Transfer car insurance to your child: Save costs and secure benefits
27 May 2025
12
Minutes
Katrin Straub
CEO at nextsure
Is your child starting their driving journey and considering their first car insurance? Discover how transferring your no-claims bonus can give your child a financial advantage and help avoid high premiums for beginners. A well-planned transfer can reduce insurance costs by hundreds of euros per year.
The topic in brief and concise terms
The transfer of the no-claims discount (NCB) from parents or grandparents to children can significantly reduce the car insurance premium for young drivers.
A prerequisite is usually a close relationship, and the child can only inherit as many years of no-claims bonus as they could have accumulated since obtaining their driver's license themselves.
The transferor irrevocably loses his or her SF class; therefore, the transfer should be carefully considered and only carried out if the SF class is no longer needed.
Transferring SF-Class: Understanding the Basics and Recognizing Potential
Transferring a no-claims bonus (SF class) is a common way to financially ease the entry into their own car insurance, especially for young drivers. Here, the current holder of an SF class passes on their accident-free discounts, accumulated over the years, to another person. This can reduce the annual insurance premium by up to 70 percent. It is the SF class itself—meaning the number of claim-free years—that is transferred, not the specific discount rate in percent, as this can vary from insurer to insurer. This regulation applies to motor liability and comprehensive insurance; a partial cover insurance does not have any SF classes. The option to transfer a car insurance policy to a child is therefore a valuable tool for cost optimisation. Each insurance company individually determines the exact conditions for such a transfer, so it is essential to clarify this with the provider early on. This first step lays the foundation for substantial savings over many years.
Check requirements: Who can receive SF classes and what conditions apply?
Not everyone can take over unlimited SF classes. One key condition is that the recipient can only be credited with as many claim-free years as they could have accumulated themselves since obtaining their driver's licence. For example, if your child has had their driving licence for three years, they can only take over an SF class corresponding to three claim-free years, even if you want to transfer SF 30. For absolute beginners, the transfer is therefore often only partially worthwhile, or not at all. The transfer is generally restricted to a specific group of people. This usually includes close family members such as spouses, registered civil partners, children, parents, grandparents, and grandchildren. Some insurers also allow the transfer to siblings or people living in the same household. Another common requirement is that the child has regularly used the vehicle whose SF class is to be transferred. Find out about the details of taking over car insurance to ensure all criteria are met. Thoroughly reviewing these points is crucial for the success of the transfer.
The transfer process: Step by step to a cheaper policy for your child
The process of transferring a no-claims discount class is clearly structured but does require some formalities. First, as the person transferring, you must submit an application to your car insurance provider. Many insurers provide specific forms for this purpose, sometimes referred to as TB28. In this application, you declare your waiver of the no-claims class in favour of your child. HUK-Coburg, for example, states that there is no longer a need for a printed form; the application is made online. The following documents and information are typically required:
Vehicle and contract details of the transferor and the transferee.
A waiver declaration from the transferor.
A copy of the recipient's driving licence.
A statement on the relationship.
Signatures of both parties.
After review and approval by the insurer, the no-claims class is transferred to the child's contract. This can also occur with a change of policyholder. Be aware that the transfer is generally permanent, and you will lose your no-claims discount class. Therefore, careful consideration is important beforehand.
Special cases and details: What to consider for second cars, company cars, and in the event of death
Apart from the direct transfer from parents to children, there are some special situations. For example, if you own a second car, its SF class can often be transferred separately to your child without affecting the SF class of your first car. This is a popular option if the child frequently uses the second car and now needs to insure it independently. The insurance for young drivers can thus be made significantly cheaper. Another special case involves company cars. If you have been driving a company car accident-free for years, it is possible to transfer its SF class to a private contract, provided this has been agreed in advance with the employer and their insurer. Without such an agreement, the SF class of the company car expires upon a switch. In the unfortunate event of the policyholder's death, heirs can, under certain conditions, take over the SF class, usually upon presentation of the death certificate. This is relevant if you wish to take over a car insurance in the event of death. These special constellations require careful examination of the respective contract conditions.
