We get this question from parents of young (and not so young!) adults all the time. Here's a clear set of answers based on common life situations.
What factors matter if I'm taking my kid off our car insurance policy?
There are a few aspects of how and when your kid drives and where they live that matter:
- Do they own a car?
- Is your home their permanent address?
- How often do they drive your car?
The answers to these questions determine whether you keep your kid on your car insurance, or take them off and save yourself some cash.
(Just to be clear, we're talking about your personal car insurance policy here, not any commercial policies you have if you have a family business. That's more complicated, and you should talk to your agent or insurance company.)
Here's whether you should keep your son or daughter on your car insurance policy or not, by life situation
Your kid owns their own car
Regardless of where they live, car owners need an insurance policy in their own name. And yes, you can have multiple auto insurance policies at the same address.
If you live together, you will want to make sure that your car insurance company knows your kid lives in your household and that they have their own car and their own insurance. You shouldn't get charged for an extra driver on your policy, but that way you should be all set if your kid borrows your car in an emergency and gets in a crash.
The exception to this is if your kid regularly drives your car instead of their own. In this case, make sure your insurance company knows and that you understand what coverage your policy offers if your son or daughter is driving.
Your kid doesn't own a car and your home is their permanent address
In this case, you need to leave your son or daughter on your policy if they ever drive your car (like, ever, even in an emergency). If they are living away from home temporarily, like in a dorm, or on deployment, check with your insurance company. There may be a discount available for these situations.
If your kid truly never, ever drives your vehicle, you can exclude them from your policy. This means they are listed on your policy, but excluded from the price, and there is no coverage at all if they drive. Be wary of this option: if they jump behind the wheel in a medical emergency and get in a crash, still no coverage at all.
Your kid doesn't live with you, but they regularly drive your car
If they borrow your car to drive to an activity a couple times a week, or to volunteer every Saturday, or they drive you to the grocery store on the weekends, that's regular use. Keep them listed regardless of where they live.
And, in fact, always make sure anyone who regularly drives your car is listed on your policy so there's coverage if they crash.
Your kid doesn't live with you, but they occasionally drive your car
They drive when they visit once a year, or they borrow your car one day when their car is in the shop - that's occasional use. Car insurance policies are set up to cover occasional use by drivers who have a valid license, have permission to use the car, and aren't otherwise excluded.
No need to keep them listed on your policy.
Your kid doesn't live with you and they don't regularly drive your car, but you want them to be covered if they borrow or rent a car
This is the stickiest one we see. People who don't have their own car insurance need to be extra careful to make sure they are covered when they borrow or rent a car. However, if your kid doesn't live with you and doesn't regularly drive your car, they actually should not be on your policy. You may have issues with coverage if they get in a crash in someone else's car and file a claim on your policy.
The responsible solution in these policies is for them to get a non owner auto policy (also called a named non owner policy) to cover them as a driver. These policies usually cost about 1/3 of regular car insurance. They cover the driver's liability for an accident but don't cover the car they are driving. See our overview of non owned auto insurance if you'd like to learn more.