Can I Be on My Parents’ Car Insurance?

As you grow up and hit driving age, it can be natural to assume that you would be covered on your parent’s car insurance. Don’t assume this, though. Just because you live with your parents, it doesn’t mean the insurance company will cover you automatically.

Your parents have to add you to their car insurance before you can drive under their insurance. This typically means higher premiums as a result of adding a ‘high risk’ driver to the insurance. Keep reading to learn how it works.

Permit Drivers

When you first get your permit, you are ‘provisionally licensed’ to drive a car. You don’t have your full license and you can’t be out on the road without a parent or licensed adult driver. In this case, your parents don’t need to add you to their insurance yet.

This does vary by state, though, so check with your insurance agent to find out your state’s laws. Typically, insurance companies cover permit drivers. They do so because it protects the parents that are trying to teach the children to drive. In addition, most teens can’t get insurance anywhere else since they don’t have their license yet.

Licensed Drivers

Once you have your license, it’s time for your parents to add you to their policy. They must call the insurance agent and list you as a driver. This changes the dynamic of their insurance, though. Adding a younger driver means adding a ‘risky driver’ to the insurance.

Just because you live at home with your parents doesn’t mean you can automatically drive their cars. The insurance company must determine the riskiness you add to the insurance policy. They will change the premiums accordingly. Oftentimes insurance rates double when adding a teenager to the policy.

It’s important to know that even if you get your own car and own insurance policy (which we don’t recommend), your parents must list you as a driver. As long as you can provide proof of your own insurance, this won’t change your parents’ premiums. Yet, if they don’t disclose that there’s another driver in the house, the insurance company could consider it fraud.

If your parents don’t add you to their insurance and you drive their car, the insurance company won’t cover you. If you were involved in a car accident, the liability would fall on your parents’ shoulders, not that of the insurance company.

Licensed Drivers Away at College

It’s still important to remain on your parents’ policy even when you leave to go to school. There’s still the risk of you driving a car and getting into an accident. Luckily, if your parents record you as a ‘student away at school’, they’ll get a much lower rate while still offering you insurance. Typically, you must go to school at least 100 miles away for this to be the case, though.

Licensed Drivers That Move Out

If you move away from your parents (not to college), you should get your own insurance policy. While the insurance company probably won’t kick you off the policy immediately, you should start looking right away. As soon as you aren’t a true dependent of your parents any longer, insurance companies want you on your own car insurance policy.

As long as you live at home and your parents list you as an active driver on their insurance, you could be on your parent’s insurance. Once you move out, though, or if your parents don’t list you, the insurance company won’t cover you even if you drive your parents’ car. The insurance company insures the car, but only for listed drivers that reside with the owner of the car. You have to be honest with the insurance company in order for them to provide the coverage that you need.