When Should You Add Someone to Your Auto Insurance?
If someone has access to your car, holds a driver’s license, and lives at your residence, it’s essential to add them to your car insurance policy. This includes teenage and young adult children, domestic partners, and spouses. Even children who live away at college but drive your vehicle when they return home should be added to your policy, as stated by cover.com.
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According to wallet hub, it’s best to add your children to your car insurance as soon as they become new drivers. However, the specific timing may vary by state. For instance, Maryland, Indiana, and Illinois allow insurance companies to require coverage for drivers with a learner’s permit, whereas in other states, insurers cannot charge until your teen has a full license.
If someone occasionally uses your car for work but doesn’t live with you, you may need to include them in your auto insurance policy. This applies to occupations like home health care workers, homemakers, and child care workers. Check with your insurer to understand their rules for these situations. Adding these individuals to your policy helps protect their financial interests, but you can remove them if your employment arrangement ends. However, this exception does not apply to a babysitter who only works for you occasionally.
It’s also important to consult with your insurance company regarding adding people who aren’t close friends or family members living with you, such as roommates or guests. Consider whether your roommate ever borrows your car. If they have an accident that isn’t covered by your policy, the insurer may not provide compensation, according to penguin value.
When Can You Exclude Someone from Your Auto Insurance Policy?
Individuals who occasionally drive your vehicle but don’t reside with you don’t need to be included in your auto insurance coverage. Most insurance companies have a “permissive user” clause, meaning you can lend your car to someone else on occasion while maintaining coverage. This clause applies to guests or relatives visiting from other locations, for example.
If you live with roommates who own their vehicles and have their own auto insurance, there’s no need to list them on your policy. This applies even when you occasionally swap cars.
If you share a vehicle with someone but don’t live together, obtaining a joint auto insurance policy may be challenging. If you find yourself in this situation, it’s best to speak with an insurance agent for guidance.
Suppose you want to completely restrict someone’s access to your vehicle, and they live with you. In that case, you can ask your insurance company to list that person as an excluded driver. By doing this, you may be able to avoid a rate increase if the individual has a history of accidents, tickets, and claims.
How Can You Add Someone to Your Auto Insurance Policy?
Most major auto insurance providers offer various methods for adding another person to your policy. You can typically do this online, through the company’s app, or by calling your agent or provider directly. To expedite the process, gather the following additional driver information:
- Legal name
- Date of birth
- Social security number
- Years of driving experience
- Driving history
- Vehicle make, model, and year (if applicable)
The Cost of Adding a Driver to Your Car Insurance
Contrary to what you might think, adding another driver to your policy doesn’t always result in higher costs. According to Allstate, you can often save money on coverage by adding an older, experienced driver to your policy.
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When comparing average insurance rates for a 2014 Hyundai Sonata, wallethub found that adding a 16-, 30-, or 50-year-old driver to the policy had varying effects on the rates. For example, a 30-year-old driver would pay an average of $817 for a six-month policy alone, while the cost would increase to $2,001 when adding a teen driver, $924 for adding a driver of a similar age, and $1,003 for adding a 50-year-old driver. A 21-year-old driver would pay $1,436 for six months alone, $2,303 for a joint policy with a teen, $1,309 for a joint policy with a 30-year-old, and $1,268 for an additional 50-year-old policyholder.
However, these averages vary significantly based on the drivers involved. Adding safe drivers can help high-risk drivers save on premiums, while safe drivers who add less cautious drivers to their policies may see increased costs due to higher associated risk. Teen drivers are generally considered high risk by most insurance companies until they reach the age of 25. While young drivers can benefit from being included on their parents’ policies, parents may experience rate increases.
According to research from wallet hub, families with a teen driver pay an average of an extra $225 per month for auto insurance. Even if you exclude your teenager from your policy, the insurance company will likely discover that there’s an uninsured driver at your address by checking state department of motor vehicle records. In such cases, the insurer may choose to discontinue your policy or collect premiums from the date your teen obtains their license.
If your child has an accident without insurance coverage and is under 18 years old, you will be solely responsible for the costs. If you don’t want your premiums to increase, you may want to consider having your teen purchase their own auto policy.
Whether you need additional information, resources, or guidance on auto insurance, be sure to check out credible sources.