourself and your children with good parenting and the right insurance

Car crashes, vandalism, date rape: Dark impulses can be released when teenagers mess with alcohol, drugs, and sex. The aftermath can wipe out a family's financial resources. This is why parents of teens need to put together an adolescent risk management program.

The best protection combines financial safeguards with a hefty dose of good parenting and acceptance of the possibility that even the best kids can get into trouble. "Parents just do not want to believe that their children are involved in alcohol or drugs," says David McCarthy, chief of the Greenfield (Mass.) police department. But they often are--and your home is the first danger zone.

Consider the travails of Arthur and Sheila Reyer of Merrick, N.Y. Unknown to them, their 17-year-old daughter, Heidi, hosted a fraternity party in their house while they were away. A boy punched a girl in the face, breaking several bones, and a nine-year legal battle ensued. The Reyers' homeowner's insurer, State Farm Insurance, paid the $90,000 in damages after an appellate judge found Heidi responsible--even though she threw no punches.

UMBRELLAS. Look at your homeowner's policy. Does it cover personal liability in addition to property damage? Normally you want $300,000 to $500,000 of personal liability, which will also cover legal expenses. If you have more than one home, or if you have a boat, you might want an umbrella, or excess, policy that shields you more. Umbrellas are relatively inexpensive, starting at $200 per year for $1 million in coverage. The most common are written for $1 million to $5 million. But some insurers, such as American International Group and Chubb, provide policies of up to $25 million, which are usually tailored for high-profile people. But check for exclusions. For example, an umbrella won't cover additional damages caused by your child's use of a boat if the primary policy excludes it.

Some parents think they can maintain control by hosting prom night or graduation parties where they provide the alcohol. But if a guest at the party is involved in a car crash, the parents can be staggered by lawsuits. The liability lies with whoever controls the liquor, warns Ronald Beitman, a Massachusetts lawyer and author of Liquor Liability: A Primer for Winning Your Case (American Law Institute/American Bar Assn., 1999; $129.50). "Courts that have adopted social host liability laws have been comfortable expanding liability to parents," he says.

Worse, giving alcohol to minors is against the law in all but six states, so parents could be on the hook for more than money. In Medina, Ohio, last year, David and Anna Jurgens were arrested for throwing a party where the smell of marijuana filled the air and the liquor flowed. Two school buses carted their 16-year-old son's friends to the police station. Convicted of furnishing alcohol to minors, David served 30 days in jail and Anna 60 days, and each paid a $250 fine. In another case that's still ongoing, two parents in tony Pound Ridge, N.Y., are charged with endangering the welfare of a child by permitting a party with underage drinkers.

Even without alcohol, cars and teens are an explosive mix. In a recent study by Liberty Mutual Group, 77% of the teens surveyed said they frequently speed, and 39% admitted they don't wear seat belts much of the time. According to two other studies, one by Johns Hopkins University and the other by the National Highway Traffic Safety Administration, having just one teen passenger in the car increases the risk of a fatal accident by an astounding 25% to 30%.

RAISING HELL. Protect your child by instituting the graduated driver licensing recommended by the U.S. Transportation Dept., even if your state is not one of the 43 where it's required in some form. Typically, stage one allows teens to drive only in the daytime with an adult. If they don't have any accidents or get any tickets for six months, they can move to stage two. Then the teenager can drive alone in the daytime, but must still be accompanied by an adult at night. The teen reaches stage three once he or she has successfully completed two years at stage two, turned 18, and avoided tickets and crashes.

But it's up to the parents to enforce the driving restrictions. Moreover, if you own the car, you may be financially responsible for damages if the driver doesn't have sufficient insurance--and damages can easily exceed your auto insurance coverage. In New York State, the average tort award for an arm injury of any kind, for instance, is more than half a million dollars. So make sure your auto and umbrella insurance adequately cover personal liability, says Don Griffin, a director at the National Association of Independent Insurers. "Since the amount of money available through auto insurance policies is not enough," he warns, "the car owner is at risk of losing his home, cash, and stocks."

The dangers aren't limited to your vehicles and home. Unsupervised Senior Week vacations in CancPound n or hotel stays after the senior prom may be rites of passage, but there's no insurance for sexual misconduct. Date rape--forced sexual relations between acquaintances--obviously can have lasting effects on the victim. At the same time, the fiscal resources of the perpetrator's family can be destroyed by legal fees and civil and/or criminal judgments.

Daughters can be taught skills to avoid risky situations. But parents should also teach sons not to violate boundaries and give them guidance about just what constitutes sexual consent. "Boys may make the mistake of assuming that girls are under some kind of obligation to say no at least once or twice before they `give in,"' says Carleton Kendrick, family therapist and adviser at

Plain old hell-raising can be costly, too, as the parents of nine teenagers in West Windsor, N.J., recently discovered. They'll probably have to shell out more than $2,000 each as payment for a night of golf cart demolition derby at a local course last April. In this case, the kids apparently wanted to be caught. They took pictures of themselves next to the carts, then left the camera and film at the scene of the crime. "The nice part," says West Windsor police captain Joseph Pica, "was when we went to the parents and said their kids were involved. After they saw the photos, they couldn't deny it." And facing reality is the cornerstone of every good teen risk management program.

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