Policyholder, Named Driver and NCD . Is this FRONTING?

johnny_c

Car insurance quotes online openly ask WHO is the Policyholder , WHO is the Additional Driver, and WHO retains the NCD.  

FRONTING seems to be described as when you try to 'game ' the system, wherein  the additional driver is in reality the main driver.

However, nowhere is it stated that the policyholder must be the  Main Driver. The websites directly ASK you to declare who will be the policyholder, who is going to be the main driver and who is additional driver . It is entirely possible to select to be policyholder, select to use the policyholders NCD, but select that  the additional driver will be the Main Driver;  which is from what I understand to be the very definition of FRONTING!?. 

If I am the policyholder using my NCD but select that i am not the main driver my quote is significantly lower.  And this option is a permissable choice. 

So i am confused  by the idea of FRONTING, and when that is considered to be the case. 

pramsay13

Fronting is when you add someone else as an additional driver (usually someone younger) but they are actually the main driver. 

prettyandfluffy

Sorry to hijack someone else's post but a relative recently asked if they could add me to their car insurance policy because it would reduce their premium.  I said no because I'm not going to be driving their car.  I felt uncomfortable with the idea, it seemed somehow dishonest to me - is it? 

ontheroad1970

prettyandfluffy said:

Sorry to hijack someone else's post but a relative recently asked if they could add me to their car insurance policy because it would reduce their premium.  I said no because I'm not going to be driving their car.  I felt uncomfortable with the idea, it seemed somehow dishonest to me - is it? 

It's not necessarily dishonest.  I could add my brother to my policy and he might add me to his and we may never ever drive each other's cars.  We would be insured to do so if we chose to do so.  It's not the same thing as saying that you are hardly ever driving the car when you are actually driving it nearly all the time.  

johnny_c

pramsay13 said:

Fronting is when you add someone else as an additional driver (usually someone younger) but they are actually the main driver. 

I tried to get a new quote on the telephone today. I was asked who will be the Main Driver. I stated that the person i was naming as "Additional Driver " will be doing the most driving.. 

The additional driver is my partner., And has as much experience as me... It's just that I will be the policyholder.  They asked for proof of her NCD, for which they have zero years ( as she had always been named driver under my policy). Never had it been stated that the main driver should be the policyholder.. 

Because, online I can legitimately select that I am the policyholder , the NCD is mine, but the person doing the majority of driving is the additional driver. And my quote is significantly cheaper, and it is not untruthful.

Online I can select answers that appear not to be available when dealing direct...i.e. over the phone it appears they wanted the main driver to also be the policyholder. That was my understanding anyway.

Aretnap

johnny_c said:

FRONTING seems to be described as when you try to 'game ' the system, wherein  the additional driver is in reality the main driver.

However, nowhere is it stated that the policyholder must be the  Main Driver. The websites directly ASK you to declare who will be the policyholder, who is going to be the main driver and who is additional driver . It is entirely possible to select to be policyholder, select to use the policyholders NCD, but select that  the additional driver will be the Main Driver;  which is from what I understand to be the very definition of FRONTING!?. 

"Fronting" is a colloquial term, not a legal term, and as such it doesn't have a single precisely defined meaning.

However it's commonly understood to refer to a type of insurance fraud where you make a false declaration - the insurer asks "who will usually be driving the car", and you reply "me", knowing full well that actually your teenage son will be driving it 99% of the time. In this situation what's illegal is making the false declaration - not the fact that the policyholder and the main driver are two different people per se.

If the insurer asks you who is the main driver is, and you tell them truthfully that it's someone other than the policyholder then you are doing absolutely nothing wrong. What the insurer does with that information is up to them - they might offer you a quote or they might not; they might make the quite more expensive or they might not. You just have to tell the truth and decide whether you like the quote they give you.

Likewise if the insurer doesn't ask who the main driver is you don't have to tell them - some insurers actively don't care and just price on the assumption that the riskier driver will be using the car a lot.

Just read the assumptions carefully because sometimes they will say "you (ie the policyholder) will be the main driver", though they probably won't say this if the drop down menus allow you to select a different main driver.

