Fronting – What is Car Insurance Fronting?
Fronting is a form of car insurance fraud. It happens when a driver gives an insurance company false information, claiming to be the main driver on an insurance policy when they are not.
The object of fronting is to obtain a lower premium for a higher risk driver (for example a young driver or perhaps a driver with convictions) by adding them as an occasional named driver to the policy, when in fact they are the main driver or owner of the vehicle.
The insurance premium is based largely on the person fronting the policy, in this case, the lower risk driver.
Fronting often comes to light when a claim is submitted. The insurance company may then refuse to pay part or all of the claim and could cancel the entire insurance policy.
The driver may face prosecution for fraud, which could lead to a criminal record and difficulty obtaining insurance in future.
Lack of understanding
Sometimes fronting is not a deliberate attempt to break the law, but flows from a lack of understanding about how insurance works. Parents sometimes front an insurance policy for a child to save them money on insurance, not realising they are doing anything wrong.
What are the consequences of fronting?
We’ve explained what fronting is, and how easily you can fall foul of the law if you add your son or daughter as a named driver to your policy if they are more than an occasional driver of the insured vehicle.
Almost half of all drivers think there’s nothing wrong with doing this, according to a study from AA Insurance. With insurance premiums for younger drivers so high, the temptation is understandable. But are the consequences worth the risk?
- policy cancelled / declared invalid
- the insurer could refuse to settle a claim
- you may have to repay any claim costs already incurred by the insurer
- prosecution for fraud and driving without insurance
- a criminal record, fine and points on your licence
- possible driving ban
- more expensive to buy insurance in future
- harder to access other financial products
Firstly, your insurer will probably cancel the policy, backdated to the date of inception. In effect, this means your vehicle was never insured (an offence in itself).
If the vehicle has been involved in any incident during this time, you might be asked to repay any costs for which your insurer is out of pocket. This could include repair costs to your own car as well as any third party costs, such as repairs, a hire car, injury compensation etc. The final bill could be substantial.
You could also be prosecuted for fraud and for driving without the proper insurance, potentially resulting in a criminal record, points on your licence, a fine or even a driving ban.
In the longer term, if you’ve got a conviction or had a policy cancelled, you could struggle to find affordable car insurance in future. But insurance isn’t the only financial product that could be affected – a criminal record could limit your access to credit cards, loans and mortgages.
Fronting arises from a genuine wish to help young drivers get on the road more affordably, but the consequences to both parents and children really aren’t worth the risk.
The best way forward
It’s understandable that young drivers are keen to find ways to reduce their premium, but you should always have an insurance policy in your own name if you are the main driver of a car.
All Young Drivers can help you find the right policy for your needs, and after the first year you’ll have started to grow your own no claims bonus. From this point you’ll start to make significant savings on your premiums each year.