Is it true that the auto insurance industry automatically includes
all household family members over the age of 15 as potential future
drivers and adds them to your policy? Could I be made to pay
car insurance on my teen even if he doesn't have a driver's license
and may never obtain a license while living in our home?
No. Auto insurance companies will not charge you for an unlicensed
Underwriting guidelines and rating systems vary from one insurer
to another and are governed by state law, but, in general, car
insurance providers will require that you disclose all
that are over a certain age (15 years of age or older is the norm),
regardless if they have a driver's license.
An auto insurer wants to be aware of the risk it is taking on,
and part of that is being told about household members of driving
age, whether that is a 16-year-old child or an 80-year-old relative
who lives with you, and then the status of their licenses.
Who can drive your car
If your car insurance company requires that you list your
teenager on the policy, but he hasn't received a permit or license
yet, he normally can be marked as unlicensed and should be unrated
by the auto insurance company.
By being classified as unrated, you teen shouldn't affect your
auto insurance rates
. The insurance company may check in with you at renewals to
see if the teenager has received his permit or license yet.
If he still hasn't started the licensing process, then tell your
insurer and he should remain unrated, even if he remains in your
home well into his 20s or even 30s.
If your teen, however, does decide he wants to be licensed, then
you will have to notify your car insurer of this. Many
insurance companies won't require you to add a teen with just a
permit, but others do. When he is past his permit stage, all
auto insurance providers will require him to be listed as a driver
and your auto premiums will increase to cover him. (See "
A parent' guide to insuring a teen driver
If your child does get licensed and continues to live at home,
but you won't let him drive your cars and don't want to pay for
auto insurance for him, then see if you can exclude your young
driver from the auto policy.
Excluding a driver isn't allowed in all states, or by all
insurers, but when it is permitted it means that by signing a named
driver exclusion for a certain individual you won't pay for that
person to be part of your policy. In return, if he did drive your
car, there would be no coverage extended to him if there was an
Just remember, when you are shopping for cheap car insurance for
your family you need to be honest about who lives in your
household. Failure to disclose a household resident --
licensed or not -- could result in the car insurance company being
able to deny claims based on your misrepresentation.
Rating systems vary from one insurer to the next, so whether
your child is licensed or not, shop around to find the best rates.
A little time spent comparison shopping can save you hundreds, if
not thousands, on your auto insurance premium.