Have you ever wondered, “when should my kid get their own car insurance?” We’re asked this question often so we’ve provided a few of the common situations where you might decide it’s time for your child to get their own policy. Of course, this varies family to family, so we advise you to talk to your insurance agent and they will help you decide the best time to remove your child from your policy.
Please note: There is no certain age at which a child must be taken off your car insurance policy, as long as he/she is living at home. As long as your child lives under your roof and drives your cars, you can – and should – list them on your policy.
When your child is a minor, you are liable for their actions. But when they reach adulthood, you can decide if you want to keep that responsibility or eliminate that liability. However, if your child is still financially dependent, you will want them to remain on your policy.
If your child has too many speeding tickets or accidents on your policy, it will have a negative impact on your insurance premium. When your child is removed from your policy and on their own, it protects your rates from their mistakes.
The registered owner of the vehicle largely determines whether or not your child qualifies to be in your policy. If the car is registered to your child, he/she will need to get their own policy. If the car stays registered in your name (or is co-titled), you have an insurable interest in the vehicle and may keep the car on your policy. Car insurance policies are designed to follow the vehicle, so whoever is the titled owner needs to insure the car.
Having bills in your child’s name not only encourages financial responsibility, but it also helps build credit history. Lack of credit history can be a hindrance to young adults when purchasing a vehicle or applying for a home loan. So the earlier they can start building credit, the better.
When your child moves away from home and into his new apartment, now is the time to get his own car insurance policy – and a renters policy! He’ll get a multi-policy discount and his belongings will be covered. However, the situation is a bit different if your kid is going off to college. Even if your student is not taking a car to college, you should keep them on your policy. Many insurance companies have a discounted rate for students who are away at school and at least 100 miles from home. When they come home from school on breaks, they will still need car insurance coverage.
In many cases, it’s fine to keep your children on your policy. However, we recommend you discuss your specific situation with your agent in order to guarantee that your children still qualify to be on the policy.