Aretnap

prettyandfluffy said:

Sorry to hijack someone else's post but a relative recently asked if they could add me to their car insurance policy because it would reduce their premium.  I said no because I'm not going to be driving their car.  I felt uncomfortable with the idea, it seemed somehow dishonest to me - is it? 

No, because by adding someone as an additional driver you are not making any claims about how often he drives it, or even whether he drives it at all. You're just saying that you want him to be insured in the event that he ever does drive it.

Case in point - I've had my car 5 years and I don't think my wife has ever driven it in that time. She certainly has no intention of driving it any time soon. I always add her anyway, just on the off-chance the need arises, and as it happens adding her does being my premium down by a couple of quid.

Your relative adding you would be no different, but if you're really worried about it then just drive his car a hundred years down the street some time. Then there can be no question that you are a genuine driver.

johnny_c

Aretnap said:

johnny_c said:

FRONTING seems to be described as when you try to 'game ' the system, wherein  the additional driver is in reality the main driver.

However, nowhere is it stated that the policyholder must be the  Main Driver. The websites directly ASK you to declare who will be the policyholder, who is going to be the main driver and who is additional driver . It is entirely possible to select to be policyholder, select to use the policyholders NCD, but select that  the additional driver will be the Main Driver;  which is from what I understand to be the very definition of FRONTING!?. 

"Fronting" is a colloquial term, not a legal term, and as such it doesn't have a single precisely defined meaning.

However it's commonly understood to refer to a type of insurance fraud where you make a false declaration - the insurer asks "who will usually be driving the car", and you reply "me", knowing full well that actually your teenage son will be driving it 99% of the time. In this situation what's illegal is making the false declaration - not the fact that the policyholder and the main driver are two different people per se.

If the insurer asks you who is the main driver is, and you tell them truthfully that it's someone other than the policyholder then you are doing absolutely nothing wrong. What the insurer does with that information is up to them - they might offer you a quote or they might not; they might make the quite more expensive or they might not. You just have to tell the truth and decide whether you like the quote they give you.

Likewise if the insurer doesn't ask who the main driver is you don't have to tell them - some insurers actively don't care and just price on the assumption that the riskier driver will be using the car a lot.

Just read the assumptions carefully because sometimes they will say "you (ie the policyholder) will be the main driver", though they probably won't say this if the drop down menus allow you to select a different main driver.

Excellent response.  Yes it seems an ambiguous term.

Some insurers website state                             " policyholder=main driver" as you say, whereas others permit the policyholder to select not to be the main driver (my desired situation).  

DullGreyGuy

Fronting mainly came about in previous years because there was an assumption that the main driver was to be the policyholder and lots of parents insured cars in their own names with their kids, the main drivers, as named drivers to get cheaper premiums. 

Insurers have generally tried to improve the situation by now explicitly asking who the main driver is rather than relying on an assumption and so fronting is now more clearly a deliberate act to defraud by falsely declaring the main driver rather than an argument on if the assumption was clear or not.

As to if "fronting" is a legal term, I'm somewhat in two minds as there are many terms commonly used in law that you wont find in the tiny list of terms in the glossary on the Law Society website however is listed in some US legal websites but purely as a negative activity. Generally fronting is an arrangement where party B contracts with party A but the main beneficiary or provider is actually Party C. Hence Parent (b) buys insurance from Insurer (a) but its for their kid (c). 

Whilst often done for negative reasons, hence US legal dictionary, it's not always the case. If I have a client that wants me to insure all their properties worldwide but I dont have a license to write insurance in South Africa where they have their call centre I can contact a local insurer there and ask them to front the policy for me. So they issue a local policy on their paper and then reinsure 100% of the risk back to me as I dont need to be licensed to write reinsurance. They get a modest fee for the operational work and taking on the credit risk

tifo

In my experience adding an additional driver, esp if they're young, makes no difference to 'fronting' as a main driver because the premium will be based on them anyway.

Bigphil1474

For additional drivers - I'm an additional driver on at least 3 cars that spring to mind, was 4 but one was recently sold. I have always had my OH on my policy even though she hasn't driven for 20 years. Not sure what difference it makes. It's perfectly normal in my family to be an additional driver on someone else's car 'just in case' rather than anything dodgy. I was on my FIL's insurance for years as he was worried he might get ill and couldn't take his wife to appointments. Never drove his car though.