As popa said, don’t play games with insurance. In addition to being honest, the potential material consequences for not doing so are not fun.
I thought I’ve heard that some insurance companies might allow an affidavit that the child does not drive because he’s in school even the school is not > 100 miles away. If you’re not happy with your current insurer’s policies, then inquire about other insurers and perhaps switch to a different insurer.
Oomis, the key there is “and told us to inform them when he returns…” In my understanding, they assume that anyone who has a license will drive at some point regardless of parents’ wishes to the contrary. Therefore, they want the child on the policy too even if you really believe he will not drive.
The savings of not having to have him on the policy can help defray the out-of-town Yeshiva costs, I guess…