Can an auto insurer raise my premium simply because our daughter acquired a drivers license through school but does not drive any vehicle whatsoever?

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Can an auto insurer raise my premium simply because our daughter acquired a drivers license through school but does not drive any vehicle whatsoever?

The high school requires all students to take drivers education that leads to the ability to get a license. Our daughter has completed the course requirements and has been given the certificate and documents for license but we will and has not allowed her to drive to and from school or any place. Her mother and she have decided that we will purchase her an auto during her junior year and most likely right as this policy is to be renewed and she will begin her junior year with her auto and driving to and from school, and to a job that we have strongly suggested she obtain.

Asked on December 10, 2011 under Insurance Law, Iowa

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Yes, your insurance rates may be raised because your teenage daughter has a license, even if you claim she will not drive any of your cars. Insurers base rates on risk; risk is a function in large part of the number and identify of drivers in a household; teenage drivers are higher risk; and the insurer does not have to believe you or accept your claim that your daughter will never drive--you could be lying; she could take the car without permission; you could change your mind or make an exception one time; etc. Simply adding a teenage driver increases your risk profile and hence premium.


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