DeAnn Owens
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3 Mistakes That Could Invalidate Your Car Insurance

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set of car keys sitting on an auto insurance policy.

Since driving without insurance is illegal, it is clear that it’s a bad decision. But, there are other mistakes you might not know you’re making that can threaten the validity of your car insurance policy. Here are 3 mistakes you should avoid to make sure you stay covered.   

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Ignoring your teen’s driving status

If you have a young driver in your house who recently earned their driver’s license, it’s imperative you add them to your car insurance policy ASAP. Although you’ll suffer sticker shock since adding a new driver to your car insurance policy can be expensive, it’s a necessary budget-buster.

Relocating to a new state

Your adult kid is forging a new life in a new state, and you’ve allowed them to take your car. That’s a great gift, but it can backfire if you don’t let your insurance company know about the change.

“If your daughter were in an accident, your insurer could say you concealed vital information about the vehicle’s location, deny your claim and cancel the policy,” according to writer Penny Gusner.

Gusner says the right way to handle your car’s relocation is to add your child’s name to the car title. Then they can handle registration in the new state and purchase their own insurance policy.

Paying for insurance on a car you don’t own

If the ownership status of your car changes, say you sell it to your kid, but you are still the one on the car insurance policy, you and your child may incur serious consequences.

According to Gusner, the car insurance company may view this as possible fraud if you don’t tell them you are no longer the car’s owner. And, if something happens to the car or your child is in an accident, your claim can be met with roadblocks.

Car Care: Brake maintenance

If you want your car insurance company to honor your car insurance policy, always be transparent with changes affecting the drivers in your household and your cars.