Your son or daughter has graduated college and is ready to start his or her adult life. Is now a good time to take them off your car insurance?
It’s a decision that many parents tend to put off. Unlike health insurance, there is no maximum age for children on a vehicle policy. As long as they live with you, and drive a car you own, they could remain on your policy indefinitely. However, you may also choose to remove them, and that’s the case even if they do live with you. Here are some reasons why you might consider it.
- It will likely save you money. It is more costly to insure younger, less experienced drivers and so removing them from your policy will likely lower your premium.
- It will teach your child responsibility. Car insurance premiums are usually among the first bills that a young person is responsible for paying.
- It can improve their credit score. Paying the premiums on time will help build your child’s credit score.
- You both may qualify for a multi-vehicle household bundles or discounts.
- In some cases, children move to a new address and don’t update their auto insurance right away. Getting your child his or her own policy will ensure that there is no gap in coverage when they move out.
When you need to remove your child
If you’re thinking about removing your child from your auto policy, read on. We’ve compiled a list of situations when it is recommended that young adults have their own policy.
Your son or daughter no longer lives with you.
- Your policy is tied to your home address. If your child has moved away, they can’t be on your policy.
- If, however, your son and daughter is simply living at college, their home address is likely still yours. That allows them to remain on your policy, with some modifications.
- If the college is enough of a distance away, and they are not driving, their insurance may be temporarily paused.
- If they take their car to college, the new location will be incorporated in the premium quote.
Your son or daughter is covered under another auto policy.
- The car that your child drives can only go on one policy. If your son or daughter is covered under another policy, such as in cases of separation or divorce, you do not need to pay for a second policy.
- If your son or daughter lives mostly at one location, your teen may be listed on the policy at that home.
- If your son or daughter regularly parks his or her car at both parents’ homes, your child will still be covered at both locations under one policy.
Your child has bought his/her own car.
- Insurance companies generally require that any vehicles on your policy be in the primary policyholder’s name.
- If your child buys his/her own car, the insurer may require a separate policy.
- If you do not get a separate policy, then you remain the primary policyholder. If your child gets into an accident with his/her car, and the claim is covered, the check will be written to you.
How to remove your child from your policy
1. Contact your insurer. Ask to have your child removed from the policy.
Insurance companies usually require you to list all household members of driving age when you apply for, or renew, your policy. If your child gets his or her own policy, and still lives at home, you will need to exclude them from your coverage. That means they won’t be covered in an accident even if they had an occasional use with permission. Note that you may be charged a fee or excluding a driver that lives in your household.
2. Provide proof of other insurance.
When you remove your child from your policy, your insurer will require proof that your child has his/her own policy. You can choose to get a new policy with your current insurer and maybe take advantage of household discounts. You also could change insurance companies. Make sure to set up the timing so that one policy kicks in when the other one lapses.
3. Provide proof of new address.
If your child has moved to a new address, your insurer may ask for proof of residence. This may include a utility bill or other authorized mail.
Talk to your insurer about options so that you can find the best fit for your family, and also meet state and insurance requirements.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.