New driver - Insurance

[Pete 75C]

OK, here's the back story...

My son's 19 next month and after a few lessons, he's booked an intensive course with that 5-day place in Norwich (the company with the annoying yet catchy radio jingle).

So, assuming that in a couple of months, he'll be legally mobile, thoughts have turned to his first car.

I'm getting a little bored with driving around in the little automatic Citroen C3 that my wife uses as a shopping trolley so I'm happy to buy something in my name and to insure it in my name. It need only be for a year, as our emigration date is looming (perfectly timed to coincide with the aftermath of Brexit).

We've kinda agreed on a 2006 Seat Leon 1.6... engine size might be a bit bigger than a new driver needs, but it's a decent car with good visibility. It will never turn any heads, but hey - I don't care about that. My son is fussy and insists he wants to be a little bit different with car choice. Initially he fell in love with a 1999 Alfa GTV 2.0 TwinSpark (yeah, right... the perfect car for a new driver, not). Having lived in Spain and owned a couple of Ibizas, I have no issue with Seat, in fact I rather like them - they're a common car but not so common as a Corsa, Fiesta, <insert boring little hatchback here>, etc etc.

My question is... if I give him the money, he buys the car, registers it in his name and gets an insurance quote soley in his name, it will cost at least two arms and half a leg (which will make the car impossible to drive). Now if I buy it, insure it in my name and add him as a named driver, the insurance takes a leap up from what I'd expect to pay as sole driver, but it is still much more affordable than scenario 1.

Are there any small-print pitfalls to watch out for with "named driver" policies. Remember, I'll be using it more than him... he'll probably only take custody of it at weekends for trips to Acle to visit the girlfriend, etc etc.

Edited June 15, 2018 by Pete 75C

[chris p bacon]

I'm trying to remember why I didn't do it for No 1 son* and if I'm right it's because all you're doing is leaving the high cost until the next year. With him being a named driver on someone else's policy he doesn't actually start his own insurance history. No 1 son worked in Pensions/insurance and worked out it was better in the long run to bite the bullet and buy a car that he could insure rather than a car he wanted but coulnd't afford to insure.

 

If me I'd find out what he'd have to pay for various models in his own name.

 

 

* I have a thought that the excess to pay for him on the policy was nearly the same as his own policy.

[Guest]

I'm trying to remember why I didn't do it for No 1 son* and if I'm right it's because all you're doing is leaving the high cost until the next year. With him being a named driver on someone else's policy he doesn't actually start his own insurance history. No 1 son worked in Pensions/insurance and worked out it was better in the long run to bite the bullet and buy a car that he could insure rather than a car he wanted but coulnd't afford to insure.

 

If me I'd find out what he'd have to pay for various models in his own name.

 

 

* I have a thought that the excess to pay for him on the policy was nearly the same as his own policy.

 

That makes sense, I can understand that any insurance history of his own will be deferred if he's just a named driver on my policy. Don't forget that next year, we won't be in the UK so he is likely to have to start all over again in 2019 anyway.

I'll get him to get a quote on this particular car in his own name, but he's done that recently on some "normal, sensible" cars and the quote was still in excess of £1200, sometimes rising to almost £2000. At the moment, the difference between "policy in my name only" and "policy in my name with added driver" is around £320... that's quite some difference!

[Zero Gravitas]

One tiny problem - what you’re proposing could easily be interpreted as “fronting” and is illegal:

 

https://www.moneysupermarket.com/money-made-easy/why-fronting-for-your-child-could-cost-you-dear/

 

Probably not a good idea.

 

(Edited to make it clearer that the interpretation is important)

Edited June 15, 2018 by Zero Gravitas

[Derekl]

The short answer is, don't and not for the reason above, unless you intend to be primary driver of the car and your son occasional - that is irregular and not that often. That doesn't seem to be the scenario. Insurers regard insuring the car for a parent as primary driver with off spring as named driver where the latter does most of the driving with some disfavour. If anything goes wrong they will investigate and there is a serious risk of having the policy voided which can be an expensive exercise.

 

The best course of action  is to look for a real "cream puff" despite the son' aspirations to 2 litre Alfa Romeos. I am afraid it is small engine Fiesta or similar, insurance for which will still be north of £1K, but is useful to build experience and move to the higher aspirations in a few years. 

[chris p bacon]

One tiny problem - what you’re proposing is called fronting and is illegal:

 

https://www.moneysupermarket.com/money-made-easy/why-fronting-for-your-child-could-cost-you-dear/

 

Probably not a good idea.

