Co-Signers And Auto Insurance
If you are buying a new car and do not have the best credit score, you may need a co-signer on your auto loan in order to qualify for the vehicle. By agreeing to sign the loan with you, your co-signer is then obligated to pay the loan payment if you do not do so. While having a co-signer on your car loan will most likely not affect your auto insurance premiums, they may need to be added onto your policy.
Just because your co-signer is listed on the loan with you, it does not mean that they own part of the vehicle, unless their name is also listed on the registration or title. If their name is listed, you may be required to list them as an additional insured party on your car insurance policy. Even though your co-signer may not own part of the vehicle, they can be dragged into a lawsuit after an accident. Listing them on your auto insurance policy is a precautionary measure that can help to save you both time and money.
Depending on which lender you are using to buy your car, you may have to provide proof of insurance that includes their name. If you are not required to, you may still want to. If one of your parents is the co-signer on your loan and you still live at the same house, you may be able to add them as an additional insured on your policy, but not a driver. Typically, this will not change the cost of your insurance policy at all.