Tuesday, 12 February 2013

Parents Fib to Slash Young Drivers Insurance

A comparison website has revealed that 10% of parents are happy to commit fraud to help save money on their kid's young drivers insurance.

Essentially the parent is engaging in a fraudulent scam, otherwise known as "fronting", to reduce car insurance premiums. This scam involves a parent or older driver to insure the car in their name, however, in reality the young driver is the main driver.

Committing car insurance fraud is illegal and really not worth the risk as it could invalidate the car insurance as well as lead to a criminal record. To find out more about the dangers of fronting we recommend reading our article on the importance of supplying your insurer with the correct information - which expands further on why you should avoid fronting.

According to the road safety charity, Brake, a fifth of new drivers are involved in a crash within 6 months of passing their driving test. Figures also show that an 18 year old young driver is three times more likely to have an accident than a 48 year old. Stark figures that highlight the importance of ensuring that newly qualified young drivers are insured correctly.

To bring down the cost of car insurance for young drivers’ iKube recommends looking at a telematics (black box) insurance scheme. In addition to this the parent could look at adding themselves as a "named" driver as this could help also help to reduce the premium.

By adding a named driver and opting for a black box insurance scheme the young driver may not only reduce the premium in the first year but can continue to benefit from the scheme.

In the case of iKube, for example, as long as the young driver avoids late night driving and drives carefully, then they can continue to benefit from the discounts that iKube offers at renewal.

Source: http://www.telegraph.co.uk/finance/personalfinance/insurance/motorinsurance/9862451/The-parents-who-lie-to-cut-their-childs-car-insurance-costs.html