Teen Car Accidents: What Happens to a Parent's Car Insurance?

According to the Centers for Disease Control and Prevention (CDC), the risk of vehicle crashes is higher among teens aged 16-19 than among any other age group. Risk factors for teen crashes include:

• driver inexperience
• nighttime driving
• distracted driving
• speeding, and
• alcohol and drug use.

If you are the parent of a teenager who recently started driving, you probably have a lot of concerns about your child's safety and questions about your potential liability if your child causes an accident. In this article, we'll answer your questions about parents' legal responsibility for minor teen drivers and the impact having a teen driver will have on your car insurance premium.

Legal Responsibility for Car Accidents

All drivers, including teen drivers, have a duty to avoid harming other people on the road. If a driver is careless (negligent), and someone is harmed as a result, the driver can be financially responsible for that person's injuries and other losses (damages).

Examples of negligent driving include:

• speeding
• texting while driving
• violating right-of-way rules (including failing to yield to pedestrians)
• failing to obey traffic signals and signs, and
• failing to use headlights at night.

Am I Legally Responsible for My Teenager's Car Accidents?

Lawmakers, like parents and insurance companies, recognize that teen drivers are in a special category of risk when it comes to driving. Parents can be legally and financially responsible when their teenager causes a car accident. Legal theories of responsibility vary based on the circumstances of the accident.

Vicarious Liability Laws

Many states have laws that hold parents and guardians responsible for some actions of their children under a legal theory called vicarious liability. Similar laws hold employers responsible for some actions of their employees.

Vicarious liability laws typically don't require the person injured by the teen driver to show that the parent/guardian was negligent in any way. The parent/guardian is liable by law for the teen's negligence. The purpose of these laws is to allow plaintiffs to sue someone who can foot the bill (directly or through an insurance company) for their damages.

In some states, this type of liability might be called the "family use" or "family purpose" rule. Under this rule, parents/guardians can be responsible if their teen driver causes a car accident when using the car for a family purpose, like running errands. The family purpose rule is broad and covers most ordinary uses of a vehicle.

Negligent Entrustment

Parents also potentially face some share of legal responsibility if they knew (or should have known) that their teen driver was a danger on the road and let the teenager drive anyway.

For example, let's say you are the parent of a teen boy named Chris. In the year or so that he's been driving, he's been ticketed twice for speeding. You agree to let him take the family car on a road trip for spring break with his buddies.

During his road trip, Chris rear-ends a woman stopped at a red light. The woman can make a claim against your insurance and sue you for compensation for her injuries, damage to her car, and other losses. She'll have to show that you were careless (negligent) when you allowed Chris to take a road trip in your car.

Driving Privilege Liability

A few states, including California and Florida, require a parent or legal guardian to agree to accept responsibility for a minor teen's driving when the teen applies for a driver's license.

California, for example, requires an adult to sign a minor teen's license application. The person who signs the application becomes jointly liable for damages caused by the teen's driving. (Cal. Veh. Code § 17707.)

Teen Drivers and Car Insurance

Nearly all states require drivers to have liability insurance before they can legally drive. Most teen drivers are covered by their own insurance or a parent's insurance policy.

Can Teens Get Their Own Insurance?

Car insurance providers consider teens to be high-risk drivers, which means insuring a teen driver is expensive. Teens who are 18 or 19 can legally sign a contract and buy their own insurance in most states.

Minor teens will likely need a parent or guardian to co-sign an insurance policy, which means that parents are still going to be responsible for what happens when their teen driver is on the road.

Contact the Department of Motor Vehicles in your state to learn more about what teens need to do to own, register, and insure their own vehicles.

Does My Car Insurance Cover My Teen Driver?

In most cases, it is less expensive for parents/guardians to add a teen driver to their car insurance policy than to purchase a separate policy for the teen. Contact your agent to get a quote for adding a teen driver to your policy. Your teen can typically be listed as a driver on your policy while living at home and potentially while studying away from home at college.

Even if your teen isn't listed on your insurance, you might be on the financial hook if you own the car your teen crashes. An insurance policy covers a car—and anyone who has permission to drive that car. Learn more about permissive use of your vehicle and car insurance.

If your teen driver takes your car without permission and causes an accident, your insurance company might not cover accident-related losses if your teen isn't listed on your policy. You should talk to a lawyer if you find yourself in this situation because your response could have legal and financial consequences for you and your teen.

Learn more about what drivers and vehicles are covered under your car insurance.

Will My Insurance Premium Go Up?

Adding a teen driver to your policy will definitely cause your premium to rise. Factors like what kind of car your teen drives and how much your teens drives can also impact insurance rates. You might be able to lower your premium if your teen:

• completes a driver training program
• gets good grades
• drives an older model, used car, and
• drives limited miles.

If your teen driver is involved in an accident, expect your premium to go up. If your teen was at fault for the accident and your car insurance company has to pay thousands of dollars under your liability coverage, expect your premium to skyrocket.

In some situations, an insurer might choose not to renew your policy or even try to cancel it if your teen has too many at-fault accidents and traffic tickets within one to three years.

Insurance is a heavily regulated industry. Some states have rules about when insurers can raise premiums and by how much. You can contact your state department of insurance if you have questions about your insurance and if you feel like an insurance agent or company has treated you unfairly.

Can Parents Be Found Liable in Personal Injury Lawsuits for Their Teenager's Accident?

Parents and guardians can be sued in civil court when their teen driver causes an accident. In states with vicarious liability laws (see above), parents/guardians might be automatically liable when their minor teen is at-fault for a car accident.

In other states, the injured person (plaintiff) would have to show:

• your teen was at-fault for the accident, and
• you did something (or failed to do something) that played a role in the crash.

For example, you might have played a role in the crash if you left your car keys accessible to a teen who was recently arrested for drunk driving. Or you might be responsible if you asked your teenage son to run to the store for you even though you knew he had crashed two cars in the last year.

Damages for a Crash Caused by a Teenage Driver

Parents and guardians are potentially on the hook for a wide range of damages caused by an at-fault teen driver. The person injured by the teen driver can ask for compensation for accident-related losses, including:

• payment of medical bills (past and future)
• reimbursement of lost income
• pain and suffering (physical and mental), and
• payment for vehicle damage.

Some states have set a limit on how much money a parent/guardian can be made to pay after a teen driver causes a car accident, but these limits might not apply if the parent's own negligence played a role in the accident.

Talk to a Lawyer

If your teen causes an accident that injures someone or causes property damage, talk to a lawyer. You need to understand how your car insurance works and defend yourself and your child against a potential car accident lawsuit.

A lawyer can answer your questions, explain the car accident settlement process, and advocate for you in civil court.

Learn more about how a car accident lawyer can help with your case and how to find an experienced lawyer. You can also connect with a lawyer directly from this page for free.