Reader’s Question:

My teen got his driver’s license 2 years ago. He is now in college in another state. To my understanding, I was not required to inform my car insurance company about my son so I haven’t told them yet and besides they never asked me. Just recently, we purchased a new vehicle, and my son’s license came up. I got a bill from my insurance company backdated from 7/05-7/07 (what we would have paid) totaling about $1100. I really don’t mind paying more now, but backdating premiums don’t seem right. I am in Brentwood, NY.

Abby

Brentwood, NY

The New York Insurance Department allows insurance company to automatically include children of policyholders to their insurance. This is because in the event that bodily injury or property damage occurs due to that teen’s operation of the vehicle, insurers are permitted to use classifications that reflect a possible exposure for liability on the part of the insurer such a “limited use” classification. However, this reflects the reduced likelihood of an incident due to “occasional” operation by a youthful driver, and is rated lower than if that person were the “principal operator”. And in general, children living away at school (over 100 miles) are eligible for a reduced rate.

If your insurance carrier in Brentwood, NY bills you for prorated insurance charges, legally speaking there is no basis for doing this. However, your insurance company will not do so if your state does not allow it. In the first place, you should have informed your insurance company of your son’s licensing status when he first began to drive. Most insurance companies require their policyholders to list all household licensed drivers and to notify them once their child becomes licensed. Failing to do so could be found as a form of insurance fraud or misrepresentation.

It would be best to contact the NYS Insurance Department to find out for certain if receiving back charges is allowed by your state. The consumer division of this department should be able to inform you if you have a choice or not to pay these charges.