What happens if I don’t add my child to my auto insurance?

If you’re the parent of a teen driver, you might consider leaving them off your insurance to save money. However, failing to list your child on your policy can be a costly error, leading you to major financial issues if there’s an accident. 

“Unfortunately, the risks are severe,” said Kris Barber, principal attorney at the Barber Law Firm, a law firm in Texas specializing in insurance law. Your insurance company can deny coverage entirely if they discover an unlisted household driver was involved in an accident.

Although requirements vary by location and insurer, you typically have to list all licensed drivers in your household on your policy. There are some exceptions to this rule, but usually, failing to add a child to your auto policy can be a big mistake. 

Do you need to add your child to your auto insurance?

In most cases, your insurance company will require you to add any licensed drivers — including teen drivers — to your auto insurance policy. Insurers have these requirements so they have all the critical information to assess risk, and unlisted drivers are a liability. Teens are statistically more likely to be in accidents than other drivers, so insurance companies need to know if a teen will get behind the wheel when setting your rates. 

In divorced households where the child may drive vehicles at each parent’s home, both parents must add the teen driver to their car insurance policies. 

Even if your child is away at college or rarely drives your car, you must usually list them on your policy to avoid coverage issues during a claim. 

It’s best to clarify with your insurance agent if your child needs to be listed on your policy or if they can be left off. 

There are some exceptions:

• Your child has their own insurance policy and can provide proof of coverage.
• Your home isn’t their primary residence. 

What happens if you don’t add your child to your auto insurance?

If you leave your child off your policy, you risk coverage disputes, claims denials, and policy violations. 

These are some of the biggest consequences and penalties for not listing a driver: 

• Claim denial: If your teen borrows your car and is in an accident with another driver, the insurer could deny the claim. As the parent and car owner, you would be legally responsible for the damages, repairs, and medical expenses, leaving you with significant legal bills and out-of-pocket costs. 
• Higher premiums: If your insurer decides to cover the accident your teen was involved in, they may increase your premiums to reflect the higher risk. 
• Policy loss: Since leaving off a teen driver technically breaks your policy rules, your insurer may cancel your policy altogether, and you’ll have to purchase insurance from another provider.  

How much does it cost to add a child to your car insurance policy?

First, the bad news: Adding a teen driver to your insurance policy can be expensive. On average, we found that it costs about $3,594 per year to add a teen driver to an existing policy. 

However, it is cheaper than an individual policy; on average, a standalone policy for a teen driver costs $5,616 per year — 56% higher than adding a teen to your policy. 

That said, most teens can’t legally purchase their own policy until they’re 18, meaning a parent or guardian typically must list them on an existing policy or co-sign for minors.

Other factors do affect your rates, such as your location, your child’s age and gender, the make and model of your car, and which coverage options you choose. Your child may be able to help with the cost by qualifying for discounts like good student discounts for maintaining strong grades or a safe driving discount for completing an approved driving course.

Weighing the risks: Adding your child vs. leaving them off your policy

Not convinced to add a child to your policy? See what’s at stake when you add or don’t add your teen to your policy.

Although adding a teen driver to your policy can be pricey, the financial risk of an accident or lawsuit if they’re involved in a crash and aren’t adequately insured can be far more costly. Without coverage, you could be held personally responsible for damages, medical bills, or legal fees  —  expenses that can quickly exceed any savings from lower premiums.

“The few hundred dollars you might save by not properly covering a teen driver pales in comparison to the potential million-dollar liability you could face in a serious accident,” says Barber. 

How to add your child to your auto insurance

Adding a child to your insurance policy is a simple process. If you want to keep your current coverage and provider, follow these steps to add a teen driver to your insurance policy: 

1. Contact your insurance company. Depending on your company, you may be able to add a driver online, or you may have to call customer support or contact your local agent. 
2. Provide your child’s information. Explain that you want to add a child to your policy, and provide your kid’s information, such as their name, license number, and birth date. 
3. Add vehicle details. Explain which car your child will typically drive, or, if you’re buying your teen a new or used vehicle, what the make and model of the car are. 
4. Adjust your coverage limits. With a teen driver, you may want to adjust your coverage, such as increasing your liability limits, to protect you and your family. 
5. Ask about discounts. If your child is a good student or is willing to take a safe driving course, ask about potential discount programs you can use to lower your premiums.

How to remove your child from your auto insurance

It may be time to remove your child from your policy if they move out permanently, purchase their own insurance, or lose their license. To remove them (and potentially qualify for a premium reduction), contact your insurer and let them know your child no longer needs to be listed. If your child has purchased their own coverage — which they can do once they turn 18 — be prepared to provide proof of their new policy.

Only remove your child once you’ve confirmed their new policy is active to avoid any gaps in coverage.

While adding a teen to your policy can be expensive, the benefits can outweigh the cost, protecting you and your child.