Car Insurance fronting, and what is it?
Car insurance fronting, what is that you may ask?
When your children reach the age when they’ve started driving, you will know only too well how expensive car insurance for young motorists can be. And, as a parent, the instinct will be to do what you can to help.
Motorists between the ages of 17 and 22 can expect to pay upwards of £1,000 for comprehensive cover even on a cheap costing car, more than double the average price. Some pay much more than that, because of the insurance claims which show young people are involved in a large number of accidents.
The result is that many young people simply cannot afford the high premiums being quoted. This situation has resulted in the rise of a practice known as fronting, where a more experienced driver who is not the main driver of a car takes out insurance and adds the youngster onto the policy.
This can save money but it can cause big strife for all concerned. Here’s why…
What is Car Insurance fronting?
Car insurance fronting is when an older, more experienced driver falsely insures a car in their own name. Although, the main driver is a son or daughter classed as the riskier driver.
Say, for instance, your son or daughter is heading off to university and is taking the family car. A policy in their name is pricey, so you decide to put yourself forward as the main driver, adding your child as an additional named driver. The premium is now more reasonable, so everyone is happy. Well not everyone as you are misleading the insurance company.
Fronting is often well meaning and can lead to lower premiums. But the practice is also illegal and could end up costing you dear. And it doesn’t matter if the fronting is deliberate or not. If you are caught out then you could be punished and prosecuted if found guilty. Evolve Driving School was featured in a BBC business news story here on car insurance fronting. Tom Dunn was quoted £4000 for his first car insurance whilst leading up to his driving test with us.
When Making a claim
The issue usually comes to light if you make a claim on your policy. For example, if your child is involved in an accident, the insurance company would no doubt investigate. It could then discover that your son or daughter is in fact, the main driver of the vehicle, even though he or she is named only as an additional driver.
They would look into where the accident took place such as a university city, miles away from your home, but where your child is studying for instance.
Insurers take a dim view of fronting and can come down hard on both you and your child. The company could, for example, refuse to pay for any damage to your car. If there was anyone else involved in the accident, the firm would be legally obliged to pay out any claim successfully brought by a third party, but it could then pursue you to recover the costs.
Insurance companies could cancel the policy and the penalties for driving without insurance can be harsh. An uninsured driver can expect a fine, points on their licence and even a driving ban. They will have to pay more for car insurance in the future if found guilty of fronting and higher insurance premiums in the future.
Insurers bump up the cost of cover after refusal or cancellation of policies caused by fronting. A driver caught doing car insurance fronting have to pay bigger financial penalties.
Prosecution for fraud could end with having a criminal record. Of course, branded a criminal is not what you would want, not least because criminals don’t usually find it easy to arrange insurance at any price. They also have difficulty accessing other financial products, including mortgages and credit cards.
However well intentioned, fronting is a bad idea with serious consequences. But how do you know if you are guilty of fronting? It’s not always clear who is the main driver, especially if several people use the vehicle.
You should always be down as the main driver if you regularly drive the car. If you drive the car every day, or if you are responsible for the maintenance of the car. The insurance company should ask relevant questions on your application form. Insurance staff are trained to look out for potential fronting types. But if you are in any doubt, ask. It can save a whole lot of time, trouble, and cash further down the line.
Talking about saving money, there are other ways to cut the cost of insurance cover for young drivers. Parents, for example, add themselves as a ‘named’ driver to a child’s policy. Discounts applied by insurers are on the experience of the named driver being the main driver.
Consider telematics insurance, sometimes know as a “black box.” Telematics is a GPS-enabled tracker fitted to the car, allowing the insurer to record how the car performs.
The system sounds a bit sinister but can often bring down the cost of cover. This will apply if the driver demonstrates sensible driving skills and agrees to avoid driving at riskier times.
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