When purchasing car insurance for your teenager, one question that will always be asked is: if the parent or guardian can own the automobile that the insured teenager is driving. In most cases, the answer is yes, any parent can own the vehicle you wish to insure. However, there are conditions to this rule. The parent or guardian should live at the same address as the teenager, and must not already have the car insured in their own name. Many of insurance carriers often accept that some younger drivers will have vehicles owned and registered by their parents and not have vehicles of their own.
This rule, however threads a fine line between naming a vehicle under a parent and the illegal action coined ‘fronting’. If the vehicle is insured in a parent or guardian’s name to contract a cheaper premium from the insurance company but the teenager will be the main user of the vehicle, this is called fronting. Aside from being illegal, this action should be avoided because a claim could be made invalid or void if caught fronting. This means that the insured carrier would not receive a payout and he or she could potentially be convicted of driving a vehicle without car insurance.
Not only could this permanently show on the young driver’s personal record, the teenager could serve a severe minimum fine and 6 points is generally the basic penalty. For young drivers or new drivers, this could often mean the immediate loss of their license. A vehicle named under a parent or guardian that is being used for commuting by a student their campus could be used as evidence by an insurance company to invalidate the policy because of fronting. In most cases, the location or the distance between the car and the registered owner is looked at. If the car is owned by a parent that lives miles and miles away, this immediately arouses suspicion.
To avoid this controversial action, the safest route of action is to insure the car or vehicle in the young driver’s name. Placing the name of the car under the driver’s parent or guardian is within the limits of the law, but it makes both parties vulnerable for investigation and it places both parties under suspicion of the company. Insuring the car in the young driver’s name poses the least risk for all parties involved and erases all motives for suspicion.
