Maybe your teenager just passed her driving test and is now a G1-licenced driver. Or perhaps your university-going son and G-licenced driver is back home for the summer. If you have young drivers in your household, who are using your vehicles, then this means they’re on your insurance policy, which may have you concerned. What does this mean for your rates? And what potential consequences could your kids cause to your good record?
Here, we’ll look at how you can manage your insurance policy — and your kids — to help ensure your standing with your insurance provider remains a solid one.
Adding one or more young drivers
Automatically, you can usually expect an increase in premiums by adding another driver to your policy. With the exposure a new driver brings, your insurance company will do an assessment to see what kind of increase you can expect. Regardless of the additional cost, it’s a good opportunity to teach your child responsibility and you may want to consider having him or her pay the amount of the premium increase.
Age matters
Age — and experience — matters when it comes to just how much of an increase you’ll see in your rate. A driver who is 16 to 24 will automatically cost you a higher premium. A child who is 25 or older will be added as a secondary driver on your policy, and his or her driving record and experience will be assessed when determining the type of increase you can expect to see.
The key factor is your kid’s driving record/age ratio. A 25-year-old driver with a clean driving record will cost you substantially less than if he or she were 24 and had the same clean record. Also, if your son, for example, is a part-time driver of your vehicle, the cost will be incrementally less than if he is a full-time driver, as stated on your policy.
Your child’s driving record
Does your kid have a couple speeding tickets on her record? If she is added as a secondary driver on your policy, her spotted driving record could cost you a 10-star policy rating, regardless of her age. If your child causes an infraction while on your policy it may be a good idea to restrict his or her driving privileges to nil. You may also want to urge your child to get their own coverage, so that they fully understand the repercussions of bad driving, including the cost of insurance.
Teaching responsibility
If you do have a bad driver under your roof, take charge. Don’t let their bad habits ruin your hard-earned good standing with your insurance provider or your star rating. If you are in Ontario, you must have all drivers who reside under your roof and use your vehicles on your policy — but there’s an exception to this rule.
The OPCF 28A (see this month’s Did You Know for all the details), is a form you can add, excluding your child from your insurance policy. You will have to sign the document stating that your child is in your household but not driving your vehicle, thus helping protect your rate and your star rating.
How to avoid policy setbacks
Your child got a speeding ticket — but didn’t tell you. Does this mean you’re in the clear because you didn’t cause the infraction? Not necessarily. Your insurance provider may find out about it when you go to renew your policy. Plus, if you apply for a new policy, the ticket may surface when your record is being reviewed. As the policy holder, know that you are fully responsible for knowing the records of all secondary drivers on your policy. You could face an increase due to your child’s mistake. You can order a driving report on your child by visiting InsuranceHotline.com and its list of helpful resources.
If your child does choose to get their own insurance, be sure to have him or her visit InsuranceHotline.com where he or she can compare rates from over 30 competing insurers for the lowest rate available.
Other helpful insurance articles:
- Find out what is an OPCF 28A in the "Did You Know?" section of the InsuranceHotline.com Insider
- What are the consequences
of major and minor tickets?
- Learn summer safety driving tips
- "My child is home from university for the summer. Do I have to
add his or her name to my car insurance policy?" Click here
to read the answer.