Can I insure a car that is not registered in my name?

Can you insure a car that isn't registered in your name in Australia?

Yes, you can insure a car that's not registered in your name. Ownership isn't required to buy car insurance. The most important thing is to correctly list the primary driver of the car when you get car insurance.

Examples: when it's OK to insure a car registered to someone else

1. Let's say your mum is super generous and lets you use her car on the condition that you pay for the insurance on it. This is okay. You are able to buy insurance (and have that insurance in your name) for your mum's car (which is in her name).
2. Your friend is moving overseas for a year and has said that you can borrow her car while she's gone, you just have to insure it. Again, this is fine. You can purchase car insurance for that car, even though you don't own the vehicle.

Identifying the primary driver

When you're filling out the insurance form, it'll ask you who the primary driver of the car is. This means: who drives the car most often? You have to be truthful when you answer this. If you're borrowing your mum's car and will be driving it more than her, you must list yourself as the primary driver.

If your mum still drives it more often than you, then it's fine to list her as the primary driver.

Insurance fronting is when you list the wrong primary driver

As long as you truthfully list the primary driver of the car you're in the clear. But what if you don't?

For younger drivers or those with a muddied driving record, for example, it may be tempting to list an older driver as the primary driver of the car to get cheaper premiums.

But if this isn't true then it's called car insurance fronting. This is illegal.

If you're found to be car insurance fronting then your insurer can void your insurance policy altogether, making it worthless.

Expert insight

"There is a duty not to make a misrepresentation. Saying someone is the regular driver when they are not, in order to obtain a cheaper premium is a breach of this duty. This gives the insurance company the right to void the policy and not pay and claim if fraudulent or if they can prove that, had they known, then they wouldn't have insured the car."

Don Shields

Insurance broker

Insuring a car you own, in someone else's name

When we refer to 'insuring a car in someone's name', we're talking about listing a person as the primary driver on that car insurance policy. The actions of filling out the document and paying for it are irrelevant.

So if you are looking to insure a car you own and want to put that insurance in someone else's name - this is fine, as long as you do it for the right reasons.

Right reason = You own the car but someone else drives it more often. Therefore, you insure the car in their name as they are the primary driver of the vehicle.

Wrong reason = You own the car and you drive the car most often, yet you've chosen to insure it in someone else's name because you think it'll make your car insurance bill cheaper. This is called car insurance fronting and it's illegal.

Case study

"We have a spare car and let a friend borrow it while his own car was being repaired. While it was tempting not to change over the insurance details, we ended up doing it because it's better to be safe than sorry. It ended up costing a little bit extra to have him as the primary driver but at least we knew that we'd be covered if anything happened while he was driving it. It was also a speedy process! I felt much better once it was all done."

Peta Taylor

Publisher of Insurance

Can I go on my parents' car insurance policy?

Yes, but there are rules around this. To understand how this works, we'll start with a few important definitions:

• Primary driver: This is the person who drives the car the most often.
• Additional drivers or Listed drivers: These are the people who will drive the car sometimes, but not as often as the primary driver.

So, when we're talking about whether or not you can be added to your parents' car insurance policy, the answer is yes. You just have to decide if you should be added as the primary driver or as an additional/listed driver.

If you're under the age of 25 and are added as the primary driver, there's a good chance this will make your car insurance bill more expensive. It's frustrating, but you can't pretend you're not the primary driver just to avoid this.

Other ways to get a cheaper car insurance premium

Gary Ross Hunter, Insurance and innovations editor

"While it can be tempting to put your car insurance policy in the name of another driver for the sake of a cheaper premium, this is considered insurance fraud. Luckily, there are other ways to reduce the cost of your premium. Many insurers allow you to adjust your excess; the higher your excess, the cheaper your premium. Remember, you still need to be able to afford your excess so adjust this responsibly."

Peta Taylor, car insurance expert

"Not all insurers ask who else drives your car beyond the primary driver, so an occasional driver you don't list usually just means a higher excess if they're ever in an accident. But if someone drives your car regularly - a partner, adult child or other household member - you must declare them. Under your duty to take reasonable care not to make a misrepresentation, failing to list a regular driver can mean your insurer refuses the claim entirely, not just charges a bigger excess."

How to insure a car that is not registered to you

Insuring a car that is not registered to you is entirely possible, you just have to do it correctly. To do this, start by familiarising yourself with the terms; "primary driver" and "listed" or "additional driver". This will help you know how to fill in the forms correctly and get the car insured in a way that won't cause problems further down the road.

Primary driver: This is the person who drives the car the most often.
Listed driver or additional driver: This is a person who drives the car but they're not the person who drives the car the most. If you're a listed or additional driver, you might borrow the car from time to time but someone else drives it more often than you.

Once you know how to define your usage of the car, you can get a quote online and proceed like normal. Really, your only duty here is to be honest with the insurer about how you're using the car and who is driving it. The insurer isn't concerned with who owns the car. It may not even ask about it.

What happens if I get car insurance under my parent’s name, but I'm the main driver?

If you never get caught doing this, then probably nothing. But if you do get caught doing this, you'd be breaching your duty of disclosure to the insurance company and they could void your insurance altogether.

This would make the policy worthless, despite what you've paid for it. This is known as insurance fraud and it's illegal. You're better off just being honest from the start.

If you're a younger driver and you want to reduce the price of your car insurance premium, read our guide on car insurance for under 25s.

FAQs

• Can you insure a car that is not registered in your name in Australia?

  Yes, this is entirely possible and okay to do.

• Can I put my children on my car insurance?

  Yes, you can add your children to your car insurance policy. You just have to be truthful about whether or not they're the primary driver when getting your quote.

• Can I drive a car with my parents' name on the insurance?

  This is a tricky one because it depends on their car insurance policy and how it treats unlisted drivers. Some insurers will cover all drivers of a car, some will only cover those who are named on the policy. To know if you'll be covered to drive a car with your parents' name on the car insurance policy, you'll have to check the product disclosure statement (PDS) issued by the car insurance provider. This can be found on their website.

• Can I change the main driver on my insurance?

  Yes, you can modify your car insurance policy at any time. You just have to get in touch with your insurer, make the changes and pay any charges (if there are any, there aren't always) associated with the change.

To make sure you get accurate and helpful information, this guide has been edited by Tim Bennett as part of our fact-checking process.

Written by

Peta Taylor

Publisher of Insurance

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Peta Taylor is a publisher at Finder, working across all of insurance. She's been analysing product disclosure statements and publishing articles for over 2 years. Peta is passionate about demystifying complex insurance products to help users make well educated decisions with confidence. Peta is part of Finder's insurance awards team and works alongside editorial and insights experts to bring users the best insurance products every year. See full bio