How Long Can You Stay on Your Parents’ Car Insurance?

It is often preferable to stay on your parent's car insurance policy for as long as possible in order to avoid the higher cost of stand-alone coverage. However, depending on your insurer and the insurance laws in your state, you may be required to obtain your own policy. Life's milestones, such as starting college, getting your first apartment, or purchasing your first car, can indicate when it's time to make the switch.

When You Need To Buy Your Own Auto Insurance

In contrast to health insurance, a child can remain on his or her parent's car insurance policy indefinitely. This is true for children of all ages, whether you are an 18-year-old high school senior, a 35-year-old living with Mom and Dad, or a 50-year-old caring for ageing parents. In fact, even if you have your own policy or don't drive, you may be required to be listed on your parents' policy if you live with them.

Even if you live with your parents and are listed on their policy, you may be required to carry a separate policy. The terms and conditions that govern when vary between carriers and states, but frequently include the following situations.

The title is in your name: Many states do not require a vehicle to be registered and insured under the same name as long as the vehicle is registered and insured in the same state as the owner of the insurance policy. However, if your state requires that the title and insurance bear the same name, you must purchase a separate policy, even if you live with your parents.
You move to a new address (not for college): Insurance follows the vehicle, so if you move, the insurance company will almost certainly require you to obtain your own policy.
You're a college student with the following title: If you're going to college, don't live at home, and the title is solely in your name, you'll most likely need your own policy.

When You Can (or Must) Stay on Your Parents’ Car Insurance

In some cases, a child may be able to remain on their parents' insurance policy even if they move to a different address. However, always check with your insurance agent about the provider's requirements as well as any applicable state insurance laws.

You live in your own home and drive a shared vehicle: Even if they have their own car and separate policy, children who live at home and are of driving age are usually required to be listed on their parents' car insurance policy. In most cases, insurers will require a list of all household drivers in order to assess risk when calculating your premium.
You are away at college, but you continue to use the family address: If you move away for college and drive a car registered in a parent's name (or jointly registered), you may be able to stay on your parents' policy rather than purchasing your own. This is less likely if you live off campus and away from your parents' home all year.
You frequently drive your parent's car: Children who frequently drive their parents' vehicles, regardless of where they live, should be listed on the insurance policy.

Should You Stay on Your Parents’ Insurance?

Teens and young adults pay more for insurance than older adults, especially for stand-alone policies. If you share a family vehicle and live at home, it's probably best to stay on your parents' policy until you're in your mid-20s, when rates may have dropped and you've had a chance to establish good credit.

More than 90% of insurers use credit-based insurance scores to determine your rate, according to Nationwide, citing studies that claim credit is a predictor of insurance losses.Credit-based insurance scores are prohibited or limited in California, Hawaii, Maryland, Massachusetts, Michigan, and Washington.

If you have no or bad credit and your parents have good credit, you should consider staying on their car insurance policy until you can establish a favorable credit history.

Discounts

Getting your own policy can also have an impact on discounts. Your parents may be eligible for discounts that you are not, such as a bundling discount for home and auto policies or an affinity discount for membership in an association.

Similarly, you may have earned a good student or good driver discount, which reduces your rate even further. Consider remaining on your parents' policy and sharing the cost of insurance if you are a working adult who still lives at home.

Getting Started With Your Own Insurance

Follow these tips when shopping for your first auto insurance policy to get the best coverage and premium.

Shop around: Before purchasing a policy, obtain quotes from at least three insurance companies. Because insurers evaluate factors such as your credit score and driving record differently, rates can vary greatly depending on your situation. Get insurance quotes before you buy a new car to find out how much it will cost to insure.
Understand the state's minimum requirements: Each state has its own set of minimum auto insurance requirements. Minimum coverages are frequently insufficient, so consult with an insurance agent to determine how much coverage you should purchase in light of your specific circumstances. If you lease or finance a car, the leasing company or lender will also require you to purchase collision and comprehensive insurance.
Use discounts: Discounts can sometimes significantly reduce the cost of car insurance. Earning good grades, insuring a vehicle equipped with safety and security devices, taking a driver training course, and purchasing more than one policy all qualify for discounts from insurers. Some providers provide greater discounts than others, and discounts vary by state.
Determine your deductible: Your deductible is the amount of money you will have to pay out of pocket if you file a claim. For example, if you have a $500 deductible and your claim is approved for $1,500, the insurance company will pay $1,000. Lowering your deductible will result in a higher premium, while raising it will result in a lower rate. Determine how much you can afford to pay out of pocket before purchasing a policy.

Frequently Asked Questions (FAQs)

Can you stay on your parents’ car insurance when you move out?

It is conditional. If you go to college, you may be able to stay on your parents' insurance policy. However, if you move out to live on your own at a new address, you will almost certainly require your own policy. If you move out, state insurance codes and your insurer's terms and conditions may also affect your ability to remain on your parents' policy.

Can you still be on your parents’ car insurance when you’re newly married?

You may be able to stay on your parents' auto insurance policy if you marry and continue to live with them. However, if you move to a new address, your insurer will almost certainly require you to obtain your own policy.

Can you stay on your parents’ car insurance if you move to a different state?

If you move, most insurers will require you to purchase a new policy. If you attend school out of state and your parents own the vehicle you use, you may be exempt.

Is it cheaper to be on your parents’ car insurance?

In most cases, remaining on your parents' policy is less expensive than purchasing your own. Rates typically decrease when young drivers reach their mid-20s, but several factors influence your car insurance premium, including your credit history, driving record, location, make, and model of vehicle, and the types and amounts of coverage you purchase.

Is there an age limit for being in your parents’ car insurance?

No. You can continue to be covered by your parents' auto insurance policy indefinitely. However, if you live elsewhere or have a vehicle titled solely in your name, you may be required to purchase your own policy.