Children are great, but with all the joy they bring comes a large, heaping helping of worry. Big worries, small worries. Most work themselves out with a little bit of knowledge and effort. But one thing is certain: they just keep coming. One small worry that you are bound to run into when your child reaches driving age is the matter of auto insurance coverage. Suddenly, the questions start rolling around in your brain. Is my child automatically covered as a driver under my insurance? If not, when should I add him or her to the policy? What happens if he or she gets into an accident in the meantime?
Starting to worry? Well, don’t because this is where a bit of knowledge comes in to save the day. One caveat before we get started, though. As with everything involving auto insurance (and children), things can get a little complicated. The information provided here is general in nature and it is important that you check both your state’s regulations and the specific language of your policy for any variations.
Learning to drive.
In most cases, a child with a learning permit does not have to be added to your policy. They will be automatically covered during the learner’s permit period. But you should always contact your insurer once the learner’s permit has been issued. There are several reasons for this. First, a few insurance carriers do require that you add your learning driver to your policy. Second, you need to know what specific rules must be followed by your teen while driving with a learner’s permit, such as whether or not a parent must be in the car at all times, or whether there are time-of-day restrictions. If your child is in an accident while driving under a learner’s permit, and the specific rules of your jurisdiction or policy were not being followed, you may have a big problem.
Getting that license.
Once your child has passed the driver’s exam and road test, and has that coveted full license in hand, you are going to have to bite the bullet and add them to your policy. This will, of course, mean an increase in your premium. But if your child is living under your roof and you intend the let them drive your car, you have no choice. There is one alternative, actually, and that is to have your child obtain their own separate policy. This will most likely require that he or she (or you) purchase their own vehicle, though, and the total cost of both policies will probably be higher than if you simply add them to your current one. One other thing. If your child heads off to college, you should be able to keep them on your policy as long as your home remains their permanent address.
You are bound to experience a little “sticker shock” when you find out how much more you will be paying on your premium by adding your child. You may even feel the urge to simply not tell your insurance company. Fight that urge. If your child has an accident and your insurer discovers you’ve been holding out, your damage claim will likely be rejected and your policy cancelled.
Out of the nest. Completely.
Once your son or daughter is done with college and has moved into their own place, it’s time to take them off of your auto insurance. More specifically, if they can no longer legitimately claim your home as their permanent address, they should no longer be named on your policy. Don’t fret, however. You may be sad to see them fly the nest, but you can console yourself with the money you’ll be saving on your monthly premium. And your child will still be covered under the “permissive use” clause of your policy when they come over to visit and borrow your car for a quick trip to the market.
Don’t forget that laws and policies vary, so if you have any questions about who are what is covered under your policy, contact your agent right away. This is one of those times you should let your insurance agent guide you to do what is best to protect both your family and your finances.