People naturally worry about rate increases when they need to include one more person to an auto policy. Most people are under the impression that premiums would always go up after adding a driver to insurance. Although this may be the case most of the time, it is certainly not always. So, let’s have a look at different circumstances and see their influence over prices.
When an Additional Driver Reduces Auto Insurance Cost?
Premiums can go down if the person is older than you, have better record and more experience. It is actually more beneficial that the car is covered under the older and better driver’s name. This may be possible and acceptable providing such person is likely to use it as much as you. This choice is more apparent between couples.
Many young people manage to get lower rates by finding an older person to buy a policy for them, usually parents. You need to be careful with this strategy. You may be committing a fraud if you are the main user but someone else is fronting for you by purchasing it on his or her name, even though they will only get behind the steering wheel occasionally.
It is clear that whole purpose of this exercise is to avoid paying a fair premium for the risks. Although you may call it expensive it is actually fair that a teenager pays a lot more than an established person for obvious reasons.
On the other hand, it is all right to add an older driver onto a car insurance policy owned by a youngster. And this strategy would save some money in most cases. They don’t even need to be living with you or related to you. This may still be a grey area but fronting is certainly the dark side.
Adding a Young or New Driver to Automobile Insurance
This can sometimes double the premium especially with a riskier car. That is why some people who were enjoying great rates may be very surprised when they want to cover their teenage daughter or son as well. It may be necessary to switch companies to get back to affordable prices again because each of them has a different appetite for risks.
Adding a Spouse on Vehicle Insurance
Including another person with a similar record onto an auto policy shouldn’t increase the premium much since the risks aren’t really heightened with the new driver. One of the most common reasons for this is marriage or moving in together. Auto insurers are known to offer special discounts for couples. You should quickly get a few instant quotes online if the current company doesn’t offer a good deal or actually hikes the rates once you tell them about the new person in your life. There is no reason for souring prices because only one of you can use the vehicle at a time.
Who Should Be Added on Car Insurance as Listed Driver?
It is not an option to inform the existence of a person with a license living with you in the same house. Companies would want to know about them anyway and they would have asked the relevant questions. The cost concerns come second here when the policy terms dictate that you let them know of any changes in your life. If someone has moved in with you or vice versa you are required to inform the carrier or agent.
Generally, a policyholder’s son or daughter passes license test or a partner moves in. These are the situations that concern carriers and you need to be open about them. You may have a choice to include someone who has access to your car but not living with you. But you shouldn’t take liberties with these choices.
If someone regularly gets the keys to the automobile he or she should be listed on the policy. This is the safest option but may not be cheaper one. However, it will definitely protect you in case of claims regardless of who caused the accident or damages.
Often people see these arrangements from only cost angle but they have huge prospective benefits and you can only claim them if you comply with the terms of the contract. There is a chance you might not get found out. But what is the point of taking chances since the whole point of the exercise is to reduce the exposure.