Car insurance - driver fault & car owner fault?

by Halina
(Toronto)

Hi,

I own 2 cars & my daughter was insured by my policy as primary driver of one car. She had an accident on icy road & premium went up.

Understood.

However, recently she moved permanently from ON to BC where she does not own car yet. I called my insurance to remove her from my policy but this did not reduce my high premium. Insurance said that accident is on my record & there is no difference if she is on policy r not.

It is hard to understand since there is one driver less on my policy. Also, what will happen when she will buy car in her name & apply for car insurance?

Will this accedent also be on her record as it is on mine? If that is true, would that mean that insurance companies can apply double-penalty & higher premium, one on my policy & one on hers?

Thank you for clarifying this.
Concerned Mom

Reply for mom

You have asked some very good questions.

The short answer is that the insurance policy holder (registered owner of the car) assumes responsibility for any claims on their policy.

This is regardless of whether the person who was at fault has access to your cars or not.

But there is a problem with this. When your daughter tries to get her own policy the at fault accident will show on her report as well. And the insurance company will want to "rate" her for that on her policy. And you will both be charged for one accident.

So what can you do?

You really can't do anything she gets her own policy. Once she gets a policy, you might be able to show your insurer that she is rated for the accident on her policy. As a result, they might be able to stop rating you for it. The problem for the insurer is that they will need proof every year that your daughter is rated for the accident. So on the rare occasions this solution happens, it is usually when the same insurer insures both parties.

Hope that helps a little!

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