Around 12% parents surveyed said they would insure their child’s car on a policy in the parent’s name in an attempt to reduce the premium their child would have to pay.
The practice, known as ‘fronting’, is done by some parents in the hope of sparing their children from expensive premiums.
Fronting is when a lower risk – usually older – driver, insures a vehicle in their name, but the actual main driver falls into a higher risk category, such as a young or inexperienced driver. Though the idea behind fronting is to save the young driver money on their premium – in actuality it is fraud and could invalidate their insurance and even land them with a criminal record.
In the Gocompare.com study, 1 in 10 (13%) parents confessed to having lied on their own insurance applications. And a quarter (24%) would consider lying to their insurer if it meant saving money on their premiums. Furthermore, 1 in 5 (20%) parents said they considered car insurance to be ‘a complete rip-off and would gladly tell a white lie if it reduced their premium’.
Despite this, the research showed that parents are generally aware of the consequences that might arise from lying on their insurance application.
The study showed that 9 in10 (87%) acknowledged that they knew they could have their insurance claim rejected as a result of lying to their insurer, but 1 in 20 either doubted insurers would ever find out or believed their mistruths would bear no consequence.
Scott Kelly, head of motor at Gocompare.com, commented; “Our research seems to show a general lack of understanding of insurance by parents, which they could be passing on to their children. For instance, 17% of parents said they would advise their child to downgrade their cover to third party fire and theft to reduce their premium. However, there is often little or no difference in the cost of a comprehensive or third party fire and theft policy. So far from saving them money, this advice could just leave their child with a poorer level of cover
“We can’t stress enough the importance of telling insurers the truth, as any deviation from the facts may result in any future claims being refused. There are plenty of perfectly legal ways to reduce premiums for young drivers which don’t result in them being underinsured or criminally liable.”
“Instead of ‘fronting’, parents should consider adding themselves as a named driver on their son or daughter’s policy. Having a more experienced driver on the policy should lower the premium and would still allow the younger driver to gain No Claims Bonuses (NCB) which will help lower future premiums significantly.”
For example, the cheapest quote for an 18-year-old driver with a 1.0 Vauxhall Corsa; came from Endsleigh at an annual premium of £1,625.11. However, by adding an experienced driver to the policy as a named driver, the cheapest quote was £1,516.92 a saving of £108.19 from the same insurer!***
Scott adds; “Another way for both inexperienced and experienced drivers to lower their premiums is to consider a telematics policy. This involves having a GPS-enabled ‘black box’ fitted to your car to track the way you drive. A telematics policy could be an ideal way for young, new or low millage drivers to prove to their insurer that they deserve to be rewarded with a cheaper premium and – especially in the case of younger drivers – encourage good driving habits. In the study, 30% of parents said that they would recommend that their child consider one.”
“The best way to save money on your car insurance is to do your homework and shop around. Using a price comparison site, like Gocompare.com, is a great way to make sure you’re getting the cover you need at the best possible price.
