For parents with young adult children - college students for example - it can be tempting to leave them on your policy while they’re away from home. While this may be passable for some, it really is frowned upon in the car insurance industry. Most providers want to know where that car will be parked every night, and if it’s in another state instead of at your home, you can run the risk of increased rates or terminated policies.
There are other, more legitimate ways to save on your “young adult” driver. Here’s how you can get cheap car insurance from a child not living at home. In this article, Part 1 advises you to take advantage of young driver discounts, Part 2 suggests putting the car in the name of the child, and Part 3 explains how putting a second car in their name can earn a multi-car discount.
Part 1 of 3: Take advantage of student and young driver discounts
Because car insurance rates for younger drivers are statistically the highest among the demographics, you need to take advantage of as many discounts as possible for your young driver. If they’re in college for example, there are numerous reputable car insurance providers that offer student discounts - some of which can knock 25% off standard rates.
Other discounts may be available, such as safe driver courses that are enrollable and offer extra savings upon completion. Call your insurance provider and ask how many discounts are available for your child and then make sure they take advantage of each.
Part 2 of 3: Make sure the car is in the name of the driver
If your child leaves with a hand-me-down, and goes to buy their own policy, you’re going to want to put the title of that car in their name, or at the very least allow them to be a co-owner. This gives them an insurable interest in the car, which insurance providers will look for when working up a new policy.
Part 3 of 3: Give the young driver the “second car”
This example requires specific circumstances, but if you can swing this, you can also help your child save money. Say for example they have their own car at their own residence, but you have multiple cars. Signing one car over to them and then moving it to their residence can allow them to tap into a multi-car discount.
While it may seem nice to keep your child under your policy after they move out, it’s highly recommended that you don’t. However, you don’t want them to spend all their money on car insurance, so keep your eyes peeled for discounts that can help them save with their own policy.