By offering a discount to young drivers graduating from a reputable driver education program:

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By offering a discount to young drivers graduating from a reputable driver education program, insurance companies are signalling that these drivers are less risky to insure. This creates a signalling equilibrium where young drivers are incentivized to take driver education programs and insurance companies are able to differentiate between low-risk and high-risk drivers. However, this does not eliminate discrimination among drivers or collude with driving schools, nor does it erase the difference between low-risk and high-risk drivers.

By Offering a Discount to Young Drivers Graduating from a Reputable