Red Flag: Kids At Home With Their Own Auto Insurance
Many clients come to us trying to justify their decision to put a car and separate insurance policy in the name of their living-at-home child saying, "this way we won't be responsible if a bad car accident happens." Actually...
If you have any client that has a child living at home with their own insurance policy, make fixing this potentially monumental problem a top priority! I won't bore you with a full dissertation on the reasons why, but it's sufficient to say here that many, many gaps in insurance coverage can exist under a situation like this. In addition, many more opportunities exist to "lose control" over keeping limits of liability high enough, paying the premium, controlling the underwriting, etc. when a policy is written in the name of a child.
If you have any clients with multiple auto insurance policies in one household that should be the tip-off to talk to an insurance expert asap to make sure that if there are existing gaps in coverage, they are filled right away. And if you do want to bored with the full dissertation on all the reasons there are problems with this scenario, I'll be happy to comply with your request.
Mechelsen, Inc. Darren McGraw, MBA, CIC mechelseninc.com
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