Cold cash warning for parents of young drivers

10/11/2010 1:53:51 PM

Many parents are committing insurance fraud by putting their children on their own motor policies, it was warned today - and here's a warning for parents stupid enough to let their youngsters drive without a license.

"Fronting" involves parents insuring a vehicle under their own name, despite the fact that it is used mostly by their son or daughter. Such falsifications have occurred in South Africa.

The British Motor Insurance Bureau warned that not only was this illegal but, by declaring false information on a policy, people were invalidating their insurance.

It added that, by failing to have the correct insurance in place, the policyholder and driver also ran the risk of incurring penalties, fines and even prosecution.

Despite the potential penalties, 35 percent of UK drivers thought fronting was just a loophole in the law; 10 percent viewed it as a legitimate way of obtaining cheaper motor insurance.

Ashton West, chief executive of the MIB, said: "There is a lot of confusion among vehicle owners about the importance of giving accurate information about the main driver to an insurer.

"There is a need to help people understand and appreciate the importance of being adequately insured."

AND PARENTS TAKE NOTE: The case is being investigated by the South African police but the daughter of a Cape Town family was in a collision at the weekend while driving solo on a car learner's license.

Frankly, it's amazing how many SA parents allow their children to drive unaccompanied and unlicensed "as long as they don't go far". So, as a reminder to such parents, here's what can happen...

Your insurance company will not pay out, either for your car or for any other(s) involved, and the unlicensed driver is likely to be deemed responsible for the accident merely by driving illegally. In the above case, her car was badly damaged (fortunately only the unlicensed driver was injured, and not seriously).

The family now has no car and cannot afford the repairs or a replacement. Had the other vehicle been damaged, the family would have been responsible for paying for that damage - that could have cost them their house had it been an expensive vehicle.

The unlicensed driver could have been liable for injuries, loss of income, medical expenses and - in a severe case - maintenance expenses for injured parties, possibly for the rest of their lives.

Please, think about the above very carefully and do NOT allow your children to take the family car solo. The cost could, literally, run into millions of rands. It just isn't worth the risk. –