Parents risk thousands in potential legal costs
PARENTS who are breaking the law to save money on car insurance for their children are risking the possibility of being landed with life crippling court costs.
An ever increasing number of parents are lying on insurance policy applications and claiming they are the main drivers of cars that are, in fact, used by their offspring.
The practice is called “fronting”, but what many parents do not realise is that it could lead to prosecution.
Nigel Lacy, co-founder of Whittlesey-based Young Marmalade, which sells car and insurance packages specifically for young drivers, said: “If the child has an accident and injures a third party the insurer could refuse cover leaving the parent potentially liable for hundreds of thousands of pounds in costs.”
Parents can be expected to find a staggering £4,000 per year to insure a young driver but, according to Ashton West, of the Motor Insurers’ Bureau, this figure “accurately reflects the risk posed by young drivers”.
Young Marmalade was created to reduce the cost of insurance for young drivers. By combining car purchase and insurance as a package, Young Marmalade uses the benefits of volume to offer youngsters reduced insurance.
“Often we are able to offer our monthly package of car plus insurance at less than the monthly cost of traditional insurance,” said Mr Lacy.
Research conducted by Young Marmalade in association with First Car Magazine discovered that 41.79 per cent of parents were actually fronting policies for their children.