Weighing costs and benefits: When is it really worth transferring?
The transfer of the SF (no-claims) class is not always the best solution in every situation. The main advantage lies in the significant reduction of insurance costs for the child. New drivers often start in the expensive SF class 0 or SF ½, which can lead to annual premiums of over one thousand euros. By taking over a higher SF class, such as SF 5, these costs can be reduced by more than half. The disadvantage for the person transferring is the irreversible loss of their own SF class. A retransfer is generally excluded. Therefore, the transfer should only be made if you are sure that you no longer need the SF class yourself, perhaps because you are giving up driving or handing over the second car. An alternative to keeping costs low for new drivers can be registering the vehicle as a second car of the parents, with the child listed as the driver. This way, the child can gain driving experience and possibly take over the second car’s SF class later on. Careful calculation and advice help to make the best financial decision.
Expert tips for the optimal design of SF class transfer
To optimise the process of transferring car insurance to your child, take note of the following expert advice. Our expert tip: Discuss the exact conditions and deadlines with your insurer early on. Some insurers allow the transfer of a no-claims bonus up to seven or even ten years after the contract ends. Compare offers from different insurers, as the discount amount for the same no-claims bonus can vary. It is possible to carry over the transferred no-claims bonus to a new insurer. Document the child's regular use of the vehicle if this is a requirement of your insurer. Check if a transfer from motorcycle to car is possible if relevant; there are often special conversion rules here. If the child was not registered as a driver, this may complicate the transfer. Comprehensive advice, like that offered by nextsure, can provide individual solutions and ensure you take full advantage of all benefits. This way, you ensure the transfer proceeds smoothly and your child benefits to the maximum.
Legal aspects and pitfalls: What you absolutely need to know
When transferring the no-claims bonus class, legal aspects should also be considered to avoid future issues. The waiver by the transferring party is a legally binding document. By signing it, you confirm the permanent loss of your no-claims class. Insurers are not legally obliged to transfer a no-claims class; it is a goodwill gesture whose conditions are determined by the insurer. Ensure that all information in the transfer application is correct and complete to avoid delays or rejections. The transfer only affects third-party liability and comprehensive insurance. There are no no-claims classes for partial comprehensive insurance, and thus no transfer option. If the child causes an accident after taking over, the downgrade in the no-claims class will be based on the new contract. A previous takeover of car insurance from the parents should consider all these points. Transparent communication with the insurer about all details protects against unexpected consequences.
Long-term Planning: How Your Child Can Build Their Own Positive Claim Record
More useful links
Wikipedia offers a comprehensive overview of motor vehicle liability insurance, its principles, and legal aspects.
FAQ
What exactly is transferred to the child in car insurance?
Is it always sensible to transfer the SF class?
Not always. The transfer is useful if the transferring party no longer needs the no-claims class (e.g., when giving up a vehicle). For the child, it can mean significant cost savings. However, for absolute beginners, it's hardly worthwhile as only a few years can be credited. The transferring party loses their no-claims class permanently.
Can I transfer the SF class of my second car to my child?
Yes, this is often possible. The no-claims discount class of the second car can usually be transferred separately without affecting the no-claims discount class of your first car. This is a common method to provide children with a more affordable entry into insurance.
What happens to my SF class after I've transferred it?
If you transfer your SF class, you will lose it permanently. A retransfer is usually not possible. When registering a new vehicle, you would again be classified with a low SF class (e.g., SF 0 or SF ½), unless you have another contract with its own SF class.
How do I apply for the transfer of the SF class?
You must submit an application to your vehicle insurance or that of the donor. Many insurers have specific forms for this purpose (often referred to as a rebate transfer or waiver). Both parties (the donor and the recipient) usually need to agree and sign.
