UPDATED: Mar 13, 2020
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Adding people to your insurance policy can be one of the most convenient, affordable and efficient ways to let more people get around with the same vehicle.
A named driver is anyone who is named on your insurance policy, thereby meaning that you can let them drive your vehicle at any time as though it were their own. As it is generally only possible to insure the owner of the vehicle as the driver (even though there is no law against policies that are for drivers other than the owner), that means that this is the only way to – for example – allow your whole family to drive your car.
But how much extra does it cost? And how else can it affect your policy?
How Your Policy Can Go Down in Price!
How much extra does it cost to insure another driver on your policy?
Actually, it sometimes costs less. And in other cases, it can cost a lot more…
As ever, it is very important to consider the specific circumstances, the drivers and the nature of the vehicle itself when considering what the best course of action is.
The first and most important question is whether you already have the policy. If you have your policy and you wish to let someone else drive your car for a while – or perhaps just for a month – then it will almost always cost extra.
However, if you are currently going through the process of filling out the online form to get your auto insurance quote, then you’ll find that adding an extra person to your account can cause it to go up or down.
So if you are someone who is very difficult to insure (a young male for instance) and you are adding someone who is considered low risk (your Mom), then this might be seen as a good sign and it might put the insurance company at ease – meaning that your premiums go down.
This isn’t always the case though – it depends on the drivers, on the car, and on the provider.
How Much Extra to Expect
On the other hand, if you want to add someone on to an existing policy, then you are asking for an extra service and in all likelihood, you really need that additional driver… which means that the company has you at a disadvantage and can charge whatever they like. That’s just the way that the cookie crumbles!
However, you shouldn’t worry too much. If you need to add someone to your insurance policy and they are considered low risk, then you may find that they actually only cost you a one-off fee to amend the policy – which may be around $30-$50.
The monthly fee may then go up slightly or stay the same but either way, you will need to pay the fee.
How much the policy is likely to go up will, of course, depend on all the same factors that you are probably used to affecting your policies. For example, the age of the driver, their no-claims bonus and their gender. Adding a middle-aged woman with no history of accidents to your policy should cost very little!
Note that many insurance companies provide the option to add a temporary driver to their policy. Temporary policies will normally last around 90 days.
Who Should Pay for the Insurance?
But what if two of you will be driving the car equal amounts? In this scenario, who should be considered the lead driver?
The answer is that it should always be the owner of the vehicle. That means it should be the person who has the title deeds to the car and who pays the tax etc.
Do not consider trying to ‘dupe’ the insurance companies by taking out insurance in another name. A common trick parents will attempt is to take out insurance for their children who are just learning to drive and then to make the child the named-driver.
However, this is actually an illegal activity called fronting and if you are caught it could lead to a criminal conviction. And the company will be within their rights not to pay out in the case of an accident.
Even if you pay for the car, the deeds should be in the name of the person who will drive it most and they should be the lead on the insurance policy. To avoid fronting scams, some insurance companies will automatically refuse to add any young/new drivers as named drivers.
What Happens if There’s an Accident?
The other piece of bad news is that if you have an accident, your no-claims will still be affected and you will still need to pay the excess. So if you are doing your daughter’s partner a favor by insuring them on your car, just know that you might end up paying for it if they have an accident.
This can also affect their no claims of course. Although it is worth knowing that it is also possible to build up no-claims if you are a named driver. That means that if you are between cars and you want to protect your bonus, you can ask a friend or family member to insure you and then use that in order to keep yours going!
As ever, there are many more questions to consider. These include the maximum number of drivers you can add to your account, whether or not the driver might have a policy that covers them to drive any vehicle (which is rare, unless they are in a particular line of work) and whether the policy will hold if you go to other states or countries.
This is why it’s so important to look around and compare quotes and to provide as much detail as possible when doing your research!