Kids, cars, college and liability

[Mitchell Andrus]

I'm thinking of putting my son's car in his name... changing the title. This will likely cost more for insurance.

I'm thinking that when he goes to school in ND in the fall (from NJ) I've got too little control over it. I trust my son just fine, I'm worried about someone in the dorm grabbing the keys and going for a joy ride.

My son is judgment proof (no assets), I've got a lot to loose in court in the event insurance doesn't cover the award or declines coverage for whatever reason they can come up with.

Whatdaya think? What did you do?
.

[Frank Trinkle]

I'm thinking of putting my son's car in his name... changing the title. This will likely cost more for insurance.

I'm thinking that when he goes to school in ND in the fall (from NJ) I've got too little control over it. I trust my son just fine, I'm worried about someone in the dorm grabbing the keys and going for a joy ride.

My son is judgment proof (no assets), I've got a lot to loose in court in the event insurance doesn't cover the award or declines coverage for whatever reason they can come up with.

Whatdaya think? What did you do?
.

I think you're a little bit over the top with paranoia. If your son has valid insurance, then you're covered.

The "what if's" on the insurance coverages don't bear out in practice. That's sort of like saying you've got a lot to lose if your homeowners insurance declines coverage for someone that might trip on your lawn, or hurts themselves while borrowing a screwdriver from you... etc.

If the car is for his use exclusively, and he's off to college, it SHOULD be in his name.... (It IS his, right?) and his insurance should also be in his name... regardless of the cost. Can't rely on Daddy forever...

Just my worthless opinion...

[John Lohmann]

good student discount, multi car discount, new tags in new state, too expensive

[Orion Henderson]

An umbrella policy protecting your assets should be sufficient and less expensive than a title change, new policy, etc. They are generally quite cheap.

I have one to protect the business and a single rental property.

Caveat: Umbrella policies are targets for lawyers.

[John Shuk]

In NY if you haven't had insurance in your own name for awhile they surcharge you for quite sometime no matter your age. Shifting it to his name now will be helpful in the future. Might as well get on the train now. Unfortunately I think NJ is one of the highest cost car insurance states in the country.

[Randy Cohen]

and ND might be one of the cheapest

[Cliff Rohrabacher]

It's a wise move. It's not just him it's you you gotta watch out for.

"Negligent entrustment" is the way a lawsuit can follow you home.

Person A loans his car to person C.
C gets in a wreck.
Police report says it's C's fault.
C happens to not have much money.
The injured party goes after person A under the legal theory of Negligent Entrustment saying that "but for" person A's having negligently lent the car to person C who has demonstrated that he was not trustworthy (the accident & police report is the proof of that) the harms would never have occurred. And when they win a judgment they can go after Person A's income, bank accounts, personal property, and real property.

As it regards your insurance:
Unless you are carrying a couple million dollars of liability it might not be adequate. If that's the case then you get sued for insufficient coverage too.
Just because a person has insurance (more than the law requires even) does not mean it's enough. It's only enough when it covers all the harms that actually arise. It's not enough when it doesn't.
So lets say for example that there's an accident in which a soccer mom with a van full of kids is the injured party and all of 'em get really messed up.
And along comes local Joe the police man who happens to attend the same church as Mrs Soccer Mom. Maybe Mrs Local Joe sings in the Choir with Mrs Soccer mom. He is going to look at the accident from the perspective of it being the other guy's fault if it's at all possible. That's the way his report will read.
Under that set of facts the other driver will be on the hook for all the harms as to all those kids.
That can really add up.

[Larry Frank]

My kids went to college a few years ago and I was looking to save a few bucks. My insurance agent told me that in terms of liability even if it was in his name but I was still supporting him such as helping with college that it did not make any difference. He would still be considered as part of my family and I could be liable. Rather than risk any savings or such, I increased my liability. I also had some very direct conversations with the kids on the issue. I made it clear that if there were any problems in any way that they would no longer have a car. Also, if there were any problems, there might not be any more help with college. Good grades and staying out of trouble were what was required for my wife and I to help with the college costs. Luckily, it worked and both kids graduated with no problems and good jobs.

[Dan Friedrichs]

I think you're a little bit over the top with paranoia. If your son has valid insurance, then you're covered.

The "what if's" on the insurance coverages don't bear out in practice.

+1.

I've never even read about someone being liable beyond their coverage limits - have you? (I'm genuinely curious).

Certainly you're right that there is some risk of you being liable, but it's awfully darn small. I think going to college presents much more significant risks in other areas than auto liability, and you should consider trying to mitigate those risks, first.

Make sure he knows better than to leave the keys in the car, but if someone takes the keys, say, out of his desk drawer without his permission, it'd be a long stretch to say that YOU are liable for that...

