Some people are using company car insurance policies to cover relatives or family members who may not be able to afford cover themselves, it has been claimed.
According to Norwich Union, fronting is becoming an increasing problem in commercial motor insurance and is often down to directors and managers of the businesses.
In many instances it is young family members who are learning to drive and cannot afford insurance themselves that are being covered.
Mike Smith, commercial motor technical manager at Norwich Union explained why fronting seems an easy option to people.
"Although this may seem as though they are doing that family member a good turn by saving them some money, and the credit crunch may make this appear even more financially attractive, the risks to both the company and that young driver are substantial," he said.
According to the AA, for those young drivers who are involved in accidents the average car insurance claim is just under £4,500 for males and £2,700 for females.
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