As any young driver will testify, the cost of car insurance can be expensive. This is because providers view younger drivers as high risk, and often inflate premiums to reflect this. But while the prospect of having to pay sky-high prices may prompt you to consider going without insurance, this is simply not an option, as if you own a vehicle, car cover is a legal requirement. Plus, if you get caught driving uninsured, you could face some pretty hefty penalties.
Beware of fronting
As a young motorist, it’s only natural that your parents will want to help get you on the road, but you need to beware of committing a type of insurance fraud known as “fronting.” This is where the parent insures the car in their name – implying that they are the main driver – and adds their son or daughter as the second named driver, when in fact the young “second” driver is actually the main driver, and not the occasional driver.
Fronting is fraud
Some people may see fronting as a “harmless” way of reducing their premium, but it’s not – and is taken very seriously by insurers. Equally, while well-meaning parents may have done it unintentionally, there is no escaping the fact that this seemingly innocent practice is illegal.
Mike Pickard, head of risk and underwriting at Esure Car Insurance, said: “Despite many people thinking this is a legitimate way of massaging premiums down with a few white lies, fronting is fraud.”
“The simple rule is that if you’re deliberately trying to give your insurer the impression of a very safe set of circumstances when you know that the truth is different, you are probably fronting.”
Facing the consequences
If you do get caught, the insurer has the right to cancel the policy or charge the correct premium as a lump sum.
Drivers who have had a policy cancelled will then have to declare this on any future applications, and will find it harder and more costly to buy new cover, as the majority of insurance providers may refuse to cover them.
They can also refuse to pay out for any claim you make which means you could be treated as uninsured. You could also find yourself being slapped with a fine, conviction, a minimum of six penalty points and you may even lose your licence.
Further, the insurance industry use various databases to share information so a black mark may be made on any files held on you, and this too could make it harder to obtain insurance in the future.
Drive down the cost of cover
You may find it difficult to get a competitively-priced policy as a younger driver, but there are some simple steps you can take to reduce costs:
• Get discounts on your premium by taking extra safety precautions such as parking your car in a garage at night, and fitting an alarm and immobiliser.
• Choose a car with a smaller engine, as bigger and faster vehicles cost more to insure.
• Avoid vehicles with any modifications from the standard manufacture.
• Make savings by reducing your mileage or by only driving at certain hours of the day.
• Take the Pass Plus qualification (www.passplus.org.uk) to benefit from a reduction of up to a third on your premium.
• Consider lowering the price you pay by opting for a higher excess – but be sure you can still afford this amount in the event of a claim.
• Shop around to ensure you are getting the best possible deal.
Honesty is the best policy
When applying for any type of insurance, it’s important to understand that a policy is a contract based on trust between the customer and insurer.You need to ensure you tell the whole truth, and inform the insurance provider of anything that could influence their decision in offering cover. And remember, non-disclosure of information – whether intentional or not – may have an impact on any future claim.