It's significantly less trouble to leave the title and insurance in your name, and leave the vehicle registered in NJ.

Besides - there's nowhere to drive in ND, and he's far more likely to hit a deer than another car/person.

[Joe Pelonio]

We kept all the cars in our names until they were out of the house for good to save them money. Not only is it higher for them as younger people but they lose the multi-car and multi-line discounts.

My question is why does he need a car there? When our oldest was in college she lived in the dorms the first two years at U of San Diego. When she transferred to U of WA she rented a house with some other girls and they all took public transportation for school, part-time jobs and even fun outings.

I can see someone living at home needing a car to commute to college, but when they move there are usually close enough to not need a car. Unless there are some special circumstances that you didn't mention.

[Curt Harms]

I know insurance costs more for young people under the age of 25. I also know that insurance fraud in New Jersey is one of the very few growth industries in New Jersey and as a result New Jersey insurance rates are freakin' outrageous, or at least they were a few years ago. S.E. PA. near Philly has the same issue. It might be worth calling an insurance agent in N.D. and ask about rates there.

[Frank Hagan]

There are a couple of considerations here. If the car is in your name, it doesn't matter if he has insurance in his name or not, so you are on the right track if you're really worried about it. But if he is still on YOUR insurance, the state he's living in might allow the plaintiff to still come after you. So you would have to have him get insurance on his own too. But insurance for a male under 25 on his own policy is obscenely expensive. It would be easier to increase the liability coverage.

You do have to set some ground rules. Even though you write the checks for the tuition, you have no right to know the student's grade, or even if he is attending the classes. Privacy rights, don't you know. My daughter knew three "students" who went through 2 years of university level courses before being kicked out for not attending ANY classes, and then milked their parents for an additional two years of room and board, tuition, etc. before the parents were either told or caught on. The school told them they could not tell them anything about their kid's academic record.

We required access to their school on-line grade account, so we could independently check their progress. And if we got cut out of that, or they started failing, then the money stopped. We still had some fooling around; you can cancel a class within 30 days and get 50% of the fee back, so one of my kids thought it was a great way to earn a hundred bucks or so for NOT attending.

[Ron Jones near Indy]

My kids went to college a few years ago and I was looking to save a few bucks. My insurance agent told me that in terms of liability even if it was in his name but I was still supporting him such as helping with college that it did not make any difference. He would still be considered as part of my family and I could be liable. Rather than risk any savings or such, I increased my liability.

Ditto and an umbrella policy is cheap!

[Dan Friedrichs]

My question is why does he need a car there? When our oldest was in college she lived in the dorms the first two years at U of San Diego. When she transferred to U of WA she rented a house with some other girls and they all took public transportation for school, part-time jobs and even fun outings.



Because there is no good public transportation in ND (at least not by those standards).

I went to college in SoDak (so a similar semi-rural environment to any of the ND schools he might be going to), and can definitely say that having a car is a very, very good idea. Having a 4x4 truck is a better idea. He'll quickly make friends with all the California girls who get their little 2WD coups stuck in the snow :)

[Matthew Poeller]

My folks did this when I got my own car. When I was just driving their car of course I was just a rider on their policy. My father's financial planner and a lawyer friend had told him that it would be best when I got my own car to be completely separate.

I am not sure that I would take advice from anyone other than a lawyer in this case. I am sure that there are differences all over the country on what is true and what can happen etc etc. I think that your best bet is to talk to a lawyer spend the $100 or $200 to get the proper advice and make the decision from there.

Incidentally, I did get into an accident and there was a lawsuit. Fortunately there was no wrong on my part and the lawsuit was just to make sure that the plaintiff got all of the money from the insurance company. I was assigned a lawyer by the insurance company and since the lawsuit was for a lot more than I was covered for I asked him what would happen. He told me that in all likelihood that they were just doing this to get all of the money and it would settle. That is what happened. He did say though if that were not the case and we went to court I would be liable for anything above the insurance limits. He made mention that it was good that I was not on the same plan as my folks and I was seen as independent from them or it might be different.

This is in NY and might be worth a grain of salt in your state. Oh and just remember, there is nothing, anywhere that can stop someone from bringing a lawsuit against you. And whether you are innocent or not, you have to defend yourself just the same.

[Rick Gifford]

My college age daughter has a problem letting her friends drive my car on my insurance. So I signed the car over to her and she now has her own insurance. She actually pays less than when she was on mine (she used to have to pay the difference in rates when she got on ours... a responsibility thing).

If someone wrecks your car on your policy it is your insurance rates that will go up.

Plus in a worse case scenerio, the person being sued can still owe over and beyond what the insurance policy covers.

College age kids are old enough to learn their own responsibility. Give him the car and let him start being an adult. You can always help him with insurance payments if he gets in a tight spot.