More than half of parents consider ‘fronting’ to reduce children’s car insurance premiums
New research from Gocompare.com Car Insurance has found that more than half (54%) of parents of young drivers have ‘fronted’, or would consider ‘fronting’, a car insurance policy for their children in order to get them lower car insurance premiums.
The practice, whereby a parent, usually a more experienced driver, indicates that they are the main driver of a vehicle which will most often be driven by a young or other high risk driver, is illegal and fraudulent. Fronting a car insurance policy invalidates the cover meaning anyone driving the vehicle would not be insured. What’s more, anyone caught fronting can end up in court, land themselves with a criminal record and harm their chances of being accepted for any kind of insurance in the future.
The research, carried out amongst 1000 parents of children aged 17-25 who’ve passed their driving test, found that 16% of the parents had already ‘fronted’ a car insurance policy for their child and 38% would consider it.
53% of the parents who took part in the research said that the cost of car insurance for their child was a ‘major concern’ and 30% said that the premiums were ‘far greater than expected’. 60% described the premiums quoted for young drivers as a ‘rip-off’ and more than half (51%) suggested that the cost of insurance for young drivers was a major factor in the number of young people driving without insurance.
Parents also indicated that the cost of car insurance was their second biggest concern when getting their child on the road, the first concern being safety.
Experts at Gocompare.com have come up with seven legal tips for younger drivers to help them save money on their car insurance.
Save £187* with a named driver
Fronting is illegal, however, adding another person like a parent who will be driving the car to your policy as a named driver could reduce insurance premiums significantly.
*Based on a 17 year old student living at home in Cardiff and driving a 1L Corsa, 2008. Difference calculated by the average of the top five cheapest premiums returned vs the top five cheapest premiums returned when a 50 year old accountant was added to the policy as a named driver.
Shop around
Some insurers will be more competitive than others for different drivers, vehicles and regions so there’s no such thing as a ‘best buy’ car insurance for every driver. In fact, some of the premiums quoted for young drivers are so eye wateringly expensive they clearly don’t want their business.
Comparison sites, like Gocompare.com, allow you to compare premiums from over a hundred insurance brands at once, and display the key features of each policy to help you make an informed choice. Independent research found that customers could save £286.44* on average by shopping around with Gocompare.com, meaning it can really pay to spend a few minutes online.
*By using Gocompare.com customers could save up to £286.44 on their car insurance. Based on Online independent research by Consumer Intelligence 01 July - 30 September 2016; 51% of customers could save up to £286.44 on their car insurance
Avoid hot hatches and big engines
Young drivers’ insurance premiums will be more affordable if they drive a standard car with a small engine (under 1000cc) and in low insurance group. It may not be their dream car but it’s wise to drive something smaller and slower until they’ve built up some no claims bonus and have shown insurers they can drive safely.
Consider a Telematics policy
27% of the parents in our survey said their child took out a telematics (or ‘black box’) style car insurance policy. A telematics policy is where a GPS-enabled device is fitted to the car which sends information back to the insurer about driving behaviour. Different types of telematics policies use this information to price their premiums accordingly, for example, some policies will price their premiums based on the number of miles driven or the time of day the car is used most and others will price their premiums based on driving style, rewarding safe drivers with lower premiums. Telematics policies can help young drivers accumulate no claim discounts more quickly as they can show they are safe drivers from day one.
Opt for a higher excess
Opting for a higher voluntary excess could help lower your insurance premiums but you will need to decide if paying a slightly lower premium is worth the risk of having to contribute more towards the cost of a claim if you have to make one. However, younger drivers may be more inclined to drive carefully if they know they’ll have to contribute £1000 to the cost of a claim rather than £250.
Buy in advance
Surprisingly, even when you buy your policy can affect how much you pay. Some insurers may view people who purchase insurance further in advance as more risk averse and therefore less likely to take a chance behind the wheel or miss payments. This means that purchasing your cover ahead of time and not leaving it until the last minute can cut the cost.
*Based on a 17-year-old student living at home in Cardiff and driving a 1L Corsa, 2008. Difference calculated by comparing the average of the top 10 cheapest premiums returned.
Potential saving: £93
Matt Oliver, car insurance spokesperson at Gocompare.com commented; “Insurance premiums for new, inexperienced drivers can seem high and people are often surprised at how much they are compared to the value of the car they're insuring. Unfortunately, according to the ABI, drivers aged 17-to-20 are twice as likely to make an insurance claim as other drivers and their claims costs will be up to three times higher. As insurance premiums are based on risk, these figures mean that the large insurance costs young drivers face aren’t going away any time soon.
"Although it's understandable that a parent would want to help their child with the cost of getting on the road, it’s important to remember that fronting is a form of insurance fraud. Insurers always investigate claims thoroughly, which means a good chance that any dishonesty. Fronting can have serious consequences such as the claim being rejected or invalidating the policy, leaving the driver to foot the bill. Worst still, as insurance fraud is illegal there can even be serious legal consequences, as well as seriously hampering your ability to get insurance in the future. The long-term implications of being caught fronting mean it’s really not worth the risk.”
“There are legal ways young drivers can try to keep the cost of their premiums down and the tips we’ve outlined, together with shopping around at the outset and at their policy renewal, should help them find the right policy for their needs at the best possible price.”