Financial Responsibility Laws

• Some states, including Florida, require you to sign your child's driver's license when your child receives it and require you to sign a financial responsibility document. This agreement makes you financially responsible for your child's behavior while behind the wheel until she turns 18. This rule is in place to ensure you don't just purchase the child her own insurance policy and stop paying attention to her driving skills because you're not financially liable if she gets into an accident. Parental involvement is a key element in preventing the kind of reckless teen driving that can lead to a fatal auto accident.
  
  

Teen Running Errands

• Teen driving laws in other states, including Illinois and Maryland, rule you as a parent financially liable if your child was performing a task for you when the accident occurred. This could be as simple as running errands or going to the grocery store at your request. The law determines a teen performing a parent's business on a case-by-case basis. Under these regulations the driver of another vehicle involved in an accident could sue you in civil court for damages resulting in the accident because of your financial liability dictated by state law.
  
  

Title a Vehicle in Child's Name

• A child becomes a legal adult at 18 but may still display the same immature decision-making behind the wheel for a few more years. You can mitigate your liability under state laws by titling the vehicle your child owns in his name. This makes the vehicle and the teen's corresponding insurance completely separate from your vehicle and insurance policy. You won't share any liability your teen driver incurs from an accident if he's driving his own vehicle. This is a more difficult strategy to employ with a driver under the age of 18 because a minor cannot legally own property.
  
  

Failing to Supervise Driver

• Failing to properly supervise a teen driver who still has a restricted driver's license could result in your liability for any accident the teen gets into regardless of her auto insurance policy. A restricted driver's license may require a teen driver under the age of 18 to have a parent or a licensed driver over the age of 21 in the car with him at all times. Many states employ a graduated license system using restricted licenses for teen drivers to encourage more parental involvement.