Question: I own two cars. The car insurance policy lists my 25-year-old son, who lives at home, on the most expensive car. Is this correct? He isn’t the owner and is not on the car’s registration.
Answer: Yes, for many car insurance companies rating the highest-risk driver with the highest-risk vehicle is correct.
In general, insurance companies don’t rate insurance premiums on the number of drivers or only on the person that owns the cars.
Instead, auto insurance underwriting and rating rules, which are approved by the state, normally assign the highest-rated driver (usually the youngest or the one with the most violations) to the highest-rated vehicle (usually the newest or most expensive).
Car insurers then assign the next highest-rated driver to the next highest-rated car, and so on, if you have more drivers and vehicles in your household. It doesn’t matter if you own all the cars listed on the policy, the other drivers on your car insurance policy can still be rated and listed on your vehicles since they will be operating them.
While it may make more sense to you for car insurers to rate the driver with the actual car they drive the most, that isn’t how it happens with most insurers. There are a few carriers who will match up each driver to the car they use the most when determining the primary driver of each vehicle. However, this is not the norm.
If your son is rated as your most expensive vehicle, but he will never drive it, you could see if it’s possible to exclude him from that vehicle. Some car insurance companies allow this (also, state laws must allow a named driver exclusion of this type).
If you did an exclusion for your 25-year-old old son on the most expensive car, then he wouldn’t be rated on that vehicle, but he also couldn’t drive it because he would be without auto insurance coverage for it.
With a named driver exclusion like this, he wouldn’t have insurance coverage extended to him if he drove the car he was excluded from since you aren’t paying premiums for him to use that vehicle.
If you think you are paying too much for auto insurance, check car insurance prices to find the best car insurance.
— Michelle Megna contributed to this story.