Findings by insurance firm swiftcover.com have shown that 36,000 parents are committing the crime to save money on car insurance costs.
According to the company, a quarter of people it contacted amid concerns over their policy admitted to writing their child as their spouse instead of a named driver so they could use a vehicle at a cut price.
The offence is known as fronting, whereby an older driver is insured as the main driver of a vehicle when in fact the primary motorist is much younger and is included on the policy as a named driver.
Claims director for the firm Robin Reames commented: "Trying to buck the system by fronting is not only illegal; it actually ends-up costing law-abiding motorists if they are involved in an accident with a fronted driver who is actually an uninsured driver."
Mr Reames added that such fraud is pushing up premiums for everyone, meaning that parents who think they are doing their children a favour could in fact be doing all motorists a disservice.
"We understand that insurance is costly for younger drivers, but premiums reflect the number of claims they are involved in and therefore the level of risk they pose," he said.
The Financial Ombudsman Service has previously reported that insurance providers reject a thousand claims every year because of fronting offences, the BBC has reported.
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