Car insurance coverage follows the vehicle, not the person driving it. As long as the person driving your car does so with your permission, you are allowing him or her to borrow your insurance coverage as well. If you are thinking of allowing someone to drive your car on a long-term basis, you can add that person to your existing policy. Another option is to have the borrower buy a non-owner auto insurance policy.
If the person who has borrowed your car is involved in an at-fault accident, your insurance company will pay for the damages caused, up to your policy limit. The accident is recorded on your insurance record. Your rates will likely increase when the policy is up for renewal, even though you weren’t driving at the time.
You should be very cautious about lending your vehicle to anyone, even if the borrower only wants to use it once. Unless you are confident that the borrower will exercise due caution when operating your vehicle, saying no or offering to drive the person to his or her destination may be a better choice.
Adding a New Driver to Your Policy
If the borrower is someone who lives in your home, your insurance company may allow you to add him or her to your policy as an occasional driver. This is a good time to get quotes from other auto insurance companies for a policy which will cover both of you.
The insurance company will ask questions to find out about your driving history, as well as that of the person who will be added to your policy. If you are planning to share your vehicle with a person who has been licensed for several years and has been able to maintain a clean record, you should be able to qualify for better rates than if the other driver has been involved in accidents or accumulated moving violations on his or her record.
Non-owner Auto Insurance Coverage
A person who will be driving someone else’s vehicle for a long time can buy a non-owner auto insurance policy. It provides protection for the driver when he or she is operating someone else’s vehicle. The non-owner policy will also provide protection if the policyholder rents a car. This type of insurance provides the following type of coverage:
- Liability coverage to pay for claims made by the occupants of the other vehicle in an accident
- Personal Injury Protection (PIP) coverage to pay for medical bills and related expenses incurred by the policyholder as the result of an accident
- Uninsured and underinsured motorist protection to pay for damages caused by a driver who doesn’t have insurance or doesn’t have enough insurance coverage to fully pay for the damages caused in an accident
The decision of whether to lend a vehicle to someone for a long time is one which requires a lot of thought. If you have concerns about whether to trust someone else with your insurance, a better choice is to suggest that he or she arrange for coverage through a separate policy.