'Fronting' – not a good example to set
They say that bereavement, marriage and moving house are the three most stressful events in life. Parents would also add that your child learning to drive and then needing his or her own vehicle is another worry. Not only are you worried for their welfare and safety, you often have to foot the bill for driving lessons, that first all-important vehicle - and then the insurance and running costs associated with car ownership. At this point it is tempting to save money in any way you can – you'll need it for the bottle of wine to get you through the evening until you hear the car safely back on the driveway!
However, such is the need to economise that many parents are said to be breaking the law in order to save money on car insurance for their children. New figures suggest that around 41% of parents deliberately lie when filling out insurance policy applications. Parents often claim that they are the main drivers on the policy, when in fact it is one of their children who is the main driver, or owner of the car. This practice is known as 'fronting' and can potentially offer large savings – but it could also lead to prosecution. Despite this, an astonishing 61% of parents have said that they would use this practice in the future.
Insurance companies often discover this deception when a car is perhaps registered to the parents' address in London whilst the car spends most of its life in Loughborough, where the child is studying at university. The industry warns that this is a very risky practice: parents who believe they are helping their children to save money by fronting, are not only risking prosecution but are also harming their chances of obtaining insurance in the future.
It seems that parents are, by and large, fronting without realising that this is an illegal act. Once made aware of this being against the law, they tend to be shocked – especially when it is pointed out to them that the whole insurance policy may be null and void, so that if you cause an injury to a third party you may well have to pick up their costs as well – which could run into hundreds of thousands of pounds.
Whilst it can be argued that insurance premiums for youngsters may be deemed to be expensive, there is really no excuse for breaking the law. Fronting is in effect an attempt to obtain money by deception, and therefore amounts to stealing. It is not just a criminal record that parents could be saddled with - they can find themselves struggling to find affordable insurance ever again.
In order to find a way forward, speak with a professional, qualified insurance company who can advise you on the best way forward. There are ways to save on costs, for example by ensuring the vehicle is kept on a private driveway etc. Talk to someone who can advise you sympathetically about your off-springs' first foray into vehicle ownership – teach them to be honest from the outset. Then you can rest assured they are fully insured for whatever may occur – and you can enjoy that bottle of wine just a little bit more!