 

 

For a split second I read that as 'Frotting'.........mind you, Pete is from Norfolk where anything goes....

[chris p bacon]

As a present to my friends children (3!!!) I purchased 10 driving lessons each for them when they were 17* when they all passed I was surprised at how low their polices were as they took black boxes and did the extra lesson after passing. The Girls were about £700 and the lad was £750 (Corsas & Fiestas)

 

 

 

* at the request of my friend I hadn't done much for xmas/birthdays over the previous years,  there was a competition between grandparents over who could give the most so it got stupid.

[Guest]

One tiny problem - what you’re proposing could easily be interpreted as “fronting” and is illegal:

 

https://www.moneysupermarket.com/money-made-easy/why-fronting-for-your-child-could-cost-you-dear/

 

Probably not a good idea.

 

(Edited to make it clearer that the interpretation is important)

 

From the OP...

"Remember, I'll be using it more than him..."

I don't actually own a car (I have a van which is often impractical day-to-day), so it will be mine, and I'll do around 5000 miles a year. I estimate he'll do a helluva lot less than that, using it perhaps 1-2 days every fortnight.

I'll leave you to work out who the main driver truly is, so I think mention of "fraud" in the link is not quite the same situation...

[Zero Gravitas]

The short answer is, don't and not for the reason above, unless you intend to be primary driver of the car and your son occasional - that is irregular and not that often. That doesn't seem to be the scenario. Insurers regard insuring the car for a parent as primary driver with off spring as named driver where the latter does most of the driving with some disfavour. If anything goes wrong they will investigate and there is a serious risk of having the policy voided which can be an expensive exercise.

 

The best course of action  is to look for a real "cream puff" despite the son' aspirations to 2 litre Alfa Romeos. I am afraid it is small engine Fiesta or similar, insurance for which will still be north of £1K, but is useful to build experience and move to the higher aspirations in a few years.

 

Interestingly (having been through this with two offspring now) it’s often more expensive to insure that sort of small-engined small car because that’s what most new drivers have and so the claim fate against that type of vehicle is higher. Often a larger, duller car is better for starters - daughter ended up with a 1.8 diesel focus estate that was cheaper to insure than a 1.3 petrol fiesta...

 

Putting yourself as a named driver definitely helps (assuming you own driving record is good :-) ), and really shop around...

[Ryde-on-time]

 

....................... I'll be using it more than him... he'll probably only take custody of it at weekends for trips to Acle to visit the girlfriend, etc etc.

If that it really the case then buy and insure in your name with him as a named driver

 

As others have said though insurance companies do get suspicious of 'fronting' so would be worth keeping a record of who drives when and how far, just so you have evidence in the future that you insured it correctly

[Guest]

For a split second I read that as 'Frotting'.........mind you, Pete is from Norfolk where anything goes....

 

I'd never even heard of that. What you get up to down Dogger's Lane in leafy Beds is entirely your own affair, Dave...

[Zero Gravitas]

From the OP...

"Remember, I'll be using it more than him..."

I don't actually own a car (I have a van which is often impractical day-to-day), so it will be mine, and I'll do around 5000 miles a year. I estimate he'll do a helluva lot less than that, using it perhaps 1-2 days every fortnight.

I'll leave you to work out who the main driver truly is, so I think mention of "fraud" in the link is not quite the same situation...

It doesn’t matter who I think the main driver is - that’s why I edited my post. If something happens and the insurance company find he’s driving a car registered in his name, some distance from home and he’s only a named driver then the insurance company’s interpretation is likely to be fronting, which opens up a whole new world of insurance pain...

 

It all depends on your risk appetite...

[Guest]

As others have said though insurance companies do get suspicious of 'fronting' so would be worth keeping a record of who drives when and how far, just so you have evidence in the future that you insured it correctly

 

Keeping a driving record of "who, when, how far" etc makes perfect sense but sadly I have a sneaking suspicion that the insurer would consider it not worth the paper it was written on in the event of any claim.

[Guest]

It doesn’t matter who I think the main driver is - that’s why I edited my post. If something happens and the insurance company find he’s driving a car registered in his name, some distance from home and he’s only a named driver then the insurance company’s interpretation is likely to be fronting, which opens up a whole new world of insurance pain...

 

It all depends on your risk appetite...

 

The insurance companies do seem to like playing God, don't they?

