Dual Car Insurance - Help! My insurance is being cancelled because my son passed his driving test

inthetoon

I’ve learned something new about the quirks of the insurance industry, which seems somehow stacked against the consumer. I suspect there are many thousands of people caught in this trap each year. Let me explain…

My 18-year-old stepson recently passed his driving test. He has a job and he paid around £2000 to take out a policy in his own name to insure himself to drive my car.

I’ve now been informed by my insurance company that they will cancel my insurance because there is another policy on the same vehicle and not just that, but if my insurance is cancelled that will be something I will have to declare when applying for insurance in the future and is likely to affect my premiums.

The reason I’ve been told is the insurance companies don’t like “dual insurance“ as it could in the event of an accident create confusion over who should pay. I did point out that in the event that I was driving and crashed I would claim on my insurance, in the event my stepson was driving and crashed  he would claim on his insurance.

 The insurance agent on the phone agreed that did make sense, but that just isn’t how it works apparently. 

Where that leaves us is either

A) he cancels the policy he’s just paid £2000 for and I add him onto my insurance. (although I’m told they don’t accept drivers under the age of 21.)

I cancel my policy and search around for a niche insurer that will allow this “dual insurance“.

From my perspective as a driver with nearly 40 years experience and with 20 years no claims bonus this situation seems entirely unfair and designed solely for the benefit of big insurance companies and to the detriment of ordinary consumers.

UPDATE:

The Plot Thickens...

I've just spoken to my son's insurer and they say that his insurance is not valid as I have another policy on my car. They said 'he should have told the agent when he took out the insurance'. My point was that he wouldn't know to tell them and that it should be on them to have that question in the script the agent uses. (note that he did tell them when asked that the vehicle is owned and kept by me.)

I wonder how many other thousands of new drivers and parents are potentially driving without insurance  have paid for cover which is in breach of this small print.

Isthisforreal99

I'm sure it will be stated somewhere in your Policy T&C's that the vehicle can only have one policy on it?

Whilst it's not illegal, many insurers will just not allow it due to the potential hassle and legalities.

Not sure I agree with your sentiment of it just benefitting the insurance companies as the majority of the time it will be cheaper to have a named driver. So the reason they don't allow isn't monetary, well long term it may be as it avoids lengthy legal challenges further down the line.

daveyjp

Unfortunately this sits firmly with OP and stepson in not understanding how car insurance works.  There won't be thousands in the same predicament, its certainly the first time I've  heard of someone insuring a vehicle which is already insured.  One person is the insurance holder, anyone else is a named driver.

Learner insurance on an already insured vehicle would have been far better value.  We paid about £30 a month when my daughter was learning.

Isthisforreal99

daveyjp said:

Learner insurance on an already insured vehicle would have been far better value.  We paid about £30 a month when my daughter was learning.

Except the son has passed his test and driving to work.

Kim_13

You can cancel your own policy and take out another that will insure someone under 21. If you cancel the policy, there is nothing to declare. It is only if they proceed to cancel it and don't retract/reinstate/correct it (whatever they have to do) that you have a declarable problem. 

I suspect there would be something in the documentation that your stepson was sent around no dual insurance. If not, then that would be solid grounds for a complaint - but if he added you as a named driver on that policy then there is a bigger problem as you have been declared as both the main driver by yourself and a named driver by him. Any insurer wouldn't know what to believe.

Ideally, he would cancel it under the cooling off period as he didn't know that the only insurance he could legitimately take out to drive the car was a temporary policy - but it isn't looking good for him if they are already using words like invalid. If the insurance company record it as a cancellation by them, he could try a complaint followed by the relevant ombudsman on the basis he was a new driver and didn't know these things or intend to do anything other than take out a valid policy.

An 18 year old should never be left to arrange their own insurance for a car that they do not own. This has created a huge mess and you could both end up with cancellations on your records here. It would seem safer to me that you leave your policy as is (if your insurers can be convinced to leave it in place as your stepson realises his error and the policy he took out will be cancelled.) Until he has his own record sorted out re: the company he took out insurance with potentially recording a cancellation against him, he shouldn't start trying to get temporary cover either.

The reason dual insurance is created by two annual policies is because fire, theft or someone hitting the parked car would create circumstances where either policy could pay.

MyRealNameToo

inthetoon said:

I’ve learned something new about the quirks of the insurance industry, which seems somehow stacked against the consumer. I suspect there are many thousands of people caught in this trap each year. Let me explain…

My 18-year-old stepson recently passed his driving test. He has a job and he paid around £2000 to take out a policy in his own name to insure himself to drive my car.

