Parents could face six figure bills for fronting

10 Jun 2010 at 16:07

Parents are risking huge financial penalties by falsely claiming that they are the main drivers of their children’s car.

Research commissioned by Young Marmalade and First Car Magazine found that the practice was widespread, with 41.79% of parents engaging in it.

The practice, known as ‘fronting’, greatly reduces the insurance costs but is also illegal, and many parents are unwittingly putting themselves at risk of prosecution.

Nigel Lacy, co-founder of Young Marmalade, warns that if the child has an accident, injuring a third party, the insurer could refuse to pay the costs, leaving the parent with a six figure bill.

The cost of insuring a young driver can be around £4000, an accurate reflection of the risk they represent, according to the Motor Insurers’ Bureau’s Ashton West.

However, fronting may save cash in the short term but can be surprisingly easy to detect should an accident occur.

Insurers can simply ask neighbours who most often drives a given car, uncovering the practice and giving a valid reason for not paying out.

Young Marmalade was set up to provide younger drivers with better insurance deals, providing not only lower premiums but also selling cars along with insurance.

Source: Insurance Daily, 10th June 2010