Auto Insurance For Your Kids When You Are Divorced
Divorces may be amicable, but the financial settlements are often complicated. When children are involved, there are many questions of financial responsibility to be answered.
Who will carry the children’s automobile insurance? How will their cars be titled? Who has the responsibility for enforcing rules about driving? These questions can make insuring kids from a divorce very challenging.
However, by careful planning and attention to detail, you can successfully insure your children even in a divorce situation.
It requires communication between the divorcing parents and cooperation on the part of the kids, but it can be done with a bit of work.
First, the most important question facing the divorcing couple is this: who will the children primarily reside with? It is important to answer this question first, because even if the non-custodial parent insures the children, the fact that they live with the other parent may have an impact on that parent’s insurance rates.
For example, if the father only has the children on weekends, but agrees to insure their vehicles under his policy, the mother may find that her rates correspondingly increase as well due to the fact that the teens are considered drivers in her home.
Another question which must be answered is how the cars will be titled.
The person whose name is on the car carries the primary responsibility for insuring the vehicle, whether the child lives with that parent or not. It is never a good idea to agree to pay for insurance for a vehicle over which you have little to no control.
A third factor you must consider is if the ex-spouse will ever drive the car for any reason. If that parent is not covered under your policy and is in an accident in the car, you could have problems with your insurance company about coverage.
So, what is the best way to handle this situation? First, mom and dad should talk about their expectations for themselves and their children regarding the use of vehicles, driving privileges, and insurance coverage.
While it may take a bit of diplomacy in a divorce situation, communication can prevent the majority of problems from occurring in the first place.
Next, the parent with whom the children spend the majority of their time should really be the one to have the cars titled in his or her name and to carry the insurance on the vehicles.
This makes sound economic sense because the parents are not, in this way, paying for two separate insurance policies for the same children.
Of course, the non-custodial parent should agree not to drive the cars of the children so as to minimize liability problems, unless his or her own liability carrier will agree to cover any damages caused.
If the custodial parent is going to carry the insurance and the responsibility for the cars, it is a good idea to figure up exactly what those costs will be, and in the divorce settlement agree to a stipend to be paid by the other parent to defray those costs.
For example, if the mother is the custodial parent and her insurance costs will total $2,000 per year for two children, the father could agree to pay $1,000 per year of this insurance coverage.
The parents could also agree to a fifty-fifty split in maintenance and repair costs for the children’s vehicles. If a claim must be filed by one parent or another, the parents must be able to negotiate the new cost of insurance, which is likely to be higher.
All of this may seem optimistic to expect from parents who are divorcing, but it is for the good of the children. Putting these agreements in writing will help to prevent future arguments or misunderstandings, as well.