Let's say I do 4550 miles in the first 10 months and he has done 800. Let's assume he has a prang on the way to visit his girlfriend one night. The insurer will likely assume "fronting" and as you say, begin to inlict pain. No matter what I say or do, I'm unlikely to convince them otherwise, so I have to wonder, why do the insurance companies even allow young named drivers? The cynic in me thinks that they just want the premium and don't give a sh*t about the consequences.

If anyone's aware of some kind of black box that recognizes different drivers, do let me know, because the above scenario of 4550 miles vs. 800 is probably not far from the truth, and I genuinely don't see how you could dispute that as being "occasional".

[colin penfold]

A couple of my son's friends have got cars recently. They have saved money by having black box type policies. I'd advise that route as your son will be building his own NCD rather than risking yours

 

SEAT Arosa.

[Zero Gravitas]

The insurance companies do seem to like playing God, don't they?

Let's say I do 4550 miles in the first 10 months and he has done 800. Let's assume he has a prang on the way to visit his girlfriend one night. The insurer will likely assume "fronting" and as you say, begin to inlict pain. No matter what I say or do, I'm unlikely to convince them otherwise, so I have to wonder, why do the insurance companies even allow young named drivers? The cynic in me thinks that they just want the premium and don't give a sh*t about the consequences.

If anyone's aware of some kind of black box that recognizes different drivers, do let me know, because the above scenario of 4550 miles vs. 800 is probably not far from the truth, and I genuinely don't see how you could dispute that as being "occasional".

I think you’re right. One thing - you mentioned in the OP that the car would be registered in his name. I think that would be the problem for the insurance company - why is he not the main driver if the car is registered in his name? If you registered the car in your name and you were the main driver with him as a named driver, it’s much more difficult for any insurance company to argue that he is not an occasional driver.

[jcm@gwr]

We're going through the same situation at the moment with No 4,

(I know, but I found out what was causing it and put a stop to it!).

 

Anyway, we decided that the cheapest option in the long run was

to have him as the car owner/keeper and primary insured driver,

with SWMBO as a named driver (better overall driving record and

lower mileage than me)

 

He's quite pleased with quotes around £97 p/month for a VW Polo

1:4L 5 door, that will of include a black box.

 

Edit to add that he is nearly 18 and is hoping to pass his test soon.

Edited June 15, 2018 by jcm@gwr

[njee20]

There has to be reasonable belief that you are committing an offence, the insurance company can't just roll over because it was him who crashed and he's a named driver (after all statistically it's far more likely the young driver will crash). The circumstances would be significant - if he was driving to work (for example) which is something he probably did every day, and could thus be assumed to be the main driver, it looks a lot worse than if something happens driving to his girlfriend's at the weekend. I agree that registering it in his name is an odd choice if it's not "his" car though, I wouldn't do that, it achieves nothing other than potentially reinforcing that you're hiding something.

 

Policies with a black box will be far cheaper, but you'll obviously be bound by them too, it doesn't know who's driving, and your bad driving would influence everyone on the policy. Look out for curfews and so on as well, which again you'd have to be bound by.

 

Some policies now allow named drivers to accrue a NCD, so it's worth looking around and getting some quotes. It is crazy expensive, but the insurance companies certainly aren't making a fortune off motor insurance!

[Dunsignalling]

The insurance companies do seem to like playing God, don't they?

Let's say I do 4550 miles in the first 10 months and he has done 800. Let's assume he has a prang on the way to visit his girlfriend one night. The insurer will likely assume "fronting" and as you say, begin to inlict pain. No matter what I say or do, I'm unlikely to convince them otherwise, so I have to wonder, why do the insurance companies even allow young named drivers? The cynic in me thinks that they just want the premium and don't give a sh*t about the consequences.

If anyone's aware of some kind of black box that recognizes different drivers, do let me know, because the above scenario of 4550 miles vs. 800 is probably not far from the truth, and I genuinely don't see how you could dispute that as being "occasional".

The practical way to avoid any suspicion of fronting is to add the named driver to a car you have already insured for a couple of years. i.e. the family hack.

 

It is legal for him to drive in a hat and false moustache if that's too mortifying.

 

Powerful exotica like Alfas will likely cost him more to insure than to buy until he has amassed couple of years claim free as a sole driver.

 

"Cool" will cost until that time, the only decision is whose pocket it comes out of..... 

 

John

Edited June 15, 2018 by Dunsignalling

[Guest]

To clear up any misunderstanding...

