Our son is 18 years old and in College , staying in dorm. He got driving license and do not have a car. He is not driving.
Our insurance company says they got my son’s driving record from DMV and added him to our policy. Our insurance premium spiked (250%) due this. I have 17 year old car with only liability coverage and the premium is not look fair.How
How does my son’s getting driving license increase the risk by 250%?
They say that they did it as per their company guidelines. They say during college break our son comes home. He may drive the car, so we need to pay for insurance for whole year. It does not make sense.
As we spend money for his college and such premium hike cause more hardships. We were not told by DMV that we need to get auto insurance after getting the license . We know, if we buy a car need to have insurance. It looks weird the insurance company goes after DMV record and extract money from their parents.
It is an unjust enrichment. We bring this issue to get a balance resolution. What are the workaround? We talk with rep this afternoon. They did not offer any resolution apart from apologizing.
Are there any agency have oversight on Auto Insurance companies unjust enrichment practice?
You may be able to exclude him from coverage. If he drove your car, even without permission, he would be uninsured, which means a) he could be ticketed and b) if he were involved in an accident, your insurance would not cover the liability.
Post #3 is not correct. Your son wouldn’t be ticketed if he has your permission to drive your car. If he should get into a car accident when he is driving your car, he would be covered under your insurance.
I got a big break when D1 went off to college even though she had car that she didn’t bring up to college.
You need to shop around to find an insurance company.
He doesn’t need to be insured if he doesn’t own a car.
I have a car, D2 has a driver’s license and she is not insured (not on my policy). You can have a license without owning a car. Insurance company insure cars, not people.
If you do not own a car, you would be hard pressed to find an insurance company to give you an auto policy. I tried to get one when I lived abroad for few years because I always rented a car when I came back to the states. The insurance I could get from the rental company didn’t cover liability outside of damage of the car.
@oldfort if you exclude a driver, they are not insured under your policy.
For instance, my dad was hit by a guy driving his girlfriend’s car. The driver was named as an excluded driver on the policy (because this particular accident was not his first DUI), and the girlfriend’s insurance did not pay out; my parents’ uninsured motorists coverage did. The driver also got a ticket for no insurance.
The OP’s problem is that their rates are being spiked by a non-driver, and that spike is caused by the fact that he would be covered if he drove. They could exclude him to get the lower rate. But excluding him means he is not insured under their policy under any circumstances.
Also, “not named on my policy” is not the same as “excluded.” If my mother drives my car, my insurance would cover her, even though she’s not named on my policy. My mother-in-law is an excluded driver on my policy (her name appears in the excluded section), and if she drove my car, my insurance would not cover her.
I have never seen “excluded” section on my policy. I am asked who are other drivers on each car. In the OP’s case, he can either name his son as a driver on his cars, but get a discount because the son is away at college, or not name his son as a driver on his policy. But either way, OP shouldn’t see a hike of 250%. If OP doesn’t name his son on the policy, then his son wouldn’t be covered if the son should drive someone else’s car without insurance.
In my state, all drivers are required to have either an automobile insurance policy in force or, in limited situations, proof of financial responsibility. I’m sure it’s not the only state with such a requirement.
Talk with an insurance agent that represents multiple insurance companies to get other quotes. There is a lot of inaccurate information on this thread. He could be an excluded driver but that would mean there would be no coverage for the student or the parents if the student is in an accident. (Parents could be sued for negligent entrustment). He could be an insured under a policy insuring someone else’s car that he was driving by virtue of being a permissive user. If he is not home most of the time and is not driving the covered auto regularly the rate should not increase 250%. Talk to an expert.
some of this is state law driven - for example Massachusetts does not allows policies for driver’s who do not own a car (or have access to a car where they live - such as a family member)
The price increase may be excessive, but it’s not “unjust.” Your rates are determined in part by who is in your household. Your son is a member of your household and can reasonably be expected to drive your car when he’s home. He’s only 18, so that causes a rate increase.
If he’s in college more than 200 miles away, it can reasonably be expected that he won’t be home every weekend. If this is the case, then you should inquire as to whether your insurance company offers a reduced rate for “college student away.” If your company doesn’t offer such a discount, ask other companies.
But if your student is attending college in the next town over, say 30 miles away, it’s also reasonable to expect that he may be home every weekend - and may be driving your car when he’s home.
Finally, since he now has a license, your son may also end up driving someone else’s car while he’s at college - perhaps just to make a trip to the grocery store. The protection he’s provided under your policy at home would also provide some coverage in this situation.
Finally, it’s not the DMV’s job to tell you that your insurance rates will go up when your teenager gets a driver’s license. You should have asked your insurance company. But don’t feel bad about not making that phone call - none of us do, and we’re all surprised when our rates go up for the first time!
My insurance company (Geico), told me that now the kids aren’t living at home, take them off the policy. When we told them when the kids were in college (far away), they did not charge us additional for the kids. Also, even when they were in the home, they do not charge up for young drivers.
I’m not sure how an insurance company can decide you must put someone on your policy. I would look elsewhere, and check out Geico. Get a quote online, very easy and straightforward!
Back when my son was close to turning 16 my insurance company sent out a questionnaire asking if we had anyone in the household tha would soon be of driving age. I remember thinking this was really odd.
Our first increased quote directly from our insurance company was laughable, something like $14,000 a year for the 4 of us. Seriously?
We called our insurance agent who was then was able to get us a much better and very reasonable charge
Kids neeeded to be added to our policy here…required…when they got their driver’s licenses. No, neither had their own car. They were driving our cars.
It took practically an act of God to get DD off of our policy for the 27 months she was in the Peace Corps. It finally happened…but sheesh…she was forbidden to drive…anc clearly she wasn’t driving any of OUR cars.
Boys are expensive. When our DS got his license, and was added to our policy, the premium went WAYYYYY up as well.
The key is they’re licensed and have access to a family car, when home. Doesn’t matter if you hide the keys, it’s theoretical. But when they go off to a college at least X distance from home, the rates can drop substantially.
About companies. Our former insurer wanted to increase us by about 50% (two girls, we held off letting them get their licences until we resolved this. Boys are generally assessed higher, based on claims stats.) DH shopped around and the new pricing, via AAA, left the total for house and cars about 30% less than the former wanted to charge us for car insurance alone. Anyone will tell you, considering a switch is well worth the effort.
Post grad, after a year abroad, D1 lived at home a while. She had to be on my policy (did drive one car) until she got her own car. Then, they were happy to drop her, with proof she had her own policy for that vehicle.)