Insuring a Teen Driver in Single-Parent Home

If your teen is away at school, living part-time with an ex-spouse, or spending a significant amount of time away from your single-parent home, you may be wondering if you are still required to keep them on your car insurance policy. Insuring a teenage driver can be an expensive endeavor, but depending on the circumstance and practices of your car insurance company, you may not be required to keep them on your auto insurance policy.

Divorced parents

The first thing single parents should do when deciding on which policy to claim their teen driver on, is to check the language in their car insurance policy or contact their auto insurance company for details. Some car insurance companies suggest that the parent who has custody of the teen while they are in school is responsible for having that teen driver on their auto insurance policy, while others say it is the parent who has custody of the child more than the other.

In some instances, if both parents have the same auto insurance company, the child will automatically be covered on both policies. The reason behind this is that some companies define "an insured" as "a person related to you by blood, marriage or adoption who is a resident of your household."

Honesty is the best policy

If you don't list your teen driver on your car insurance policy, you are risking more than you may know. For instance, if you neglect to list your teen driver during your application process or failed to add your teenager once they have received their driver's license; your auto insurance company could cancel your auto insurance policy for misrepresentation. Worse yet, if your teenager is involved in an accident or traffic violation and you don't have them on your auto insurance policy, you could risk having your car insurance policy become nonrenewable.

However, all auto insurance companies handle insuring teen drivers and single-parent homes differently. Some companies require that all drivers be named on both parents' car insurance policies, regardless of how much time they spend between households.

Worst case scenario

If your state permits auto insurance companies to void policies for misrepresentation, and your teen is in an accident and you file a claim, YOUR policy could be voided because you failed to tell them about your teen driver. So play it safe and contact your car insurance agent or company immediately once your teen has received his or her driver's license.

High risk teen drivers

Recently, The National Highway Safety Administration released the statistic below showing just how much of a risk teen drivers are to themselves and to others on the road.

• In 2004, 5,896 teenage drivers were killed in traffic accidents. Teens accounted for 28% of all the drivers involved in motor vehicle fatalities

Teen drivers pose a higher risk of accidents than other groups of drivers, which is why the car insurance rates for this age group are so high. "On average, parents can expect to see a 50-100% increase in their car insurance rates once their teen has been added to their auto insurance policy," stated David Roush, CEO of Insurance.com. "However, many companies do offer parents discounts to help reduce the cost of insuring their teenager, such as 'Good Student Discounts' which are available to teen drivers who have a grade point average of 3.0 or above."