Coming of age is a rite of passage fraught with both excitement and nerves. There’s newfound freedom, but also the sudden realization of personal responsibility — things that were automatically taken care of before may not be anymore, from laundry to weekly grocery shopping to car insurance.
If you’re still on your parents’ car insurance plan, no judgement. But there comes a time when it might make sense to go off on your own.
For answers to questions you might have about how to come off your parents’ car insurance, we asked John Donovan, insurance sales manager at AAA Northeast, to walk us through the process. The following responses are in his words.
What should both parents and young adults know about transitioning insurances? What does the process look like?
The process always begins with a call or visit to your insurance agent; the child should be present. The agent will discuss the changes to the parents’ policy and provide the child with information on their new policy. Once the new insurance is in place for the child, they will be required to register their vehicle in their name.
When is the best time for teens to move to their own car insurance policy?
There is no best time. It’s more about the right timing. Typically, parents are looking to have a child come off their insurance to reduce their own cost and liability exposure. Often, the cost for a teen insuring a vehicle on their own will be higher in the first few years. This increased cost is often a major deciding factor on whether it makes sense for a teen driver to obtain their own insurance.
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Have insurance questions? Listen to Episode 3 of our podcast, Merging Into Life: Insurance 101.
Tune InIs there an age limit for staying on a parent’s policy?
There is no age limit for a child to remain on their parent’s auto policy, but a child will need to come off their parent’s policy when they buy (or lease) a vehicle in their own name. Often insurers will also require a child to be removed from their parent’s policy when the child moves to a different permanent address.
What ultimately changes once someone has transitioned off their parent’s policy?
The child now assumes liability as the “named insured” on the policy, as well as bearing the financial responsibility for the policy’s cost. Often, the cost for a teen insuring a vehicle on their own will be higher in the first few years. This increased cost is often a major deciding factor on whether it makes sense for a teen driver to obtain their own insurance.
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Have more insurance questions? Check out our Ask an Insurance Agent series.
Based in Rhode Island, Sarah has been a copywriter and content producer with AAA Northeast since 2021. When she’s not scouring the best spots for all things food and drink or whipping up her own versions of tasty meals, you can often find her in the garden, planning her next trip or sipping on (another) hot coffee.
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