Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Jun 25, 2019

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Deciding whom to list as the primary driver, also known as the policyholder or first party, on your insurance policy may not be as easy as it sounds. This is especially true if you are interested in saving as much money on car insurance as possible.

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Determining whom you should and should not add to your policy as secondary policyholders can also be a challenge. You should discuss this with your insurance company so that you clearly understand their policies regarding multiple drivers on one policy. You also need to make sure they list drivers correctly in terms of who is the primary and who is secondary.

Of course, if you are the only driver listed on your car insurance policy then you do not have to think about this. However, if you have other people such as family members on your policy, you will have to make some decisions based on each person’s driving record and usage of their car.

Listing the correct person as the policyholder and being careful who else is allowed to be listed on an insurance policy could save you a lot of money.

Multiple People on One Car Insurance Policy

You may not be aware that you can actually add multiple people to one car insurance policy and choose any of them to be listed as the primary policyholder. Whom you can add and how many people you can add will depend upon your car insurance company

Some people look to combine their policy with another’s policy and split the cost in order to save money. Just make sure that the person you combine policies with will influence your premium cost in a positive way and not cause it to go up.

Some general guidelines for who can be added to a car insurance policy include:

  • Parents are allowed to add a teenage driver to their policy. The age at which a young driver must move to their own policy will differ depending on insurance company and circumstances.
  • Typically, you can add anyone living in your immediate household to your policy. This may include blood relatives, those related by marriage, or in some cases, others who reside with you but are not related.
  • Some insurance companies allow you to add individuals to your policy who do not live with you. Usually these people must be related, but there are some companies that are more flexible in terms of who can be added to a policy.
  • Business owners may want to add employees who drive a company vehicle regularly.

Most car insurance companies have a limit to how many people can be added to a single policy. Usually the limit is four or five. Beyond this, a second policy must be opened.

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Determining Which Person to List as the Policyholder

Now that you have determined whom you can add to your policy, you need to decide which of these people will be listed as the primary policyholder. This is the main individual whose name the policy is listed under, and this person should be the one with the lowest insurance risk rating.

The person considered the most conservative driver is the one who will be charged the least for their premium.

The Connecticut Department of Insurance outlines several factors that will impact how much a person will pay for car insurance. These factors are very similar in other states and include:

  • Driving record – One of the greatest factors in determining how much you pay for insurance is your driving record so keep it clean to lower your premium. Even a couple of speeding tickets can cause your insurance rates to go up.
  • Age of individual – Younger drivers typically pay more for car insurance than older drivers with more experience do.
  • Gender – Males typically pay more than females for insurance because statistical data shows they take more risks when driving.
  • Make and model of vehicle – Faster, sportier vehicles typically cost more to insure than larger, more conservative vehicles.
  • Location in which you live and work – If you live or work in an urban, higher crime area, you will pay more than those living in a rural or suburban area.
  • Credit score – Keep your credit score high or you may pay more for car insurance.
  • Safety features added to the vehicle – Features such as side-curtain air bags, back up cameras, and automatic seat belts will help to lower your premium.
  • Annual mileage – If you drive less than a standard amount of miles each year you can save on car insurance.

Financial Responsibility

One thing to keep in mind when determining primary and secondary policyholders is that the primary policyholder is ultimately the only one responsible financially for making sure insurance premiums are paid. This person is also responsible if a claim is paid only partially and further out-of-pocket costs are necessary.

In the event a lawsuit does occur after an accident, the primary policyholder will also be named in the suit in addition to the person operating the vehicle. The primary policyholder should be able to handle this responsibility.

Listing Your Spouse on Your Policy

When you get married, it is a good idea to contact your insurance company and have your spouse added to your policy. You can also decide whether you or your spouse should be listed as the policyholder. Failure to notify your insurance company when you get married and adding your spouse to the policy could result in the company claiming misrepresentation. They may refuse to pay your claims if your spouse is involved in an accident.

If your spouse’s driving record negatively affects your premium costs, you may want to shop around for insurance with a new company offering lower rates.

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Teen Drivers

Teen drivers who are listed as the primary policyholder on an insurance policy will pay a very high premium because they fall into a high-risk category due to their inexperience behind the wheel. If they can get a policy with their parents or another responsible adult listed as the primary policyholder, they will pay much less.

Students can save on insurance if they maintain good grades and qualify for a good student discount.

The Insurance Information Institute warns drivers to be careful when others, especially teenagers, are listed on their policy. Some companies will automatically assign the policy to the driver who is most expensive to insure. In this case, it could be the teenage driver. Contact your insurance company and make sure they are listing the policy under the driver you wish to be the primary policyholder. If they raise your rates significantly, you may want to get quotes from other local insurance providers.

Senior Drivers

Many senior drivers wish to be added to an auto insurance policy belonging to a grown child or other family member. This may be due to a fixed income and difficulty affording car insurance, they have moved in with their adult children, or simply that it may be easier to combine their policy with that of a relative once reaching a certain age.

If you are considering adding a senior to an insurance policy and are trying to decide whether to list them as the primary policyholder, here are some guidelines to keep in mind. Seniors over the age of 55, but under the age of 70 are typically less expensive to insure. They are considered low-risk, conservative drivers and because this age group is often retired from work, they frequently drive less.

According to the Institute for Highway Safety Administration, once a senior passes the age of 70 their insurance costs will go up. Premiums increase significantly over the age of 80 because these elderly drivers now become a statistically higher risk.

Seniors may be able to save money on their insurance by participating in a defensive driving course.

Excluding Drivers

In addition to adding drivers to your policy and determining which driver the policy should be listed under, you may want to specify drivers who should be excluded from your policy. This means they are not allowed to drive your vehicle. This may come up most often when there are drivers living in your household whom you do not want included on your policy.

Some auto insurance companies will automatically list these drivers on your policy, which could increase your premium. Make certain you specify that these individuals should be noted on the policy as excluded.

In most cases, the insurance coverage follows the vehicle not the individual. The Insurance Information Institute explains this further and warns against letting anyone drive your car if you do not trust their driving ability.

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Death of the Primary Policyholder

When the primary policyholder passes away, the secondary policyholders can drive the vehicle until which time when the estate determines whom the vehicle will belong to. Then that person is responsible for purchasing their own policy or selling the vehicle. In the event the deceased is married, the vehicle and insurance would typically automatically transfer to the spouse.

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