Transferring A Vehicle To Your Child And Then Getting Them Insured

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Rachel Bodine graduated from college with a BA in English. She works as an associate editor and writer for for over a year and enjoys creating content that offers expert advice on car insurance topics.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs...

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Reviewed byLeslie Kasperowicz
Former Farmers Insurance CSR

UPDATED: Mar 13, 2020

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There are many things to worry about once your child becomes of legal age to drive. His or her safety behind the wheel is probably the most nerve-racking thought during this time. In addition, there is also a whole slew of legal hoops to jump through that will also weigh on your mind as you prepare your child for life behind the wheel.

How To Transfer Car Ownership To Your Child And Add Them To Your Insurance Policy

If you are planning on getting your kid set-up with a car to drive, and you want the vehicle to be listed under his or her name, then you will need to transfer the vehicle’s title. A car title is a document that legally establishes who owns the vehicle. In order to transfer the title to his or her name, you will need to go to the Department of Motor Vehicles in the area that you live and proceed from there.

Selling, Buying, and Transferring Ownership of Vehicles

In most states, if you are purchasing a vehicle for your child you will need to have a vehicle bill of sale. This is a document that outlines the terms and conditions of the purchase of the vehicle. This document will include the purchase price, the make, model, and year of the vehicle, the VIN, the warranty, and the odometer reading at the time of purchase. It also includes the addresses of both the buyer and the seller. If you are the buyer but are purchasing the vehicle for your child you will need to have the name of the child on the bill of sale as title sample

The bill of sale represents the legal transfer of the right to ownership of the vehicle. Once the bill of sale has been signed, the buyer will need to visit the DMV in order to apply for a title to transfer the vehicle to their name or their child’s name. When visiting the DMV for a title transfer you will want to be prepared to pay a transfer fee and possibly a smog certification depending on the state or city that you live in.

Transferring Car Ownership to a Family Member

Even if you are simply transferring the ownership of a vehicle from yourself to your child, almost all of the same vehicle title transfer regulations and procedures will apply. The one difference is that the person who is receiving the vehicle will typically not have to pay the sales tax for the vehicle. Parents, grandparents, spouses, children, siblings, partners, and grandchildren are all considered eligible for a “family” title transfer. The rest of the transfer process is the same as if you were buying or selling a vehicle.

When transferring vehicle ownership to your child it is important to contact your state’s DMV for the specific regulations and procedures in your particular state and city as the laws vary from state to state.

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Adding a Child to your Insurance Policy

Another thing to consider when you are transferring the ownership of a vehicle to your child is the insurance. Adding a child to your car insurance policy may be a bit scary because not only is your child going to be behind the wheel, but you are also looking at an increase in the cost of your insurance.

When do you Have to Insure your Teen?

Most car insurance companies do not require you to formally add a teen driver to your policy until they are a fully licensed driver. This means that you typically do not have to add your teen while they only have a learner’s permit.teenage driver insurance

However, if you have a teen with a learner’s permit you will want to notify your auto insurance provider as there might be specific regulations put in place by the company that you will need to follow.

When your teen becomes a licensed driver, you will need to have them added to your current insurance policy or buy a separate insurance policy for them. Typically, parents will choose to add a child to their current policy as this is often the cheaper option when it comes to teen auto insurance.

Car Insurance Rates for Teens

When adding a teen to your insurance policy you can expect that your rates are going to go up. The reason for this is because teens are some of the highest risk drivers and an insurance company is taking on a bigger risk when they insure a teen.

When considering adding your teen to your insurance policy it may be a good time to shop around for a new car insurance policy. It is a good idea to get quotes from several insurance companies in order to see which one will offer the best deal.

When shopping for insurance for your teenage driver, you can check prices for a separate policy for your teen. In most cases, you will find that it is going to be cheaper to simply add them to your current policy or to create an entirely new policy with another company that includes all of your household drivers.

Overall, transferring a vehicle to your teen is a fairly simple process that will involve a trip to the DMV to fill out the necessary paperwork. Adding your child to your car insurance policy will involve a bit of research into different insurance policies that are available and choosing one that works best for your budget and needs.

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