How Long Can a Child Stay on Their Parents Car Insurance?

Part of growing up is paying bills. No one wants to pay bills. The more steps you take to full-fledged adulthood – getting a job, getting a car, getting a place – the more bills you have to pay.

Naturally, you’d jump at any chance to save some money. Since young adults have been covered under their parents’ car insurance their whole lives, they might be wondering how long that can last.

We’ll go over everything you need to know about children staying on their parents’ car insurance, including when and why you need to get your own policy when the time comes.

A child can stay on their parents’ car insurance indefinitely, as long as the child’s address is the same as the parents. In other words, you can stay on your parents’ car insurance as long as you live with them — regardless of age.

Unlike health insurance, when you get cut off from your parents’ plan at age 26, there’s no age limit for car insurance. You just need to live in the same household as them to stay on their policy.

Here are four basic scenarios that illustrate whether you should be on your parents’ car insurance or not:

1. You live with your parents and you drive cars they own

You don’t own a car yet. This is common for most teens and young adults before or just after they get their first jobs, or they’re attending school full time. In this case, you should be on your parents’ car insurance. Your parents will add all vehicles they own to their policy, which includes the one you drive.

Although this is typical for teens and young adults, you can be on your parents’ car insurance no matter what age you are if this is your situation.

Also, if you attend college and live at home full time or part-time (like coming home for holiday breaks), you’ll still usually be eligible for coverage under your parents’ plan. You’ll still be driving cars your parents own and insure, and your permanent address is still the policyholder’s (your parents’) household.

2. You live with your parents, but you own and drive your own car

If you own your car, you typically need to get your own auto insurance policy. In addition to you living with them, your parents have to own the car you’re driving to add you to their coverage. Your parents’ provider won’t cover a car your parents don’t own. 

However, you should be listed as a driver on your parents’ car insurance, and they should be listed as drivers on yours if you all live in the same house. 

When getting auto insurance, providers typically ask for all drivers in the policyholder’s household to be listed on the policy. Members of households typically drive each others’ cars at least semi-regularly if not often. The insurer needs to know about all people who will normally be driving the insured car to fully understand the risk involved in covering the policyholder.

All insurance companies, including auto insurers, determine premiums by calculating risk. Two of the most important factors in determining car insurance risk are the age and number of people driving the insured vehicle. 

While carriers typically cover someone borrowing your car now and then, called permissive use, they need to know who will be driving the car regularly to fully understand the risk involved of covering you and your vehicle, which affects how much they charge you for coverage.

3. You don’t live with your parents, but you drive a car they own

This is a tricky situation, and it can vary depending on your provider and your financial independence overall. Some insurers won’t allow you to be on your parents’ policy if you demonstrate financial independence. 

For example, let’s say you live by yourself in a second property your parents own, and you still drive a car they own. Carriers may consider you still financially dependent on your parents, and you shouldn’t have an issue staying on their insurance even though you’re not in the same household. Your parents, the policyholders, own the vehicle, and you’re dependent on them, so you have their coverage.

But, let’s say you live in a place you own, but your parents are listed as owners of the car you drive. You’ll probably need to get your own auto policy. Talk to your insurer about the specifics of the situation, but your parents’ carrier likely won’t want to cover a vehicle your parents don’t drive, or ever see, because you don’t live with them. Your insurer may urge your parents to put the title of your vehicle in your name and then ask you to get your own plan.

Furthermore, it might even be cheaper for you and your parents to have different car insurance policies in this case, depending on your age. Having fewer drivers on their policy will reduce your parents’ rates. And, if you have a clean driving record and are around the age of 25, your risk is much lower than when you were a teenager, and you should be able to find affordable car insurance on your own.

4. You don’t live with your parents, and you own and drive your own car

In this case, you’re essentially financially independent. You’ll typically need your own car insurance. We’ll elaborate more below.

If you’re independent of your parents, meaning you live in your own place and pay your bills, you’ll need to get your own car insurance. Providers only allow you to stay on your parents’ car insurance if you’re still their dependent. Moving out is a large step towards financial independence.

What a carrier considers dependent varies by company, but if you have a permanent address separate from your parents’ home, you’ll likely need your own auto policy. If you bought the home (and your own car), insurers would consider you financially independent and expect you to get your own coverage. 

There are no specific auto plans that parents can buy designed for children who don’t live with them.

Some scenarios may allow you to stay on your parents’ car insurance after you move out, like the ones we mentioned earlier. But, for the most part, you’ll need to look into getting your own policy. 

While your provider doesn’t always know when you move out of your parents’ house, you shouldn’t attempt to stay on your parents’ car insurance after moving out without consulting your insurer. If you submit a claim, the carrier will find out whether you live at your own place or not given the context of the damage and the adjuster’s findings. 

Your claim could be denied if you don’t live in the policyholder’s (your parents) house, and the provider may debate canceling your parents’ coverage altogether. It’s not worth it to jeopardize your family’s auto insurance, especially when there are so many options out there for affordable coverage.

If you’re living with your parents after marriage, you should be listed on their insurance policy since you’ll be in the same household. But, you’ll need to get your own policy if you or your spouse own a car. You might need to get your own coverage even if you’re still driving your parents’ cars, too. Double-check with your carrier.

Marriage is often a sign of financial independence. Insurers will usually expect a couple to get their own auto insurance. At that point, it might even be more cost-effective for both parties, the married couple and the parents, to get separate policies. Having so many drivers on a parents’ plan would hike up rates a lot, given the insurer would allow it.

If you’re married and the car you use is in your parents’ name that you don’t live with, you should look to get added to the title so you can get your own insurance on the vehicle.

Of course, if you or your spouse buy a vehicle, you’d need coverage in your name for that car.