It's called "fronting" where a mum/dad insures the sons/daughters car and states as a legally binding and RECORDED statement to the insurance company, that they(parent) are the main user.
It is absolutely illegal and very common, insurer will not do anything until a claim, as they get your money, but will then do tricks to show the daughter was the main user, and avoid paying out.
They then have a legal obligation to report this to the police, and action may be taken by them.
tabetha