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College Grads and Car Insurance
If you are the proud parent of a college graduate this spring, congratulations to you both. You probably feel like your child is an adult now, and in many ways you are right. But where car insurance is concerned, it is important to understand the limits of independence.
If you choose to keep your adult child on your car insurance, you most likely understand that you are exposing yourself to liability if your child causes injury to someone else in an accident. To avoid that exposure, many parents take their child off their policy and have the child buy his or her own insurance – often with much lower limits. If a child has been driving a car registered to the parents, the parents often transfer that registration to the child.
However, that might not be enough to ensure that you have no potential liability. If someone is injured by your child, the injured person – or his or her lawyer – may decide that the potential payday is bigger if they come after you, claiming that you have liability because the child is a member of your household. This is especially true if your child has only the minimum required liability limits.
In this case, the lawyer might ask:
There are valid reasons to keep your children on your car insurance, including the fact that the coverage probably costs less. However, if you want to guide your children to complete insurance independence, it is important to understand what you both have to do to achieve that.
- Does the child live at your home? If your child does not have his or her own residence, it can be very difficult to prove that he or she is not a member of your household.
- Even if the child has a separate residence, what is the address on his or her driver’s license? Often adult children leave their parent’s address as the address on their license, at least until they know they are going to be in the same place for several years. But if the address on your child’s driver’s license is still your address, that bolsters the case that the child is a member of your household.
- What is the address where your child is registered to vote? As with the address on the driver’s license, it suggests your child is a member of your household if he or she uses your address on a voter registration.
We at The Bensman Group are happy to talk to you about these or any other insurance concerns you have. Just give us a call at 847-572-0800 or email@example.com.