What can happen to my husband?

Question

My husband wants to but his parents car under his name, his parents dont have licenses they are illegal. If my in laws get in an accident what can happen to my husband since the car is under his name? I know he wants to help his family, but how can i convince him its not a good idea.

Answer 1

Answer from a General Insurance Agent

Actually it is Highly Illegal. What your saying is that they want the vehicle in his name although they will actually be the owners ( defrauding the State by filing false ownership on the title). They also don't want to be on the insurance policy because they are illegal and don't have a drivers license and figure the insurance would be too high, even though they will actually be the primary drivers (So you will also need to defraud your Insurance Company).

Failure to disclose a known driver is Insurance Fraud by missrepresentation of a known risk. Enticement of an insurer into issuing an insurance policy by deceit is "Insurance Fraud" and is a Felony in every state carrying a penalty of up to 20 years in prison. BTW, It is also a Federal felony offense, but thats FBI stuff, a little higher up than your state offense.

Arguing that you loaned them the car is rediculous when they have regular acces to the vehicle and are actually the "Primary Drivers" of the vehicle. Every Auto insurance Policy contract requires Disclosure of all Drivers of the vehicle.

Should the fraud be discovered any of the following can happen.

1. Cancellation of the insurance policy even retroactively, meaning a denial of coverage even if they don't find out until after an accident. An insurer is not required to pay claims or damages that are the result of insurance fraud.

2. They can increase your premium as it should have been rated for the unlicensed drivers even while still canceling the policy, The Insurer can then demand that you pay the increased rate retroactively to the inception of the policy. Failure to pay can ruin your credit and Collection agencies galore will be contacting you and your husband notifying you of your now bad credit rateing.

3. Felony fraud charges could be filed against your husband and anyone who was complicit in the fraud. i.e. you and his parents.

4.  Since any accident would not be covered under the insurance policy that was obtained fraudulently, Your husband being the regisrtered owner and yourself as his spouse can be personally sued and held liable for any all damages, injuries, attorneys fees and court costs. So say good bye to the savings account, the retirement account,, Say good by to the home if you were buying it and say Hello to Bankruptcy court, bad credit and possibly even prison.

5. If stopped by a Law enforcement officer and he realizes what has occurred, he can have the vehicle towed and impounded, confiscate drivers licenses and vehicle plates and even arrest the drivers if he so chooses.

6. Next comes the thousands of dollars worth of associated fines in the form of tickets, attorneys, bail bonds and court costs.

7. After the "Insurance Fraud Conviction" you and your husband will no longer be insurable as no Insurance Company would ever knowingly issue another insurance policy to anyone with this kind of record, so the state can then suspend your Husbands drivers license as well as that of any complicit parties for 10 years if you happen to have a friendly judge. If the Judge is not so friendly or perhaps has a relative who also was in an accident with an un-insured driver he may just decide to revoke your drivers licenses permanently, after all. since you are no longer insurable and the law requires you have insurance to drive. then quite naturally you will no longer have a need for drivers license anyway.

Believe me this is not the end of it.

It's quite a shame to have to go through all this for no reason, If his parents are from Mexico and they have a Mexico drivers License, they can easily obtain their own auto insurance through any of hundreds of insurers that issue policies to foreign drivers. My company and many others will issue an Auto Insurance Policy to people with an "International drivers license" or a license from any other country in the world, we have customers with "Mexico licenses", "Canadian licenses", "Australian drivers licenses", "British licenses". I even have a customer here from Kenya with a "Kenya drivers license", so none of this is even necessary.

Your question should not just be what can happen to your husband, but "What can happen to you Both". since under common law as his spouse you can both be held fully liable  jointly and severally for the actions of the other.

It's not just a bad idea, it's Illegal.

It sound to me like his parents either don't realize that they can obtain their own insurance or they are just looking for a way to get it cheaper by having your husband put it in his name.

Understanding that your husband would like to help his parents, Try telling him to just loan them the money for a downpayment to get their own policy, make some phone calls to independent agents or mexican insurance agents in your area and look for one that has a program for foreign drivers. It will likely only take a couple hours to find one and does not require you or your husband to commit a felony and jeapordize both yours and his future. With a foreign license they will typically pay 20 to 40 percent more than a US licensed driver for their policy. It's really not a bad deal and it's legal.

If your husband still insists on breaking the law for his parents, You might ask him to wait until after you get yourself a seperate insurance policy from his, and after you divorce him and transfer any joint property into your name alone so that you won't be held financially liable for his actions and lose your savings, your home and any other property you might like to keep. Maybe that will get his attention.

Good Luck and Happy Motoring

Answer 2

His insurance will go through the ROOF! He will have to buy a bike and ride it to work because after an accident in a car with an unlicensed driver getting insurance will be as easy as finding the city of gold! Also if the parents hit someone or hurt anyone or run into someone's home or whatever! that person can personally sue your husband for damages and take away everything you own! Here and in the future! By the way marriage laws in most states would include YOU in the lawsuit.

Answer 3

There's nothing illegal about this - you can loan your car to anybody you want to.  Obviously.

The important thing is the financial part of it.  You didn't mention insurance. You need to decide how that plays out.  There are 3 possibilities:

1.  You are destitute, and have nothing, and so you don't need any insurance

2.  You are worth some money, but you don't insure the car, and take a chance on losing everything you have.

3.   You insure the car.  

It's prohibited to insure a car and then loan it to somebody else for years and years.  21 days is the limit based on my experience.  You can deal with that.  The fact that they're unlicensed may be the deal breaker.  You might be able to just put them on your insurance.  I do not know if your insurance agent will let you assign a driver to the car that's not part of your household.  Interesting question there.