Car insurance in parent's name a good idea?
Imagine this: you just got your driver's license, you buy a car and then want to get car insurance.
When you take out the insurance, you see that the cost is quite high per month. Some people therefore choose to put the car insurance in the name of their parents. This is because the insurance may then become cheaper. Will the insurance actually become cheaper and is it wise to do this?
Why is insurance in parents' names attractive?
Insuring in your parents' name is mainly more financially attractive. Insurers see young adults aged 18 to 25 as an increased risk. According to insurers, young people around that age drive more frequently than experienced drivers. As a result, they also pay a higher premium. Another reason is that young people have no, or fewer, claim-free years. By building up claim-free years, you get a discount on your car insurance. Both arguments could be a reason to put car insurance in parents' names, but what are the consequences?
Are there any consequences if I insure in my parents' name?
There can be several consequences when a person puts car insurance in the parents' name. When applying for insurance, the insurance company asks for the license plate holder and the regular driver(s) of the car. These must agree match. So if you actually drive the car all the time, but the parents are specified as the regular driver, this does not match. A regular driver is the person who uses the car the most. So when you borrow the car from your parents, word you are not directly considered a regular driver. When you actually use the car all the time and your parents (almost) never drive it, you are a regular driver. If the insurance is not in your name, but in the name of your parents, it is insurance fraud. It is mandatory to put the insurance in the name of the person who uses the car regularly.
What is a CIS registration?
When the insurance company finds out that the car insurance is in the name of the parents instead of the person driving the car, the insurance company can stop the insurance. The car is then no longer insured. In addition, the insurance company may issue a fine if it is found that the regular driver and the policyholder are not the same person. In addition, you may be registered by the insurance company with Stichting CIS. Foundation CIS stands for Foundation Central Information System. Insurance companies can consult CIS to collect, store and exchange information about their customers.
When you apply for insurance or file a claim, the insurer may check with CIS. What the insurer does with this information varies by case and company. Usually, with a CIS registration you will not be accepted by a regular company.
Building up claim-free years is possible?
In addition, it can also have disadvantages for your own claim-free years. When the car insurance is in the name of your parents, you do not build up any claim-free years. As a result, you are not entitled to a discount on your car insurance.
Can you get car insurance for a child?
Is it convenient to put car insurance in your parents' name? It can save money, but it can also cost a lot of money when the insurance company figures out that there is insurance fraud. Also, you don't build up your own claim-free years. So it is wise to put the car insurance in your own name. That way, you build up your own claim-free years and do not run the risk of a CIS registration.
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