It’s a rite of passage when a teenager gets their first part-time job. As their parent, you're happy because hopefully they'll learn how to manage money and develop some measure of responsibility. Unfortunately, a positive experience for your teen could become a negative one for you if they use the family car to perform their job.
For many teenagers, getting a part-time job means delivering pizzas or newspapers, working as a crew member for a landscaping company, or driving for a van service. One of the requirements for employment is that they have their own means of transportation, but what if that transportation is your family car?
Even though your car is insured under a personal auto insurance policy, if your child gets into an accident at work you could be surprised with a claim denial. For this reason, it’s important that you immediately notify your carrier when your child starts driving the family car for work. The insurer will likely charge you an extra premium, but it's a small price to pay should your child get into an accident on the job. You should also find out whether there are any policy exclusions that might be applicable.
Many insurance carriers are reluctant to cover your teen if they use the family car for these typical part-time jobs because they often carry a great deal of risk. These jobs require the car be driven to different locations and at various times of the day and night. Because there are so many variables, it becomes extremely difficult for the insurer to adequately price the policy to cover the risk they are underwriting.
You may find that you have to purchase a commercial auto policy, which could be more expensive than your personal automobile policy. A commercial policy provides coverage for situations encountered while conducting business that aren’t normally covered under personal auto policies.
Although it may cost more, a commercial auto insurance policy is worthwhile if your child intends to stay at their job for any length of time. Many students keep the same part-time job throughout their high school and college years because it fits their schedule. If that is the case, be sure that your teen is covered during the time they are employed.