You may be wondering which path is best for you when it comes insurance. One of the many questions that you may have is whether you can keep your parent’s insurance. It depends.
While there are situations where staying on your parents’ policy is a good idea, there are also times when it makes more sense for you to purchase your own insurance. It is important to know when it makes sense to keep your parents’ auto insurance policy and when to go out on your own to get the best coverage for you.
How You Can Get Auto Insurance from Your Parents
You can be on the auto insurance policy of your parents in many ways. This arrangement is great for young drivers as it allows you to get lower insurance rates than if you had your own policy. It’s important to understand when you can stay on your parents’ policy and when you cannot.
Your parent may co-own the vehicle.
Most insurance companies will allow you to remain on your parent’s policy if you and your parent own the vehicle.
You live with your parents and the car is theirs
If you are living at home with your parents and your parents own your car, you can keep your policy. If you are married and live at home, this applies as well.
As a college student, you can drive the car of your parents when you’re at home.
You can only drive your car while you’re at home with your family when you visit college. Insurance companies call this “permissive usage”.
You leave but live in a home that your parents rent or own, even though you are moving out
Even if you move out, you can still stay on the parent’s policy. However, you must move to a property that your parents rent or own.
If you are not allowed to be on your parent’s auto insurance,
However, you may need to get your own policy in certain circumstances, even if the driver is younger. Remember to tell the insurance company all the details about your driving habits and whereabouts. Otherwise, you could face denials or cancellations by the carrier.
You own your car
If the car is in your sole name, you will need to get your own insurance policy. You cannot stay on your parent’s policy. This applies regardless of whether you live at your parents’ home, are away from school for part of the day or do not live with them at any time.
If your parents own the car but you don’t live there,
It all depends on the insurance policy. Every insurance company defines dependent children differently. Your carrier’s definition of dependent child will determine if you are allowed to stay on the parent’s insurance policy, even if they don’t live with you. It is best to check with your carrier.
Financial independence is yours
This is more of an assessment and not a decision made by the insurance company. If you’re financially independent and are renting or buying your home, it might be a good idea to get your own insurance policy.
Should You Continue to Be on Your Parent’s Insurance Plan
You have many options to decide if you should remain on your parent’s plan. Cost is one of the most important factors in this decision. It will probably cost less to stay on your parent’s insurance than to go out on your own. Insurance premiums are higher for younger drivers because they are more likely to be involved in accidents.
Although the cost of your parents’ policy is lower, if you’re under 25, the insurance rates will rise. The rate of a policy will rise if a young driver is added. This is because younger drivers are more likely to engage in high-risk behavior while driving. The premiums for adding a teen driver can go up to 130%. Your parents will not have to bear the extra cost of having a younger driver on your policy if you get your own policy.
|There are pros to staying on the parents’ policy||Cons of staying on parents’ policy|
|Access to lower premiums||Parents can get up to 130% more on their policy premium|
|Additional discounts such as multi-driver or Good Student are available||Cost burden for parents|
Most Frequently Asked Questions
Which is the best auto insurance company?
There are many factors that go into choosing the right car insurance company for your family. You should consider your budget, coverage options, and customer service. Digital assets and customer service are also important. reviewed several carriers and ranked State Farm highest with a 3.93 rating out of 5.. This was based on financial strength and customer satisfaction ratings, as well as competitive premiums.
What length of time can I remain on auto insurance for my parents?
The age limit for how long you can remain on an auto policy of your parents is not a problem. You can continue as long as you meet all the requirements for insurance carriers. As you reach milestones such as getting married or working towards financial independence it is important to consider when the best time to change to your policy.
Are car insurance rates really lower for those who are 25-years-old?
If your driving record does not include traffic violations or accidents, your insurance premiums can be reduced at 25. Insurance companies will consider you an older driver at this age and less likely to speed.
How can I lower my teenager’s car insurance?
There are many ways to reduce your insurance costs, even if you’re a teenager driver. You should take advantage of all discounts. Multi-driver discounts, bundling and good student discounts are all available. Comparing multiple carriers can help you find the best rate for your premiums, especially if you have a teen driver.