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One in two drivers think illegal insurance ‘fronting’ is acceptable

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Nearly half of motorists think it’s acceptable for parents to insure their child’s car in their own name to secure cheaper insurance premiums.

This practice is known as fronting – where a named driver on a policy, rather than the main driver, is the person driving the car most or all of the time.

A study of 24,000 drivers by AA Insurance found 49% would use fronting to cut premiums.

Alarmingly, 1% said it was acceptable to drive without any insurance to avoid high young driver premiums.

Fronting is regarded as fraud and can lead to prosecution. If an insurer is satisfied fronting is involved it will likely cancel the policy from inception, as if it never existed.

Michael Lloyd, the AA’s insurance director, said: “The cost of insurance for a new, young driver is often eye-watering so it’s understandable that families might want to look for ways to cut that cost.

“For many people, a parent insuring a youngster’s car and adding them to the policy as a ‘named’ (or occasional) driver might seem to be a legitimate way to get costs down but they may not recognise the potential consequences.”

According to the latest AA British Insurance Premium Index, the typical quoted premium for someone aged 17-22 is £1,436, more than double that for someone aged 30-35, but for a newly qualified driver, without a no-claim bonus, it could be much higher than that.

Lloyd said: “A quarter of young drivers (23%) aged between 17-24 will have a crash within two years of passing their driving test thanks to a combination of youth and inexperience. They are also much more likely to be in collisions that involve death and serious injury.

“That’s why their first couple of years’ premiums are so high.”

‘Cut insurance premium tax for young drivers’

The AA is also calling on the government to cut Insurance Premium Tax (IPT) for young drivers using telematic insurance.

The government has increased IPT twice since 2015, taking it from 6% to 10%. A third rise to 12% is due in June.

The hikes have contributed to car insurance premiums reaching record highs, with young drivers hardest hit.

Lloyds said: “Young drivers suffer disproportionately from the 100% increase in IPT that will have happened by 1 June, in less than two years. If IPT was cut completely for them, it would save up to £300 on a typical first premium for an 18-year-old and would discourage parents from taking extreme and illegal measures to cut costs, such as fronting.”

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