We did consider buying him a car which would be registered in his name and insured solely in his name. His annual mileage would have been fairly low.

However, as I could do with a runabout other than the van, the sensible thing is for me to buy a car (in my name) and for him to have occasional use (I'll probably do around 5-6 times his mileage).

At no point did we consider a car registered in his name but insured in my name with him insured only as a named driver. I can see how the insurer would take a dim view of that...

[chris p bacon]

If his mileage is that low, just get him a bike 

 

If you get a tandem that would accommodate the Girlfriend

Edited June 15, 2018 by chris p bacon

[Joseph_Pestell]

Buy a classic car and insure through Owners' Club. Much cheaper for a young driver to insure (and now it won't need an MOT either).

 

Still builds up no-claims for future cars.

Edited June 15, 2018 by Joseph_Pestell

[njee20]

Much less safe when he crashes it too, if you're bothered by such things.

[Enterprisingwestern]

Much less safe when he crashes it too, if you're bothered by such things.

 

Nice to have someone with a positive outlook around the place.

 

Mike.

[Ron Ron Ron]

Interestingly (having been through this with two offspring now) it’s often more expensive to insure that sort of small-engined small car because that’s what most new drivers have and so the claim fate against that type of vehicle is higher.

Often a larger, duller car is better for starters - daughter ended up with a 1.8 diesel focus estate that was cheaper to insure than a 1.3 petrol fiesta...

 

 

This is a useful point for anyone thinking of buying a car for a young driver, whether their first car or not.

 

Insurance premiums are calculated from assessing a very broad set of risks factors, against historical insurance claims data.

There are many factors involved, such as the obvious ones, like post code (how high are the number of claims in that area), is the car garaged overnight, parked on or off the public road (theft and damage risks), age of the driver, amount of driving experience, previous insurance history, previous claims, previous traffic offences, criminal record (fraud risk) etc, etc.

 

When it comes to the car being insured, apart from factors like model, trim level, engine size, age of the vehicle, current value, estimated annual mileage, how expensive is the model to repair etc;  they also look at how commonly there are claims on that make and model of car.

Most importantly not only do they look at historical data on accidents and claims involving the same or similar cars with the same attributes....but also who was driving them.

 

When it's all added up, apart from the usual long list of risks that are factored in, the added risks and accident data associated with young and inexperienced drivers results in the highest levels of premiums.

 

Note:

young drivers under 25

mostly but not only male

the most common makes and models of car in which they drive (Fiesta, Corsa, etc,)

 

In other words, most accidents and claims involve young, mostly but not exclusively male drivers, driving small engined popular young driver's cars.

Many parents make the assumption that as most other youngsters drive these sort of cars, that must be OK for insurance. Not.

 

Choosing a car less commonly used by new drivers may reduce premiums, but it's not always the case if that model of car is more expensive to replace for repair, or in itself attracts a higher premium in general.

 

Simplistically, it's possible that a brand new car may be cheaper to insure in the youngsters name than a 5 year old one, based on the fact there are fewer youngsters driving brand new cars and therefore there are fewer claims.

 

There's also the factor that a driver is statistically more likely to be more careful and diligent with a newer car of higher value, especially if it belongs to a parent.

Therefore a newer, or new car, owned and registered in a parents name, but insured in the youngsters name, should attract a lower premium than if it is owned and registered by the youngster themselves.

 

It can be a minefield, but as with other things in life, it's worth doing your homework if you want to save a few hundred pounds.

On line insurance quote calculators are available to play with.

 

 

Fronting - Don't even think about it. Not only is it illegal, it will invalidate the insurance policy and the insurance company may also sue and are likely to blacklist you.

That can be an expensive mistake that could increase your insurance premiums for years.

It may also affect your house insurance premiums.

 

A couple of anecdotes...

 

A friend's son's first car was an old Land Rover.

It cost about £450 fully comp. in his first year, aged 18. (this was in 2010).

A relatively slow and un-sporty car.

Low value to replace if written off.

Very cheap repair costs and parts.

Very few 18 year old, first time drivers and historically a very low number of claims for such drivers, on that sort of vehicle.

 

At the same time, quotes to insure our 17 year old on a 6 year old Fiesta 1.0L ranged from £1900 to £2500 p.a

On a brand new Corsa 1.2L owned by and registered to Mum, but insured by our son (first car, first year of car insurance) we were quoted £1600

 

Good luck !

 

 

Ron

 

 

.

Edited June 15, 2018 by Ron Ron Ron