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For Those With Teens Who Drive

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  • For Those With Teens Who Drive

    Does having your child purchase their own auto insurance and titling a car in their name help you (the parent) protect assets in the case of a lawsuit related to them (the child) injuring another person?

  • #2
    how will they buy their own insurance as a minor?

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    • #3
      I pay for it, or perhaps they have a part time job, or money earned from summer. There are multiple ways this could happen. Does the source matter?

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      • #4
        We haven't, but do have an umbrella policy.

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        • #5
          Originally posted by FunkDoc83 View Post
          Does having your child purchase their own auto insurance and titling a car in their name help you (the parent) protect assets in the case of a lawsuit related to them (the child) injuring another person?
          Progressive said that my 15 year old with full license ( except night time driving restriction) was essentially un-insurable unless we include her in our policy.

          Even if we somehow could have had her on her own policy, I have no doubt the opposing lawyer would have found a way to blame us and skin us, if she had an MV accident.


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          • FunkDoc83
            FunkDoc83 commented
            Editing a comment
            Well that settles it, no driving until they turn 18!

        • #6
          This is going to be a state by state question, consult a local attorney.

          Even if they're 18, if they are residing at your home (even just between semesters) there's a decent chance you're going to have to pony up. Again, depends on the laws of your state, the language of your policies, the whim of the court or the jury, etc.

          Regardless it won't hurt to maintain a lot of liability insurance.

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          • Tim
            Tim commented
            Editing a comment
            And that leads to the question would YOUR insurance even cover.

        • #7
          Originally posted by FunkDoc83 View Post
          Does having your child purchase their own auto insurance and titling a car in their name help you (the parent) protect assets in the case of a lawsuit related to them (the child) injuring another person?
          In many states, it defaults to "dependency"...so even if your kid has their own insurance and car title....if your kid qualifies as your dependent based on state law you are still liable as a parent...and for many kids dependency drags out a long time.......

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          • #8
            No. I speak as a former adjuster. A good plaintiff attorney will find a way to bring in the physician with ‘deep pockets’ as a target defendant.

            Many judges and courts frown on behavior to circumnavigate liability. Just carry high enough limits and your insurance will handle it.

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            • G
              G commented
              Editing a comment
              Reassuring comment, thank you!

          • #9
            Originally posted by jbmitt View Post
            No. I speak as a former adjuster. A good plaintiff attorney will find a way to bring in the physician with ‘deep pockets’ as a target defendant.

            Many judges and courts frown on behavior to circumnavigate liability. Just carry high enough limits and your insurance will handle it.
            I understand what you are saying but I think there is a difference between a 16 year old who smashes your car into someone vs a 22 year old who smashes their car into someone.
            I think it is great advice to increase the coverage when you have new teen drivers but when is it safe to decrease it again?

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            • bean1970
              bean1970 commented
              Editing a comment
              this is why many states default to dependency to determine liability...at 22 years if you are paying for their college and housing/food expenses all school year, they live with you in the summer, you pay for their health care premiums under your policy, etc etc. it will be hard pressed to prove in court that you shouldn't be responsible for their actions just because the car title is under the kid. We were advised not to lower our umbrella liability until they are off our health insurance coverage and/or out of higher education (because we as parents are paying).

            • Lordosis
              Lordosis commented
              Editing a comment
              Good to know. I have a lot of years before it becomes an issue but I will keep it in mind

          • #10
            One acronym: PUP. Which stands for three words: Personal Umbrella Policy. This is the best deal you can get when you have teenagers. Or any other family members who might be tempted to text and drive...certainly not limited to teens.
            Our passion is protecting clients and others from predatory advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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            • #11
              Originally posted by Lordosis View Post

              I understand what you are saying but I think there is a difference between a 16 year old who smashes your car into someone vs a 22 year old who smashes their car into someone.
              I think it is great advice to increase the coverage when you have new teen drivers but when is it safe to decrease it again?
              Never.

              When you are a deep pocket, there is always someone who wants your money.

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              • #12
                Can a 15 year old even own a car in your state? If not, I don't think you can be off the title, which means you can't remove liability until they turn 18, you give them the car, and you take your name off the title. It isn't about getting your name off the insurance policy, it's about getting your name off the car. Even if they can own it themselves, you probably will have to sign a consent, which again introduces liability. And even if it were their car and you didn't have to give consent, you're still liable for their actions.

                https://www.carinsurance.com/what-ag...n-own-car.aspx
                Helping those who wear the white coat get a fair shake on Wall Street since 2011

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                • #13
                  Originally posted by Lordosis View Post

                  I understand what you are saying but I think there is a difference between a 16 year old who smashes your car into someone vs a 22 year old who smashes their car into someone.
                  I think it is great advice to increase the coverage when you have new teen drivers but when is it safe to decrease it again?
                  Once they are entirely independent and self sufficient. Otherwise a savvy attorney is looking for negligent entrustment. Essentially that you knew better than to allow the kid to do whatever happened.

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                  • #14
                    I have a 16 yo that is now driving regularly. She is doing a good job so far. But I have to admit that this process has been far and away the most anxiety-provoking experience of parenting so far.

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                    • #15
                      If the child

                      1) owns their own vehicle
                      2) has their own insurance policy
                      3) resides separately from you, and
                      4) is over 18,

                      then you don’t have liability.

                      Our son had accidents and we were under the threat of having our umbrella liability policy cancelled. Since our son qualified for all of the criteria above by having his official address for the insurance established at his university address, our umbrella policy was not cancelled.

                      His auto insurance cost him almost $200/month, but actions and events have consequences. Consequences can offer as much education as paying tuition.

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