The short answer is, you can stay on your parent’s car insurance policy as long as they will allow it. However, it’s more important to know when you MUST be listed on their policy!
When Must I be Listed on My Parents Car Insurance?
Insurance companies are very concerned when there are young, inexperienced drivers in the household, and in most cases, they will require that all licensed drivers in the household be listed on the parent’s policy, especially if the child is going to have access and permission to drive the car. For the majority of insurers, the rules will be as follows:
- Licensed Residents: Your insurer is going to require the policyholder (your parents) to provide the information about all licensed drivers in the household, whether they drive the insured vehicle(s) or not.
- Driving Records: Your insurer is very likely to obtain the driving records (motor vehicle report) for every licensed driver in the household whether they drive an insured vehicle or not. Typically, most insurers will waive this rule if a young driver in the household owns their own vehicle and proves that it is insured on another policy in the name of the young driver.
- Away at School: Even when you are living on campus and rarely home for a visit, if you have your parent’s car with you, the insurer will require you to be listed on the policy. If, however, you live away from home while attending school and only drive your parent’s car while visiting during the holidays or in the summer, some insurers will no longer consider you a resident and will allow your parents to remove you from the policy.
- Not in School, living away from home and driving your parent’s car: No matter where you are living, if you have possession of your parent’s car, the insurer is going to require you to be listed on their policy as a regular driver, and the policy will be rated accordingly.
What About the Exclusion Provision?
If you are living with your parents and never drive one of their insured vehicles, some car insurance companies will allow you to sign an “exclusion statement” which affirms that you will never drive one of their insured vehicles. If you do drive one of their vehicles and a loss occurs, coverage will most likely be denied.
Own Car, Own Policy
If you are living with your parents and have a car titled in your name, and it is insured in your name, most companies will not require you to be listed on your parent’s policy. Some companies, however, may require your policy to have the same liability limits as your parent’s policy.
When Can I Not be listed On my Parents Car Insurance?
You can be listed on your parents’ car insurance as long as they (your parents) allow it. But, and this is very important to understand, many insurers will not allow a car that you own, be covered on their policy. The reason is that if you own the vehicle, your parents have no “insurable interest” in your car. Car insurance requires the named insured (your parents) to have ownership (insurable interest) in any vehicle listed on their insurance policy. There are, however, some companies that will allow your parents to insure your car while you are living in the household.
These are how most insurance companies handle these situations, however not all insurers play by the same rules. To be clear about your particular situation, have your parents call their agent or insurer to find out how and when you should be listed on their policy.