Sometimes parents may be shocked at the high cost of young driver’s insurance. They can lower the cost of their child’s car insurance by buying a named driver policy.
This method of using the same vehicle less often than their children is legal, provided the parent is registered as the primary driver.
MoneySupermaket.com research shows that around 14% of parents claim to be the primary driver for a shared-car insurance policy. This is when their child uses the car more than they do.
This is known as fronting and it is illegal.
Surprisingly, 15% may be open to fronting in order to lower their car insurance, and 13% stated that they would cover their vehicle.
Research also revealed that some drivers were confused about the legality of fronting. Around 25% believed it was lawful, while a third did not know.
Peter Harrison, from MoneySupermarket.com, said ignorance may be bliss for motorists who thought fronting was a legitimate way to reduce the cost of motoring.
He stated, “In fact it’s quite different…fronting on car insurance policies is illegal, and it is worrying to see how many motorists are willing take this risk.”
“Despite the obvious appeal of car insurance policies that reduce costs, you will face serious consequences if your main driver is falsely claimed to be.”
Fronting can be considered insurance fraud and could result in the cancellation of the policy. For driving without adequate vehicle coverage, the younger driver could also be charged.
It will be much more difficult to get insurance coverage for someone who has been convicted of insurance fraud.
Young drivers’ car insurance can be expensive. However, there are legal and better ways to lower the cost.
Insurance for young drivers is typically more expensive than other policies, as insurers often consider motorists between 17-24 years old to be a high-risk group.
Unfortunately, statistics do not favor this age group. The Association of British Insurers (ABI) reports that around 20% of young drivers have been in a traffic accident. Meanwhile, 18 young motorists and their passengers are killed or seriously injured every day on the roads.
Car insurance premiums for teenagers and young adults aged 17-20 years are on average PS2,590 per year due to increased accident risk. Many young drivers may be discouraged from driving by the high cost of insurance.
Telematics may be an option for drivers who are looking for lower vehicle coverage.
The insurer will attach a small device, sometimes called a black box or clear box, to a customer’s vehicle when they purchase telematics auto insurance. This gadget can monitor policy holders driving habits once activated.
This may seem intrusive, but if a driver drives safely and responsibly, their car policy premium could be lower when they renew.
Telematics policy holders have usually access to this information, which is used to determine the policy’s price. Insurers may offer tips, hints and advice to their customers in order to make them safer drivers.
Telematics insurance might not be the right choice for someone who drives frequently and is dangerous. Instead of helping to lower their premium, it may increase their risk.
Parents should never allow their children to cover their vehicles with frontal coverage.
Telematics can help reduce car insurance costs and may even make it more affordable for younger drivers.
In the unlikely event that the worst happens and the policy holder is involved with a traffic accident, the telematics box acts as a GPS device, and emergency services can be notified about the vehicle’s location if needed.