I’ve now been informed by my insurance company that they will cancel my insurance because there is another policy on the same vehicle and not just that, but if my insurance is cancelled that will be something I will have to declare when applying for insurance in the future and is likely to affect my premiums.

The reason I’ve been told is the insurance companies don’t like “dual insurance“ as it could in the event of an accident create confusion over who should pay. I did point out that in the event that I was driving and crashed I would claim on my insurance, in the event my stepson was driving and crashed  he would claim on his insurance.

 The insurance agent on the phone agreed that did make sense, but that just isn’t how it works apparently. 

Where that leaves us is either

A) he cancels the policy he’s just paid £2000 for and I add him onto my insurance. (although I’m told they don’t accept drivers under the age of 21.)

I cancel my policy and search around for a niche insurer that will allow this “dual insurance“.

From my perspective as a driver with nearly 40 years experience and with 20 years no claims bonus this situation seems entirely unfair and designed solely for the benefit of big insurance companies and to the detriment of ordinary consumers.

UPDATE:

The Plot Thickens...

I've just spoken to my son's insurer and they say that his insurance is not valid as I have another policy on my car. They said 'he should have told the agent when he took out the insurance'. My point was that he wouldn't know to tell them and that it should be on them to have that question in the script the agent uses. (note that he did tell them when asked that the vehicle is owned and kept by me.)

I wonder how many other thousands of new drivers and parents are potentially driving without insurance  have paid for cover which is in breach of this small print.

By the letter of the law you can have as many policies you want on a single vehicle. The problem comes that the law states that the insurer of a vehicle must deal with claims made against the driver of the vehicle in certain circumstances irrespective of if that person is named on the policy and/or if the vehicle was being used contrary to the terms of the policy (eg commuting when only covered for social use, drink driving etc). 

As such having two full policies creates two RTA insurers and increases the risks of someone suing them for a liability they havent agreed to take on. In principle when they act as the RTA insurer they can often recover their outlay from their policyholder but the reality is when paying a £150k claim not many policyholders have the cash to repay the monies. 

To avoid all these problems most insurers have a clause that they won't cover anything when it's covered by another insurer. In practice it doesnt too often cause problems in reality because had your son had an accident he'd have just told his insurers and they'd have dealt with everything but if the other party's insurer was quicker off the mark then MID could have identified your insurers as the RTA meaning they approach your firm looking for their money back. 

For learner drivers there are specific top up policies, they dont act as a full policy as they only cover the vehicle whilst they are driving it. Whilst its parked up etc its covered by the other insurer. Some used to do something similar for newly qualified drivers but think at least one pulled out the market. In principle your insurer would still need to be comfortable with the setup given they remain the RTA insurer should your son have made a false declaration when taking out the top up policy. 

TELLIT01

As the stepson's policy has been cancelled by his insurer, surely the OP should get back onto his insurer to get his policy reinstated.  He had no part in the other insurance policy.

inthetoon

New update. I cancelled my policy (no under 21s allowed with Darwin)
Stepson has added me and his mum to his policy as named drivers - his premium has come down by £600!

Good news! BUT...

Im told that I will lose my 18 years no claims if I go 2 years without a policy in my name. Same for mum. so...

Totally legal workaround is for me and mum to insure alternate years on her car while stepson continues as policyholder on my car!

Works for us, but I am left wondering at the complete waste of everyone's time this has created for all

Isthisforreal99

inthetoon said:

New update. I cancelled my policy (no under 21s allowed with Darwin)
Stepson has added me and his mum to his policy as named drivers - his premium has come down by £600!

Good news! BUT...

Im told that I will lose my 18 years no claims if I go 2 years without a policy in my name. Same for mum. so...

Totally legal workaround is for me and mum to insure alternate years on her car while stepson continues as policyholder on my car!

Works for us, but I am left wondering at the complete waste of everyone's time this has created for all

Plenty people do as you have said to maintain NCD.

Just make sure that the main driver on the sons policy is correct.

mgfvvc

inthetoon said:

Stepson has added me and his mum to his policy as named drivers - his premium has come down by £600!

Good news! BUT...

Im told that I will lose my 18 years no claims if I go 2 years without a policy in my name. Same for mum. so...

Totally legal workaround is for me and mum to insure alternate years on her car while stepson continues as policyholder on my car!

Alternatively, when this policy runs out reinsure in your name and have a supplementary Marmalade young drivers policy. This allows you and your stepson to both earn no claims. I can't guarantee your insurer will be OK with it, you would have to check.