Hi Krish, it is not illegal to have two policies on the same car, it is just extremely complex, and it comes down to "insurable interest" and who owns the vehicle. It also becomes very complex when claiming. It is for that reason it is frowned upon by insurers.
My honest opinion would be if your daughter is going away in 4 months to university, it is not worth even thinking about insuring her on your car. Even though i appreciate the excitement of passing her test, and the want to get in a car and drive unless she is insuring her own car, not worth the hassle. Trying to insure your daughter mid term is a nightmare as just passing her test makes her the highest risk possible, and insurers will decline.
If she has lasted this long without driving, 4 months of driving, and then not driving for the time she is at Uni ,That 4 months of experience of driving will not benefit her. Or at least not to the amount it will cost to insure her for such a small amount of time. The only way of doing it is by starting a new policy with her on it. And the cost of that for four months of use? and not using it for the rest of the year?
Kind regards
Tim