Car insurance: Are you breaking the law?

With car insurance premiums soaring, particularly for younger drivers, an increasing number of parents are insuring their son or daughter’s car in their name adding their child as a named driver. While this can reduce the cost of cover, it’s illegal and could result in the policy being invalidated.

One in ten British motorists are risking penalty points on their licence or even a complete driving ban by ‘fronting’ on their car insurance policy.

Research by moneysupermarket.com has found that although almost half of those questioned (45 per cent) know that ‘fronting’ is illegal, over a fifth (21 per cent) admit that they would consider it if it saved them money on their car insurance.

What is ‘fronting’?

In car insurance terms, ‘fronting’ is the practice of the main driver of a vehicle falsely informing an insurer that another person is the main driver in order to secure a cheaper premium.

For example, current estimates put the average price of a motor insurance policy for 17-25 year-olds at £1,271.50 and so, in order to bring the price down, some parents will fraudulently claim to be the main driver of their child’s vehicle.

Although this will usually bring down the cost of a policy, it is actually illegal and will be classified as fraud by insurers.

What are the consequences?

If you are found guilty of ‘fronting’ your insurer will treat this as motor insurance fraud, in much the same way as if you did not declare any accidents or convictions when taking out a policy.

This can lead to you having to pay the correct premium price in one lump sum and can also result in the cancellation of your policy, which is something that can cause problems when trying to take out car insurance in the future.

In some instances ‘fronting’ is looked upon as driving without insurance, as Peter Harrison, car insurance expert at moneysupermarket.com, explains: “Any motorist falsely claiming to be the main driver of a vehicle is committing fraud, and taking a serious risk. Despite the attraction of saving money in the short term there will be serious repercussions if they were caught as their insurance will be invalidated. Further ramifications could result in a younger driver ending up in court being charged with driving without insurance.”

Driving without insurance is an offence that carries a minimum penalty of a fine and six penalty points on your licence. For new drivers this would automatically lead to a complete driving ban.

In addition, your vehicle can be impounded and you will be liable for the cost of removal and daily storage costs.

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Why do people do it?

Many people will consider ‘fronting’ to simply save money on their car insurance but there also appears to be a certain degree of confusion involved as 55 per cent of drivers do not realise that it is illegal.

Furthermore, 19 per cent of those questioned think that it is actually legal whilst 36 per cent are completely clueless about it.

How can young drivers cut insurance costs?

Although car insurance for young drivers can be very expensive, the cost of being caught carries a far higher premium and so it’s worth looking at other ways to cut the costs.

One way to reduce the price of your policy is to simply shop around and people who use moneysupermarket.com to compare prices save an average of £282.

In addition, it is also worth paying for your car insurance in one annual lump sum as paying via monthly instalments will incur interest charges and work out more expensive.

If you are a young driver then you should also think about the type of car that you drive and try to avoid those with larger engines or modifications as either of these factors can bump up the price of your premium.

It may also be worth taking a ‘Pass Plus’ driving course, which gives new drivers specific lessons in night, motorway and town traffic driving, as this can earn you a discount of up to 35 per cent.

Other things to consider are fitting your car with an insurer approved alarm and immobiliser and limiting the number of miles you travel each year as these are both simple ways to reduce insurance costs.

And, although ‘fronting’ is illegal, there is nothing wrong with adding a parent as a named driver and you can bring down the price of your policy by simply adding a someone with more experience as a named driver.

Please note: Any rates or deals mentioned in this article were available at the time of writing.

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