We've titled our 18+ YO kids' cars over to them, and gotten them their own insurance policies, to reduce our liability exposure. So we have three Geico policies in the household. Now we're thinking of switching from Geico, after 28 years, because of their present claim-handling procedures. Would there be any problem if we switch and the kids don't, or if we all switch to different carriers? Related question: If they drive one of our cars, or we drive one of their cars (we only do this on occasion), is the driver's policy or the vehicle owner's policy primary?
Multiple Auto Carriers in One Household
- Thread starter x475aws
- Start date
It's a little more complicated than the question you are asking.
In short, at least in California (and most states), the vehicle owners policy is always primary. I don't know specifically about Maryland though. All this means is you have to read the policy very carefully.
If you came to me with this situation, most carriers either rate or exclude other drivers in the household. They don't like 'other insurance' since there is no way to really monitor this. What this means is you can drive your cars, the kids can drive their cars, but not drive each others cars., you would be excluded from coverage.
Even if coverage is extended under permissive user rules, frequently carriers will reduce the liability coverage to state minimums for permissive drivers (check state rules on this, it will vary). This could leave you with minimal coverage, if you even have coverage.
You really need to talk to a Maryland agent to answer this question. The answer might even vary based on the carrier. I have done similar things with clients in the past, but its easier when the kids move out of the house.
Dan
In short, at least in California (and most states), the vehicle owners policy is always primary. I don't know specifically about Maryland though. All this means is you have to read the policy very carefully.
If you came to me with this situation, most carriers either rate or exclude other drivers in the household. They don't like 'other insurance' since there is no way to really monitor this. What this means is you can drive your cars, the kids can drive their cars, but not drive each others cars., you would be excluded from coverage.
Even if coverage is extended under permissive user rules, frequently carriers will reduce the liability coverage to state minimums for permissive drivers (check state rules on this, it will vary). This could leave you with minimal coverage, if you even have coverage.
You really need to talk to a Maryland agent to answer this question. The answer might even vary based on the carrier. I have done similar things with clients in the past, but its easier when the kids move out of the house.
Dan
- 191
Also, you might see if it would be cheaper for them to have a policy with the same carrier you are considering going with. Some of our carriers let us stack discounts for childrens policies (home/auto/mult. vehicle). It usually is cheaper as well
- Thread starter
- #4
Hmm, would any exclusions be listed in plain English along with the coverages? I don't see any on my present Geico policy papers, at least.
Say my son was excluded from my policy, and he got into an at-fault accident in my car. If he has full coverage on his car, would the accident in my car be covered under his policy?
Say my son was excluded from my policy, and he got into an at-fault accident in my car. If he has full coverage on his car, would the accident in my car be covered under his policy?
A little off topic, but I would just like to add, I see this a lot where the parents want to reduce exposure, and put vehicles in kids names and the kids get their own policy. this will limit exposure, but it definitely is not getting rid of the exposure. A lawyer will still go after you and your policy if you provide support for the child in anyway. Which is why I don't recommend it.
I say this confidently because it happened to a good friend of mine several years ago. He was 19 and living at home, had his own job and paid everything himself (including the vehicle), except rent, parents let him live at home while he attended college. He only had 25/50, parents had 250/500. He was involved in a serious accident where the other driver needed extensive medical attention. His policy maxed out very quickly. The other driver sued him and his parents. His parents policy was with the same carrier and same agent, but the agent told the parents that since the son doesn't have any assets he didn't need much coverage. So once the sons policy maxed out, they went after mom and dads policy. The carrier denied the claim. Parents had to get their own lawyer to represent them in the lawsuit. In the end, they lucked out because there ended up being a third vehicle involved with higher limits and that driver was drinking (and I believe fled the scene), so they went after him once they located him, but it cost my friends parents thousands to hire the lawyer.
With that being said, you do have to insure the vehicles the way they are titled (at least with the carriers I represent), so I guess what I'm getting at, make sure you have high limits of liability even on the kids policies and a personal umbrella policy is highly recommended when young drivers live in the household.
I say this confidently because it happened to a good friend of mine several years ago. He was 19 and living at home, had his own job and paid everything himself (including the vehicle), except rent, parents let him live at home while he attended college. He only had 25/50, parents had 250/500. He was involved in a serious accident where the other driver needed extensive medical attention. His policy maxed out very quickly. The other driver sued him and his parents. His parents policy was with the same carrier and same agent, but the agent told the parents that since the son doesn't have any assets he didn't need much coverage. So once the sons policy maxed out, they went after mom and dads policy. The carrier denied the claim. Parents had to get their own lawyer to represent them in the lawsuit. In the end, they lucked out because there ended up being a third vehicle involved with higher limits and that driver was drinking (and I believe fled the scene), so they went after him once they located him, but it cost my friends parents thousands to hire the lawyer.
With that being said, you do have to insure the vehicles the way they are titled (at least with the carriers I represent), so I guess what I'm getting at, make sure you have high limits of liability even on the kids policies and a personal umbrella policy is highly recommended when young drivers live in the household.
- 1,473
JoshB great point.
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JoshB with one of the best arguments I've read for having an umbrella policy.
RW
RW
soonersublime
New Member
- 12
I think without a doubt I would keep the kids on your policy for as long as you are allowed to and reduce exposure with a 2 million dollar umbrella. I believe currently the average judgement for accidental death right now is 1.3 million nationally. 2 mill should cover you for most anything on top of the 250/500 and 300 for the home. I would add it onto my uninsured as well.
Good Luck
Good Luck
Okay, I'll play along. Why would you keep the adult children on the policy? Does this lower or increase your personal liability? Can you back up your claim with actual case law?
I ask, because I've had this discussion a lot. I've even asked attorneys what would really happen, not what 'could' happen. Nobody has been able to point me to a single case where an adult child (over 18) has had an accident that went back to the parents if they were not on the parents policy.
Yes, its better to be safe. As an insurance agent, that is what we do. I'd just like to know if this is a real possibility or not, I have no idea.
I have had attorneys tell me the more separation you get (i.e., put the car in the kids name, own policy, etc), the better off you are. I've no proof that this is true either.
Dan
I ask, because I've had this discussion a lot. I've even asked attorneys what would really happen, not what 'could' happen. Nobody has been able to point me to a single case where an adult child (over 18) has had an accident that went back to the parents if they were not on the parents policy.
Yes, its better to be safe. As an insurance agent, that is what we do. I'd just like to know if this is a real possibility or not, I have no idea.
I have had attorneys tell me the more separation you get (i.e., put the car in the kids name, own policy, etc), the better off you are. I've no proof that this is true either.
Dan
